High praise for Smithfield's fiscal house

High praise for Smithfield's fiscal house

But police pension fund continues to be underfunded

SMITHFIELD - The town added $39,000 to its cumulative surplus during the fiscal year that ended last June 30 - bringing the total to $15.51 million, and continued to maintain a strong financial position, according to the annual outside audit.

At a Jan. 7 work session, Robert J. Civetti, of the accounting firm Braver PC, praised Town Manager Dennis Finlay and Finance Director Randy R. Rossi for "running one of the smoothest finance departments I'm involved in."

He said of the town's fiscal standing that he personally works with seven Rhode Island municipalities and his firm audits a total of 17, and "a lot of communities wish they were in this position."

All but $3.16 million of the cumulative surplus is committed to specific areas, including capital improvements projects, and is not available to be otherwise spent.

The audit, part of the municipal Finance Department's annual report to the Town Council, does make note of a continuing concern - the serious underfunding of a now-closed, town-managed police pension plan, but indicates that the situation has improved.

Funded at only 16.8 percent the previous year, the pension plan according to the new audit is now funded at 19.2 percent, with assets of nearly $4.8 million and liabilities of nearly $25 million.

The improvement came because the town has upped its annual contribution from $1.05 million to $1.64 million, and intends to continue the larger payment.

New police hires now join the state retirement system. The old plan pays benefits to retirees who no longer make contributions of their own.

Despite the underfunding, Civetti told the council that "a lot of communities are in far worse shape."

The audit indicates that while the School Department ended its fiscal year June 30 with what appeared to be a budget surplus of $382,000, to do so it took $1.28 million from its own cumulative surplus for use in daily operations, meaning that in reality, it was in the red by some $904,000. Its remaining surplus stood at $2.1 million, according to the audit.

The report noted that for the fiscal year, 53.8 percent of the municipal budget went to schools, up from 52.3 percent the previous year.

As town officials contemplate putting several major bond issues on the ballot in the foreseeable future, long-term debt continues to be "extremely low," according to Town Manager Finlay. Annual payments on some $16 million in outstanding bonds totals about $2.6 million, or less than 4 percent of annual municipal spending that totals $66.4 million.

The audit noted that general property tax receipts came in $550,000 higher than anticipated because of aggressive pursuit of delinquent accounts.

Building permit fees, based on project cost, were $516,000 over budget.

Finlay attributed that largely to a major addition at the FGX eyewear plant on Route 116, construction at Bryant University, and renovations at Fidelity Investments and at the Smithfield Commons Mall on Putnam Pike for the new and upscale Siena restaurant.

Some facts about the community as listed in the report:

* Its population is 21,430, with most growth occurring from 1960 to 1990 when residency more than doubled to exceed 19,000.

* School enrollment for the fiscal year was 2,410, down from a 10-year high of 2,659 in 2005.

* The cost of educating each student was $13,523.

* The median sale price for a single-family home in October was $232,081.

* Residential property taxes account for two-thirds of the tax base.

* Taken as a whole, all of the property in town carries an assessed value of $2.7 billion.

For the fiscal year the town spent $4.6 million on the Police Department, $4.9 million on the Fire Department, and $2.3 million on Public Works.

The non-school section of town government employed 165 full-time workers.

The School Department payroll included 219 certified and 85 full-and part-time non-certified employees.