Determine whether the Town of Saratoga (Town) Board (Board) adopted realistic budgets and effectively managed fund balance.
The Board did not adopt realistic budgets or effectively manage fund balance. The Board also:
- Adopted annual budgets expecting operating deficits totaling $1,041,991 in the three main operating funds, but operating surpluses totaling $839,465 occurred, increasing fund balance instead of using amounts budgeted.
- Maintained unrestricted fund balances that were 97 percent, 770 percent and 50 percent of the ensuing year’s appropriations as of December 31, 2021 in the town-wide (TW) general, town-outside-village (TOV) general and TOV highway funds, respectively. These amounts are excessive and could be used to reduce the TW general fund’s tax levy.
- Improperly funded reserves with transfers totaling $370,000 from funds with a different tax base, which creates a taxpayer inequity.
- Adopt budgets that contain realistic estimates based on available current data and historical trends.
- Develop a plan to reduce the amounts of surplus fund balance in a manner that benefits Town taxpayers.
- Ensure transfers are only made to funds with the same tax base.
Town officials generally agreed with our recommendations and indicated they planned to initiate corrective action.