Board Tables Kabot Proposal For $1 Million In Surgical Cuts, Calls For More Time

By Kelly Carroll | 1 Comment

Town Supervisor Linda Kabot, right, proposed $1 million in spending cuts last week. On Tuesday, Councilwoman Anna Throne-Holst, left, along with other board members, hesitated to act on the legislation. Photos by Kelly Carroll

Southampton - After proposing $1 million in mid-year cuts to town spending at a town board work session on Friday, June 19, Southampton Town Supervisor Linda Kabot's resolution was tabled Tuesday night, as several board members stated they would like more time to work with their department head liaisons to determine if the cuts were indeed the right move.

"I think there are a lot of issues with it," Town Councilwoman Anna Throne-Holst asserted. "It sounds to me like, no matter what, more review has to be done here. All of us need to spend more time with our liaisons. We certainly all agree that this is a goal we need to achieve."

Town Comptroller Tamara Wright said the town board needs to send a "serious message" to department heads on the spending issue.

On Friday, June 19, Supervisor Kabot alerted the town board that she would be trying to pass a resolution for approximately $1 million in cuts to spending. According to Kabot, the cuts stem from the lack of mortgage tax revenue - approximately $2 million less than budgeted for - coming into the town. In addition, she said more cuts should be anticipated down the road.

"Due to a dramatic decline in mortgage tax revenues, the expense side of the ledger for 2009 must be reduced as there are no more rainy day funds available to appropriate to cover this projected loss," Kabot said in a statement released last week. "Although I budgeted conservatively for projected mortgage tax revenues for the year 2009, we have determined that the prior six months' income is much lower than anticipated. As the town's chief financial officer, I now project a shortfall of $2 million for 2009, necessitating $2 million in cuts immediately."

According to Kabot, department heads were notified in January that mid-year cuts would be necessary. In April, she said, they were again told that spending needed to decrease immediately.

Cuts Too Sweeping?
However, Councilwoman Throne-Holst, along with Councilman Christopher Nuzzi and Councilwoman Sally Pope, argued that the cuts were too sweeping, and without enough input from the town department heads.

"I'm concerned about morale in Town Hall," Pope asserted. "I think if we involve the department heads on a higher level, they won't have this attitude that there's money to be spent.

"It's not just, 'I want to make these cuts,'" she continued, "and I don't want to be a board member who acts that way."

"It's not just, 'I want to make these cuts,'" Councilwoman Sally Pope offered, "and I don't want to be a board member who acts that way."

In creating the 2009 budget, Kabot estimated that approximately $7.5 million in mortgage tax revenue would come into the town this year, a 30 percent decline from previous years when the real estate market was booming. However, according to the Supervisor's Office, only $2.5 million in mortgage tax revenue has been received in the past six months. A $3 million intake is projected for the rest of the year, which would make the total 2009 mortgage tax revenue approximately $5.5 million.

"Department heads have relayed that they do not understand the severity of the situation," Town Comptroller Tamara Wright advised the board. "There is a need to send a very serious message."

Spending Slashed
Within Kabot's proposed legislation, contingency allocations for the general fund and the police fund were decreased drastically, with $342,265 in contingency spending taken from the general fund and $237,921 taken from the police fund. In addition, the vacant positions of senior kennel attendant in the town's animal shelter, driver messenger in the Town Clerk's Office, and environmental analyst and principal planner in the Land Management Department would be abolished. The board did pass a resolution to abolish a filled building construction coordinator position Tuesday night as part of the expansive cuts, but it was separate from Kabot's main resolution.

Expense allocations within the general fund - which include spending for supplies, travel, training and utilities - were also slated for a decrease, at $302,184. The Land Management fund would have seen a decrease in expense allocations, at $53,578. Decreases to overtime appropriations were also proposed, however those savings have yet to be determined.

"If you don't stop the spending, [department heads] may continue to spend, and then you have less of an amount to cut," Supervisor Kabot told the board. "This is surgical. Deeper cuts mean personnel."

Supervisor Kabot is scheduled to give a financial State-of-the-Town address on Tuesday, June 30.

In addition to the proposed mid-year cuts, Kabot also initiated two resolutions for changes to the highway department and stormwater management. The legislation proposes that the two be reattributed to funding sources other than the general fund, to alleviate financial burden.

Due to the uncertainty with the legislation shown by a majority of the board members, all three resolutions were tabled until July 14. However, because they were not passed, Kabot circulated a memo to department heads Wednesday morning advising them that the amounts indicated to be cut in her resolutions are now frozen.

"DO NOT SPEND the amounts indicated in the budget lines identified," the memo reads. "We must accrue cost-savings through reduced spending in order to make payroll by year-end, given our constrained financial condition." The supervisor also mentioned lowering the threshold for purchase orders needing her approval, from $1,000 to $500. On June 30, at 1 p.m., she will address the public in a financial State-of-the-Town address at Town Hall.

"These are serious issues," she asserted Tuesday night. "We cannot wait."