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INVESTMENTS: During the course of the past year the bulk of our municipal portfolio remained with Legg-Mason which currently handles most of our capital reserve accounts in accordance with the Town's investment guidelines as well as those established by the State of Maine. However, we have increased our level of investments with the MBIA Maine Class Trust including moving several of our dedicated reserve accounts from Legg-Mason to MBIA. MBIA is an organization that specializes in providing conservative investment vehicles for municipal governments and school districts. All reserve accounts are now identified separately and reported on monthly. Our investments with MBIA have provided a relatively high level of liquidity and reasonable return. We also invest locally with area banking and savings institutions for much of our short term operating fund requirements. Local investment vehicles are generally in the form of Certificates of Deposit. Our goal is to increase diversification and achieve moderate long term growth. During the last 12 months we have managed to remain on a very solid footing relative to our investments, in spite of the unusual fluctuation in the stock market. RESERVE ACCOUNTS: ABBOTT MEMORIAL LIBRARY: This account was established to address major expense items related to upkeep of the Abbott Memorial Library and its grounds. We plan to use approximately $2,500 from this reserve account during FY 2003 to pay for repairs to the Library rear entrance walkway. The current balance of this fund is approximately $12,800. Total new contribution to reserve account: $ 0 AIRPORT RESERVE FUND: We continue to budget for upgrading the airport in accordance with our Airport Master Plan. Our long-range goal is to continue with an incremental upgrade of this facility. Our Airport Master Plan is currently under revision. Although the State will provide the bulk of funding for this project, our local match will amount to approximately $15,000. We will have expended $10,000 toward the match requirements in FY 2002 with the balance to be paid to the state in FY 2003. We currently have a balance of $12,500 in this account. Total new contribution to reserve account: $ 10,000 AMBULANCE EQUIPMENT RESERVE: This account is designed to accumulate funds for the acquisition of major equipment items for the Dexter Ambulance Service. Virtually the entire account was liquidated in FY2000 to help offset the purchase price of a new ambulance for the service. The goal is to accumulate funds at a rate that will allow the purchase of a new vehicle every five years. There is currently $20,500 available in the account. Total new contribution to reserve account: $ 0 ASSESSING: This account is established for a future property revaluation and to offset the cost of other planned projects related to the assessing function. There is $6,300 currently available in the account. Total new contribution to reserve account: $ 2,000 BUILDING IMPROVEMENTS: This is the fifth year of our program to escalate the contribution of funds to address critical building maintenance and facility upgrade requirements. A summary of those capital projects is attached. There is currently approximately $49,000 available in the account. We plan to withdraw $8,000 from the account in FY2003 to help fund the installation of a new furnace in the Morrison Memorial Building. Total new contribution to reserve account: $24,000 FIRE TRUCK : This reserve fund is established to support the replacement of the department's fire trucks. Fire trucks are generally purchased in seven-year cycles. The last fire truck purchased for our Fire Department was in 1996. Depending on the type, the new vehicle could cost as much as $200,000. There is currently approximately $115,500 available in the account. Total new contribution to reserve account: $15,000 FIRE EQUIPMENT: This is a reserve account established in FY 2002 that is designed to build funds for the future acquisition of major equipment items for the Department other than vehicles. Current account balance is $1,000. Total new contribution to reserve account: $3,000 MUSEUM: We established a Capital Reserve Account for the Dexter Historical Society five years ago with an initial contribution of $3,000. The primary purpose of the account is to set aside funds for major building repairs. Most of the account was liquidated in FY 2002 to help pay for a new roof for the building. Current account value is approximately $1,000. Total new contribution to reserve account: $1,000 HIGHWAY EQUIPMENT/FACILITIES: This account was established to allow for the planned annual contribution of funds to support major equipment purchases for the Public Works Department. The total amount currently available in this account is $67,500. Total new contribution to reserve account: $10,000 ORDINANCE CODIFICATION: This account was created to comply with requirements in the Charter which mandate codification of all ordinances as part of the Town Code. The current account balance is approximately than $1,100. Total new contribution to reserve account: $ 0 POLICE EQUIPMENT RESERVE: This reserve account is designed to accumulate funds to support the purchase of major equipment items to support Police Department operations. We generally purchase new police cruisers on an 18-month cycle and a new cruiser was purchased in FY2002. The account is currently valued at $300. Total new contribution to reserve account: $15,000 SIDEWALKS: This fund is designed to help support the costs of major repairs and replacement of sidewalks. The current account value is approximately $19,500. Total new contribution to reserve account: $ 0 PAVING RESERVE: This account was established to provide funding to support long term projections for maintenance paving of Town streets and roads. The current value of the account is approximately $90,000. Total new contribution to reserve account: $50000. INFORMATION MANAGEMENT CAPITAL RESERVE: We created this capital reserve account in 1998 to set money aside annually for the future acquisition of computers, printers, software, copiers, communications systems, and data management systems. We completed the second phase of the planned upgrade of our personal computers in FY2002. Although we planned to acquire an automobile registration system and networking in FY2002, the prohibitive cost will necessitate slipping that program acquisition until FY2004. This account currently has a value of approximately $9,000. Total new contribution to reserve account: $3,000 BRIDGE CONSTRUCTION CAPITAL RESERVE: Funds are utilized to perform major maintenance, support local reconstruction efforts, and match state funds associated with construction grants. There is a possibility that we may have to withdraw funds from this account during FY 2003 to provide matching funds for a planned DOT bridge refurbishment project. This account currently has a value of approximately $29,000. Total new contribution to reserve account: $ 0 FACILITIES EQUIPMENT CAPITAL RESERVE: This is a reserve account intended to be used for the programmed purchase of equipment for Facilities Maintenance. We withdrew funds from the account in FY 2000 to purchase a vehicle to support the Department's operation. There is currently approximately $6,000 in this reserve account. Total new contribution to reserve account: $3,000 GOLF COURSE CAPITAL RESERVE: This is a reserve account established to support long range capital improvement programs associated with the Dexter Municipal Golf Course. Intended programs include major equipment purchases and course improvements. The account is currently valued at $9,400. Total new contribution to reserve account: $ 3,000 CLERK'S RESERVE: This reserve accound was established to cover the cost of procuring electronic voting machines and other voting equipment. The account is currently valued at approximately $1,100. Total new contribution to reserve account: $ 0 LANDFILL MONITORING RESERVE: This reserve fund is being established in FY 2003 to set aside funds for the anticipated major maintenance and repair to the closed municipal landfill. There is currently a zero balance in this new account. Total new contribution to reserve account: $ 5,000 CEMETERY RESERVE: This is an established reserve fund that was previously managed by the Cemetery Corporation. Portions of the reserve may be used to help offset the cost of operating the cemetery. We anticipate withdrawing approximately $25,000 from the fund to support cemetery operating costs during FY2003. The current value of the reserve fund is approximately $450,000. Total new contribution to the reserve account: $ 0 SUMMARY: Because of increased demands on the FY2003 operating budget we were forced to substantially reduce our planned contributions to reserve funds. Unfortunately, when we have aging facilities and equipment that we're planning to replace, such a reduction is painful, however the need to offset operating costs during the coming year is also a recognized problem. If capital reserve accounts continue to be underfunded we'll simply be delaying the inevitable price of providing for the long-term needs of the community. Most of the demand for these funds will be going to essential items such as boiler and roof replacement, ADA and safety compliance, and the replacement of aging equipment.
* Withdraw $10K in 4th qtr FY2002 to support match funds for Airport Master Plan |