Winsted financial audit troubling, not surprising

While a recently completed audit of the town’s 2007-08 fiscal year indicates a range of troubling problems, including a low fund balance and several accounts that were not properly reconciled, the news should come as no surprise to Winsted residents. It’s just another sign of difficult economic times.

Just as local businesses and families have been dipping into their savings accounts to pay the bills, Winsted has been using money that would normally go into its fund balance to limit tax increases on its residents. Large sums of money returned to the town by the state have not been added to the fund balance. Instead, they have been used to offer short-term tax relief.

Is this the fault of town leaders? In part, yes. They make the ultimate decision on how to spend the money. But a share of the blame can go to irresponsible taxpayers who lobby for zero-percent tax increases year after year. If selectmen spend all of their time looking to cut the budget to appease taxpayers, there will be little left over for the general fund.

With the fund balance sitting at just more than $800,000, the account represents 2.6 percent of the annual budget, or half of the minimum expected in a healthy municipality. The low fund balance can translate into poor credit for the town, which ultimately costs taxpayers more money.

So much for those short-term tax breaks.

Townspeople who want leaders to be more fiscally responsible should spend less time worrying about short-term expenditures and more time recognizing the need to put some money away for the long term. Voters must accept some increases in spending and the occasional tax hike if they want to keep the town in good financial health.