The Hudson Budget Committee met on August 6 to hear a presentation from Town Administrator Roy Sorenson on 2025 revenues and expenditures.
“I want to make sure everyone understands this is unaudited at this,” warned Sorenson. “The general has come in, and based on the numbers, spending is at 102%. The sewer fund is at around 70% and the water fund is coming in at around 98%. That includes everything at this time, which means anything that’s built into the general fund budget.”
Vice-Chair Kim Rice wanted to know why general expenditures came in at over 100%.
“How do you go over that spending threshold?” she asked. “Do you come to the Board after you spend to ask for money? It’s my understanding that for anything over 100%, you need to come to the Budget Committee before you expend those dollars.”
According to the Town Administrator, the issue was related to encumbrances or future fund commitments that have not been closed out. Salary calculations also played a factor, as Sorenson indicated the number would “balance out” over the next two months with more up-to-date numbers.
“That money hasn’t been spent if it’s part of an encumbrance. Having an encumbrance just means that money is put aside; it’s not spent yet. That still calculates in the overall number against the general fund,” said Sorenson. “One of the major encumbrances is the Melendy Road Bridge. It’s a huge number: $1.2 million. That money was set aside in the budget, and once we receive the check from the state, which is probably coming in, maybe even this week, then the books will be rebalanced with an unanticipated revenue.”
He claimed the general expenditure would fall below 100% once the town cashes its expected check, and that the budget probably should have already accounted for the Melendy Road Bridge. The presentation only accounted for expenditures up to July 15.
“I understand exactly what you’re saying, but there’s no authority to increase the budget after it’s passed that I know of,” said Committee member Shawn Jasper. “You can’t spend the money, even if it comes in, you can’t spend money without an appropriation.”
Sorenson conceded that the bookkeeping was a nearly unavoidable problem due to the timing of the state. He called the issue a “bookkeeping dilemma that will get ironed out in the audit,” but not a “legal dilemma,” despite persistent concern from Jasper and other members.
“We’re in some sort of conundrum,” said Committee member Bob Wherry. “I would like clarification from someone as to whether we are in violation, and if we are, what’s the proper remedy for it? As a member of the Budget Committee, I just want to make sure things are done right in the future.”
Committee member Kevin Walsh added that taking in unanticipated revenue was relatively common and that the expected upcoming audit would be the best way to solve the problem.
“The town voted to approve the engineering, but the project cost, where was that approved by the voters like anything else?” asked Jasper. “That’s still my concern.”
Chair James Lawrence suggested doing more research into the matter.
“There does not appear to have been authorization for the town to expend these funds for this particular project,” he said. “Unfortunately, I think this harkens back to a conversation we had previously about some of the methods that are being utilized to expend funds utilized for the Target development.”
The Budget Committee requested additional information for their next meeting to resolve their issues.
