Snowflake Finance Director Disputes Budget Figures Used By Committee

By Naomi Hatch
   Snowflake Finance Director Brian Richards expressed concern to the Snowflake Town Council last week regarding incorrect information in a paper that was sent to Taylor postal customers from the Taylor Fact Finders Committee after the June 3 Taylor Town Council meeting. Leaders of the committee are listed as Eddie Hancock, Faye Hatch and Ron Bish.
   The Taylor Fact Finders Committee included a chart in the mailout that showed “Total General Fund” figures and listed them under Mar-04, Apr-05, May-06, June-07 and July-08. When talking with Taylor Finance Director Gus Lundberg, he said, “One thing that was unclear on the Red Letter was the months,” noting that he thought it should have been fiscal years.
   Richards pointed out that there were errors in the chart, explaining that the May-06 number for Taylor should read $3,805,665 rather than $3,580,686 as written in the letter. Lundberg confirmed these figures. The Red Letter notes that the figures used, excepting the totals, were taken from a report from the Arizona League of Cities and Towns.
   “There’s a big difference between budgeted numbers and actual expenditures,” explained Richards. The Snowflake figures for Mar-04 and Apr-05 were the same with an asterisk that noted, “It is not clear why these figures are identical.” Richards said the 04 figure is $3,473,596 and the 05 figure should have been $4,312,081.
   Richards noted that he had a call into a member of the committee to discuss the discrepancies.
   He explained to the council June 9 that it looked to him like the committee took the budgeted numbers from Taylor and subtracted the budgeted numbers from Snowflake, and said Snowflake overspent. Richards said he was confused as to why they would subtract Snowflake’s budget from Taylor’s budget, because each town has an individual budget that has nothing to do with the other town.
   “We’ve never increased our spending by over 100 percent,” said Richards, noting “we have to budget for things that may not be completed during the fiscal year.”
   Under cons of consolidation, the Red Letter stated, “Taylor is and has been running much more efficiently than Snowflake,” followed by the chart showing the budgets of each town.
   In an interview Richards said, “If you were judging efficiency, you would not use the budgets. In considering budgets between the two towns of Snowflake and Taylor, one must consider all the variables in budgets.” He gave an example that both towns share the police department, but since Snowflake administers the police department, the town has to include the entire $1.8 million police department budget in its general fund budget, whereas, Taylor only includes its share of the police department budget. “This artificially increases the Town of Snowflake budget and actual expenditures by $800,000 to $900,000,” said Richards.
   Another example is the fact that Snowflake budgeted $1.5 million for a flood control project expenditure the last three years. Richards said, “If Snowflake had not budgeted for this expenditure, then we wouldn’t be able to do the project. Snowflake will complete the project when all the grant funds have been obtained.”
   He further noted, “There are differences in General Funds for both towns because of a variety of factors, including organization structure, one has a library, the other doesn’t, one has an ambulance service, the other doesn’t, one has a pool the other doesn’t, etc.”
   Richards gave budgeted expenditure figures and actual expenditure figures for Snowflake as follow: 2004, budgeted $3,473,596, actual $3,269,599, under budget $203,997; 2005, budgeted $4,312,081, actual         $3,075,642, under budget $1,236,439; 2006, budgeted $5,104,823, actual $3,069,175, under budget   $2,035,648; 2007, budgeted $6,258,902, actual $3,804,039, under budget $2,454,863; and 2008, budgeted   $7,595,676, actual $5,353,234, under budget $2,242,442.
   The figures listed for the Snowflake General Fund by the Taylor Fact Finder Committee are: 2004, $3,473,596; 2005, $3,473,596; 2006, $5,104,826; 2007, $6,309,202; and 2008, $7,595,676. Again, the Red Letter notes that the figures came from a report from the Arizona League of Cities and Towns.
   “The figures show that Snowflake did not go over budget,” said Richards. He also noted that in 2008, Snowflake built a new $1.3 million fire station, a one-time expenditure.
   In response to the statement, “Snowflake, with only a 12.5 percent larger population has increased its spending by 100 percent,” Richards said, “The five-year increase in actual expenditures equals 23.97 percent for Snowflake and 20.30 percent for Taylor. This number is after subtracting the one-time expenditure of $1.3 million for the new fire station.”
   Lundberg confirmed that the figures given for Taylor in the Red Letter were correct except in May-06 as Richards had stated.
   “If you’re just looking at budget numbers, obviously in their (Snowflake’s) case they had capital projects, so when you use budget numbers you’re not comparing apples to apples,” said Lundberg.