David Lublin, the Town treasurer and a member of its Council, gave a mid-fiscal year 2014 report on Friday that showed an expected $800,000 surplus for the year. That amount will be stacked on to the Town’s roughly $8.2 million general fund balance.
The Town expects to spend about $3.5 million from its operating and capital budgets, with revenue of about $4.3 million from a portion of residents’ state income tax and highway user revenues.
For the past year, the Town has brainstormed ways to try to use part of that surplus. It explored a free shuttle service to downtown Bethesda and even undergrounding power lines.
On Sunday at 2 p.m. and Tuesday at 5 p.m., the Town will hold two forums to get public input on how to use those reserve funds. On Wednesday, the Town Council will decide whether to spend $360,000 on an 18-month contract with a legal firm to present its case against the Purple Line.
Lublin said the Council should save a sizeable chunk of the surplus:
As the Council considers ways to use available Town reserves for new or expanded programs and services, some of the available monies will need to be saved for future capital expenditures and emergencies. Over the years, the Town has been fortunate to be able to fund all capital projects from its available reserves without the need to set aside annual operating revenues. It would be sensible to continue to save for future capital projects, especially due to the recent volatility in revenues. The Town’s 5-year capital improvement plan estimates that the Town will spend approximately $3.7 million on capital projects between July 2015 and June 2019.
In addition to a capital project reserve, the Council has in the past saved additional monies as a contingent reserve, which provides funds to respond to emergencies such as snowstorms, hurricanes, etc. Historically, the Town has earmarked the equivalent of 30% of the Town’s annual operating revenue for such a purpose. In FY14, the amount earmarked for a contingent reserve is $1.2 million.
Graphic via Town of Chevy Chase