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Proposed FY2010 Budget
This is the operating budget for the core regional services functions of the Hampshire Council of Governments. Two major Council programs have separate budgets: the Hampshire County Group Insurance Trust and Hampshire Care. The insurance fiscal year is April to March, correlating with the insurance contract year; the nursing facility fiscal year is January to December; correlating with reimbursement reporting requirements.
HAMPSHIRE POWER:
• Hampshire Power, the Council electricity program, continues to dominate the Council budget, accounting for over $6.4M of $7.6M projected expenses. While projections can be made with a bit more confidence this year, it is emphatically not possible to know what the electricity markets will bring twelve months from now. Additional school, business, and municipal customers continue to join the program, increasing the potential impact on our budget. Projections for the purchase and sale of electric power have been included with the understanding that they may differ from the actual results. Because the energy markets can be volatile and difficult to predict, the Council Finance and Electricity Committees meet monthly to respond to energy developments and their impact on our finances.
MEMBERSHIP DUES LEVEL OR REDUCED:
• For the ninth consecutive year, annual dues to the Council have either remained steady or declined. When the Council began in 1999, our goal was to develop entrepreneurial sources of revenue sufficient to support regional services while reducing dues. Committee work continues to focus on that goal.
• All twelve member towns voted in 2006 to reduce membership dues by an additional 75% by committing to a four-year membership, so for the fourth year in a row, all current members are taking advantage of the “four-for-one” dues reduction. Member dues of $37,206 help to support total program activity in excess of $45,000,000 across all budgets.
EARNED INCOME: The Council is aggressively pursuing the benefits of capital and enterprise that bring stability to private organizations.
• The Council leases portions of the Old Courthouse, generating annual revenues of approximately $120,000.
POSTPONED OBLIGATIONS:
• As in all of our member towns, budget cuts in recent years have reduced staff significantly. This budget continues to rely on employees performing the duties of more than one position. In spite of a deep commitment among employees to providing excellent services, some functions are simply not being performed adequately. For example, the maintenance and protection of historical documents archived here has been neglected.
• Again this year, minimal funds have been budgeted for building maintenance. It is critical to protect the integrity of the exterior shell of the building, including repairs to roof and basement walls and a professional assessment of the infrastructure needs to be conducted of this historical building.
• Computer maintenance has been budgeted at the bare minimum with the expectation that the present equipment will support operations through FY2010 budget.
FY2010 OVERALL OUTLOOK:
Financial problems that plague our member towns create both opportunity
and uncertainty for the Council. The rising costs of health insurance,
retirement, and energy are three of the most damaging items in local budgets,
reinforcing the importance of the Council’s programs to save the
towns money in those three areas and in cooperative purchasing. Policy
discussions appear with increasing frequency proposing that municipalities
increase efficiencies with regionalized services, suggesting that there
may be a need for additional shared services, but it is difficult for
towns to budget money to support a regional service when they are cutting
their own staff.
Employee health and retirement costs that threaten businesses are a major
problem at Hampshire Care, where state law mandates require higher costs
than private nursing facilities pay, yet state reimbursement formulas
make no allowance for the increased costs. With the increasing cost of
Hampshire Care to the Council, it has become necessary to put the facility
on the market with the stipulation of continued care of the patients and
continued employment opportunities for our staff.
Growth of the Hampshire Power program promises to provide both savings
for our customers and revenues for the Council. Future goals of the program
include offering a fixed rate, green power options, and residential aggregation.
The Council of Governments is subject to the same pressures that other
governments and businesses are facing today, and is uniquely positioned
to help the region weather the threatening financial clouds.
