Prospect posts loss in its fund balance

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PROSPECT — The town ended fiscal year 2010 with a decrease of about $69,000 to its fund balance, an audit shows.

Prospect’s fund balance, or surplus, stood at $201,245 as of June 30, 2010, a decrease of $69,372 from the previous fiscal year, according to an audit performed by Michael J. Battista, a Northford-based certified public accountant.

The audit attributed the decrease mostly to revenue shortfalls, including lower collections of property tax, interest and lien fees and investment earnings. Also, the town’s expenditures grew, primarily in capital expenditures and general government.

General government costs rose because health insurance went up by 15 to 20 percent and town buildings had $25,000 worth of repairs, Batista said. Capital expenditures increased due to two lease-purchases for a 2010 International Dump Truck for public works and a 2010 Ford Expedition for police, he said.

The town’s surplus has been down the last two years, Battista said. In the fiscal year ending June 30, 2009, the town’s surplus dropped from $475,489 to $270,617, a decrease of $204,872. The year before that, it increased by $58,500 to the $475,489 figure.
The town’s fund balance represents 0.8 percent of the town’s total expenditures, according to the audit.

The Town Council accepted the audit earlier this month.

Mayor Robert J. Chatfield said the town has already used some of the surplus for a tax refund for residents living in the active-adult community off Scott Road under construction by Toll Bros. of Pennsylvania.

He said he also expects to use some for this year’s removal of ice and snow.

However, Prospect is ahead in some revenues this year, he said. For example, as of Dec. 31, the town has collected $40,322 in town clerk fees of the $55,000 estimated in the 2010-11 budget.

He said he would like to see more money in the surplus, but he doesn’t want to overtax residents.