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ATTLEBORO - The city's free cash or surplus from last year has been certified at $2.8 million by the state's Department of Revenue - an increase of about $1.7 million over the average of the past several years.
But Mayor Kevin Dumas said the good news does not mean the city can loosen the reins on spending.
It does mean, however, that the city has a little more wiggle room in dealing with ongoing financial hardships, he said.
"In no way will there be a spending free-for-all," the mayor said. "What this does is give us an opportunity to continue on to manage fiscal year 2011, which will not be any easier than this year - and could be worse."
Free cash is the amount that remains in city coffers after the books are closed for a fiscal year. The total is usually certified by the state in the fall. Most of the $2.8 million is surplus from fiscal year 2009, which ended on June 30.
Meanwhile, the water and wastewater departments, which have budgets separate from the city, also finished with surpluses of about $1.1 million and $1.2 million, respectively.
Dumas said the city's general fund has been averaging about $1.1 million a year in free cash over the past four years. This year's increase comes from an unexpected surge in local receipts, which included excise taxes and some one-time payments to the city, Dumas said.
The total also includes about $350,000 from last year's free cash, which was rolled forward.
State revenue officials want cities and towns to maintain a certain amount of free cash from year-to-year to assure financial stability, so the city works to retain significant cash in its accounts regardless of continuing fiscal pressures, Dumas said.
At least $600,000 of the surplus will go into the city's stabilization fund to bring it back to the $1.5 million level of last year, before the city tapped into it to balance this year's budget, Dumas said.
And another $280,000 will be used to repay the school department for Medicaid disbursements.
Two small capital improvement projects will also be funded from the cash, Dumas said.
But big problems still darken the horizon, the mayor said.
City expenses are likely to increase next year, including payments on the $5 million borrowed for the new roof for the high school. And while some expenses will go up, receipts could go down.
Dumas said the city might still have to lower its local receipts estimate for this year. And, on the state side, the governor could still cut local aid later this year if state revenues continue to decline.
Also, winter looms with the prospect of expensive snowstorms, for which the city does not provide budget money and pays out of the following year's spending plan.
"We have to watch very carefully what's happening with the economy and plan for it," Dumas said. "There's a lot to balance here to make sure we can still go forward and do what we want to do for the people of the city."
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