Deceased capital expenditures and reduced program services are part of the proposed Fiscal Year 2021 budget town staff presented to Town Council Monday. The staff’s blended approach adapts to the potentially significant loss of sales tax revenue in the coming year, and is made possible by years of prudent budgeting and planning, which puts the Town in a respectable position to respond to significant anticipated reductions in income. The tradeoffs are a necessity in response to the COVID-19 pandemic and includes reductions throughout the town’s departments and utilization of over $4.8-million in reserve funds saved for a “rainy day.” The anticipated decrease in revenue assumes a projection that sales and lodging tax will be down 50%, meaning the Town will collect $7.1-million less in taxes during the coming year. A portion of that decrease in revenue will be made up with reserve funds. Staff proposes to utilize $4.8-million in reserves, which would leave about $3.7- million in reserves or the recommended 21% of the annual budget. Reductions to make up for the rest of the loss are proposed to come from fewer capital expenditures and a 23% reduction of town program services from last year. The largest reductions are proposed from Town Police, Public Works, and START, reflecting the relative budget-size in these departments. Reductions also include cutting and freezing nine full-time equivalent employees. Town Council will now review the draft budget line-by-line before adopting it.
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