NORTH KINGSTOWN – The North Kingstown Finance Director, Jim Lathrop, issued the first fiscal year 2020 budget report to the town council, showing a projected surplus of more than $1.5 million.
While the budget report shows the town to be in good standing financially, Lathrop said that it was still “extremely early” in the fiscal year, which started only a couple months ago.
“This report is the first report of fiscal year 2020 and covers the first quarter,” Lathrop wrote in his report. “It is extremely early in the fiscal year, and projections could change significantly. At this time, we are projected a surplus of $1.7 million.”
During the town council meeting on Monday, Lathrop further explained the first quarter numbers, adding that, while the surplus sounded like a lot, it was less than 2 percent of the budget.
“The first couple months we don’t report, because it’s so early,” he said. “Overall we’re projecting a $1.7 million surplus. That sounds like a lot, but it’s about 1.5 percent, 1.7 percent. It’s still really small and there can be big fluctuations.”
The surplus, he said, was related to revenue exceeding budgeted amounts in several areas.
“Again, as normal for the last few years, it’s all related to revenue,” Lathrop said. “We’re exceeding our budgeted revenues. A lot of it is to police detail, interest income and the code enforcement. There’s a lot of development going on in town so you see the fees going up significantly.”
Police detail revenue is projected to be $250,000 over budget, while in the town clerk office, fees from recording and transfers are projected to be $125,000 above budgeted amounts.
Finance has also shown some one-time income and interest projections as being above budget, with a combined impact of $300,000.
And finally, fees from the building department are projected to be $105,000 above budget.
Current year tax revenues, Lathrop added, were also running ahead of previous years.
“This is a result of the continued efforts by our tax department,” Lathrop said. “As a result, we see a decline in collection of previous years’ taxes.”
While revenues are exceeding expectations, the town’s expenditures are running below budget due to wages, benefits and insurances.
“On the expenditure side, we see several departments below budget,” he said. “This includes town manager, finance, police and fire. Most is due to wages and benefits, while in finance it is related to insurances.”
Wages overall are in line with budgeted amounts, Lathrop continued.
“We are projecting overages in police detail and code enforcement, but these are directly related to increases in revenue from detail and inspection fees,” he said.
On top of everything else, Lathrop also said that the town was in a “good cash position,” with nearly $39 million on hand as of Sept. 30. However, because the town transferred all school-related funds to the school department and is no longer in control of reconcile accounts, the cash balance does not reflect funds held by the school.