The Southampton Town Board has amended a 10-year preliminary capital budget filed in September 2007 by then Supervisor Patrick Heaney. setting what Supervisor Linda Kabot called “a more realistic timeline for various capital projects.”
At a special work session last Friday, the board adopted the amended 10-year program, which allocates $19.2 million in 2008 for capital—or long-range—projects such as upgrades to facilities, creation of new parks, and construction of community centers and paving of roads. The $19.2 million capital program is on top of the $77 million 2008 operating budget, which pays for the day-to-day expenses of running the town.
In the capital plan, which is considered to be a work in progress and can be amended from time to time, $14.2 million for certain projects will be financed through bonds over the course of the year, with several endeavors to be funded through the budgetary surplus. Grants from county, state and federal agencies could account for some of the capital funding as well.
The amended capital plan was the result of two weeks of meetings between town financial administrators and department heads to create, according to Ms. Kabot. The findings were reviewed for the benefit of the full Town Board at a work session March 24.
The amended capital program additionally plans to fund land use and water quality studies and pay for the upkeep and replacement of town vehicles and equipment.
Though local law mandates such a program be adopted by April 1, a simple majority—or three members—of the Town Board can further amend the capital plan.
The adoption of the amended capital budget marks a shift in fiscal policy for the town, one that new Town Comptroller Steve Brautigam and Deputy Supervisor and Town Business Manager Richard Blowes applaud. Both have said that mortgage tax revenues, which fill the capital budget, are less predictable than property taxes and department fees, which normally pay for expenditures in the operational budget.
Mr. Brautigam favors removing operational expenses from the capital budget and ensuring that capital funds pay only for capital projects. Mr. Blowes has stated that the town should rely less upon mortgage tax revenues, as a souring housing market could mean less of those funds in town coffers.
Under prior administrations, according to Ms. Kabot, revenues from mortgage taxes were injected into the operating budget to suppress the tax rate and to balance budgets. Mr. Brautigam has argued such fiscal policy can come back to haunt the town if an expected budget surplus does not materialize.
For 2008, the town collected $12 million in mortgage taxes, but budgeted for only $8 million. That $4 million excess, according to the new town comptroller, will be dumped in the capital budget and used for long-term expenditures, not day-to-day expenses.
Ms. Kabot refers to this approach as “pay as you go” and has likened it to what town residents must do with their own personal finances.
The newly adopted capital program includes $4.5 million for the Westhampton Community Center and $2 million in 2008 for the town’s aquatic recreation center, known as SHARC, with $4 million to follow over the coming two years; $2.75 million of prior funding has already been committed to the SHARC project, for a total price tag of $8.75 million.