Finance Committee warns departments against deficit spending

Marlborough City Councilors issued a stern warning to department heads to stay out of the red and keep their budgets balanced during the Sept. 21 Finance Committee meeting. The warning was prompted by two budget transfer requests from the Department of Public Works (DPW) in the amounts of $11,500 from the Equipment Operator line and $7,448 from the Motor Equipment Repairman line into the department’s Part Time Help Budget.

    With that budget line currently in a deficit, DPW Commissioner Ronald LaFreniere explained that the funds were used to pay the salary of a temporary employee hired about six months ago. The employee was hired to help alleviate some of the work left by two employees who have been on workman’s compensation for the past two years. 

    “[The other members of the department] were strapped,” LaFreniere said. “We asked and were given approval [by Mayor Nancy Stevens and the personnel director] for one employee to fill two positions.”

    Finance Committee member and Ward 1 City Councilor Joseph Delano raised concern that the department can hire part-time employees without approval from the council. He also questioned the book-keeping system that allowed the department to go into deficit to fund a position. Looking to eliminate future departmental accounting errors, Delano asked the auditing department if they could put in additional steps or a new procedure.

     City Auditor Diane Smith said that the deficit was first caught at the end of August when the department was only $500 in the red. Citing timing issues because of summer recess, Comptroller Tom Abel said that according to state law the budget is not allowed to go into deficit, but that Federal law requires wages to be paid, which trumps the state law’s budget guidelines. Therefore, because the deficit accrued as a result of salaries, the city was obligated to pay the salary and go negative.

    “It is supposed to be caught before,” Abel said. “Sometimes it does happen.”

    “I have been here a number of years and quite often departments go into deficit,” LaFreniere said.

    With many of the councilors looking for more input into ways to prevent overspending, Councilor at-Large Stephen Levy said that the City Council has no control over the matter when the information comes in after the fact. Delano agreed.

    “The system is not working,” Delano said.

    Defending the circumstances leading to the deficit, LaFreniere said that he expected a resolution in the workman’s compensation cases before the fiscal year 2010 budget year.

    “For a year and a half I have been asking for resolution … Suffice it to say that I have been asking to put this matter to bed,” he said.

    With other city departments using overtime budgets to cover similar issues, LaFreniere said that he took the money from the Part Time Help Budget of about $9,000 because the position was a temporary position. The extension of the position coupled with staff vacations led to the depletion of the budget line, which was originally budgeted to fund summer help, vacation and sick time.

    After approving the budget transfer, the Finance Committee now plans to draft a letter requesting that the mayor address deficit funding with department heads.





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