During my reelection campaign, I've received a lot of questions about the town’s financial management. This is a topic I'm more than happy to talk about. I serve on the town’s Finance Committee and I am proud of our fiscal management during the past four years. Here are some highlights:
1) Reduced municipal tax increases by 44% during 2018-2021 vs the prior four years under the previous administration. The average tax increase for the past four years was only 1.1% vs 2.0% between 2014-2017 and our track record included the town’s first-ever 0% tax increase in 2019.
2) Reduced municipal spending nearly five-fold from 2018-2021. Our average annual appropriations increase was only 0.7%, compared to 3.5%, which occurred during the previous administration. This is remarkable considering the pandemic's impact on revenues and that more than half of the town’s expenditures are non-discretionary.
3) Maintained the town’s AAA bond rating.
4) Maintained a robust surplus that is appropriately sized for our town’s budget.
I helped achieve these results as Finance Committee Vice Chair and member alongside Committee Chair and Ward 1 Councilwoman Linda Habgood. We scrutinized every line item in the budget every year. The committee spent dozens of hours meeting with every Department Head, challenging every spending request, pushing for additional cost savings and exploring new revenue opportunities.
As a result of this detailed approach, we uncovered an “off the books,” $1 million account the police department accumulated under the previous administration. We closed this account and moved the revenue moved back into the budget to help defray the tax burden on residents. We also moved the town’s cash from an online savings account earning a paltry 0.25% to money market accounts earning more than 1%, a move that generated more than $100,000 in incremental interest income in the first year.
Additionally, we right-sized the town’s surplus or rainy-day fund, based on advice from the town’s independent auditor and bond counsel. They recommended maintaining a surplus that that was equal to 15-20% of the town’s budget, or between $7 million-$9 million instead of the bloated $14 million surplus we inherited, an amount equal to a whopping 31% of the town’s budget. We put these excess surplus funds to work, investing in much needed equipment, infrastructure, technology and town-wide events while lowering municipal taxes, all the while
maintaining a healthy surplus of $9.6 million at the end of 2020.
Now, you may hear from our opponents and their supporters that the surplus level at the end of April was "only" $5.8 million. While this is true, it is also highly, and probably, intentionally misleading. The town generates incremental surplus throughout the year via higher tax collections, lower costs, and/or higher miscellaneous revenues than budgeted. In fact, since 2014, the Town has generated an average of $3.3 million in incremental surplus including $2.5mm during 2020 and we project that by the end of 2021, the surplus will be $9.8 million (for those who like math, this is calculated by starting with $5.8mm, adding $2.5mm plus another $1.5mm which is the town’s first tranche of the federal CARES act funding). This $9.8mm projected surplus level is robust and above the level recommended by our town’s independent financial experts.
In short, Westfield's finances are in great shape and we look forward to maintaining our record of strong fiscal management -- lower taxes, an AAA bond rating, continued investment in equipment and infrastructure, and a right-sized budget surplus. This is a record I am proud to run on.
David Contract, Ward 3 Councilman