FENWICK ISLAND – Fenwick officials this week presented a draft budget projecting a $541,000 operating loss in fiscal year 2024.
On Monday, Councilman Bill Rymer, treasurer, presented members of the Fenwick Island Budget and Finance Committee with a draft spending plan for fiscal year 2024. With $2.17 million in projected revenues and $2.71 million in projected expenses, he said the town faces an operating loss of more than $541,000.
“Traditionally, the expenses for the town, the daily operating expenses, typically exceed revenues, and then the realty transfer tax funds are used to help bridge the operating loss gap and pay for capital expenditures,” he said. “The high-level summary is we are in the same situation, where expenses exceed revenues.”
Rymer noted that the projected operating loss has increased by roughly $250,000 with most of that sum tied to increases in salaries, benefits and taxes.
“What you see in front of you is a payroll increase of roughly 11% but there’s also a health insurance rate increase, and we’ve had changes in our employee group …,” he said. “From an overall expense standpoint, the $250,000 in operating loss increases is primarily related to salaries.”
Under projected revenues, the town has budgeted $735,000 for property taxes, $480,000 for rental receipt tax, $300,000 in building permit fees and $200,640 in trash collection fees, among other things.
Rymer noted that while building permit fees in fiscal year 2023 have exceeded projections by more than $150,000, he did not expect that trend to continue.
“I truly believe this budget is based on one change, and that’s how we anticipate building permit fees to decline,” he said.
Under projected expenses, the town has budgeted $986,805 for police, $534,021 for general government, $426,256 for lifeguards and $421,153 for administration.
Rymer noted that the police department accounted for 36% of town expenses, while general government accounted for 20% and administration accounted for more than 13%. He pointed out that salaries and benefits accounted for 74% of the overall budget.
“If pull out salaries, benefits and taxes, we are really budget neutral from a spending standpoint,” he said.
Rymer also presented the committee with a capital expenditure list totaling $1,247,249. He said the town has budgeted $110,000 for street maintenance, $49,000 for police vehicles and $36,650 for town hall improvements. The capital budget also includes $1 million for a long-awaited dredging project in the Little Assawoman Bay.
“Right now, $1 million of that is dredging, and I hope we can spend every penny of it,” Rymer said.
At the end of the current fiscal year, officials estimate the town will have roughly $4.3 million in cash balance. Subtracting the $541,000 in estimated operating loss, $1.2 million in capital expenditures and other items, Rymer said the town projects a cash balance of nearly $2.8 million at the end of fiscal year 2024.
“I’m trying to highlight where our funds are at and where they are projected to be after this budget cycle,” he said.
Officials say a second meeting of the budget and finance committee will be held June 5. From there, the committee can forward a favorable recommendation to the town council.
“If on June 5 the committee approves the budget, there will be a June town council meeting to officially approve the budget,” Rymer explained.
The fiscal year 2024 budget begins Aug. 1.
