The state Comptroller’s office has released an audit of the town of Milford that criticizes the manner in which town finances have been managed and suggests that the town adopt budgets that are “realistic.”
The state agency, headed by Comptroller Thomas DiNapoli, urged the Milford town board to stop relying on appropriated fund balances and other one-time revenue sources to fund recurring expenditures.
The state auditors also called on the town government to ensure that monies are repaid to the town-wide general fund that were “inappropriately transferred to a fund with a different tax base.”
The monitors, who routinely audit the books of local taxing jurisdictions, said the Milford board did not consider actual historical results when adopting its budgets from fiscal years 2009 through 2012.
“Also, in an effort to keep the real property tax levy low, the Board included the use of fund balance in each of its adopted budgets to finance operations from fiscal years 2009 through 2013,” the audit stated.
With approximately 3,000 residents, Milford is one of the most populous communities in Otsego County.
DiNapoli’s report said that the board’s “overreliance on fund balance as a financing source kept the tax levy artificially low during these years and ultimately exhausted fund balance. The exhaustion of fund balance will have a significant impact on the financing of future budgets and the ability to maintain current service levels.”
The report went on to note that after Milford’s fund balance was reduced, town officials passed a local law to override the state’s 2 percent property tax cap for the 2014 budget and increased taxes by 6.4 percent. “To avoid overriding the tax cap in future years’ budgets, the Board will likely need to develop budgets that have other financing sources to ensure services will continue to be provided to Town residents at the current level. Otherwise, reducing expenditures and service levels will be the only option for the Town to avoid severe fiscal stress.”