Berlin Town FY2023 Board of Finance Budget Review & Strategy

Town of Berlin FY2023 Board of Finance Budget Review March 2, 2022

Agenda Agenda Overall Budget Board of Education Operating Budget Revenue Long-term Liabilities Capital Transfers General Government (incl BWC) Operating Budget 2

Overall Budget 3

Budget Strategy Budget Strategy 1. Exercise fiscal restraint to keep taxes down as much as possible 2. No new money borrowing to prepare for impending large projects 3. Structurally balanced budget while maintaining a high-quality educational system, public safety, infrastructure and honoring legal/contractual obligations 4. Focus limited capital requests on Schools, Public Safety & critical Infrastructure 4

Fiscal Year 2023 Overall Budget Proposal Fiscal Year 2023 Overall Budget Proposal Total Proposal: $99.4 million (+$5.5 million or +5.8%) Mill Rate: 35.91 mills (+1.98 mills) State Funds: based on Governor Lamont s budget proposal ECS flat to FY22 Budget does not include motor vehicle cap (Governor proposed motor vehicle cap at 29 mils) Uncertain if legislature will pass If the proposal passes, uncertain at what level the motor vehicle mil rate will be capped Budgeted Grand List: 1 mil is worth $2,438,139 +2.9% YOY increase - generates $2,272,318 incremental tax revenue (@ 33.93 mill rate) Expenditure Increase Revenue Offset ($1,200) ($722) $330 ($1,592) Net Tax Impact $1,200 $722 ($330) $1,592 Category Driver (in thousands) Transfer from Other Funds Non-Education State/Federal Grants Other Non-Tax Revenue Changes REVENUE INCREASE/(DECREASE) NOTES $0 $0 $0 $0 BHS Closeout one-time revenue $700k ARPA one-time revenue Fee increases Board of Education Operations General Government Operations Non-BOE Schools Operations (Private School & Dept 61) OPERATING COST INCREASE/(DECREASE) $2,237 $2,288 $401 $4,926 $0 $0 $0 $0 $2,237 $2,288 $401 $4,926 Capital Transfers Debt Service NON-OPERATING COST INCREASE/(DECREASE) $763 $10 ($217) $556 $0 $0 $0 $0 $763 $10 ($217) $556 POCD contract slightly higher than projected Assumes no new money issue June 2022 NON-TAX REVENUE INCREASE/(DECREASE) $1,592 $1,592 $0 5 TOTAL TAX INCREASE/(DECREASE) $7,074 $0 $7,074

Breakdown of Total FY23 Budget FY21 Actual Exp FY22 Original Bud FY22 Amended Bud FY23 FY23 Manager Bud Manager/ Original Chg Department Bud General Government Operations Capital Long-term Liabilties - Debt Service Long-term Liabilities - Defined Benefit pension plan Transfers $28,458 $253 $3,756 $2,185 $1,176 $35,827 $31,871 $370 $3,719 $185 $932 $37,077 $31,857 $370 $3,719 $5,496 $3,132 $44,573 $34,177 $673 $3,643 $185 $942 $39,620 $34,160 $673 $3,643 $185 $942 $39,603 $2,288 $303 ($76) $0 $10 $2,525 Education Operations Town staff supporting BOE Capital Long-term Liabilties - Debt Service Transfers $45,608 $4,180 $47,886 $4,591 $47,886 $4,605 $50,123 $4,992 $460 $4,264 $50,123 $4,992 $460 $4,264 $2,237 $401 $460 ($142) $0 $0 $0 $4,491 $1,333 $55,611 $4,405 $4,405 $0 $0 $0 $0 $0 6 $56,882 $56,896 $59,838 $59,838 $2,956

QUESTIONS? 7

Board of Education Budget Board of Education Budget 2022 2022- -2023 2023 March 2, 2022 March 2, 2022

BOE & Superintendents Goals for 2022-2023 Continue to provide quality education to all students at the standard that Berlin parents expect. Provide all students with an education that prepares them for multiple options and opportunities upon graduation. Maintain favorable class sizes and adequate course offerings. Consistent support for technology use with adequate funding of hardware, software, infrastructure, and IT support. An ongoing commitment to implementing safety measures, equipment and systems that provide all students and staff a safe learning environment. 9

2022-2023 Superintendent s Proposed Budget Overview Administrative Salaries Certified Salaries Non-Certified Salaries Employee Benefits 10

Budget Executive Summary $50,122,596.00 FY 22-23 Superintendent's Proposed FY 20-21 Budget FY 20-21 Actual FY 21-22 Budget as of 12/1/2021 Dollar Difference Percentage Difference Object Summary 10 11 Administrative Salaries $2,737,080.00 $2,772,037.00 $2,855,887.00 $2,974,826.00 $118,939.00 4.16% Certified Salaries $20,900,470.00 $20,997,178.00 $21,545,983.00 $22,521,627.00 $975,644.00 4.53% 12 Non Certified Salaries $7,472,905.00 $7,085,852.00 $7,646,170.00 $7,960,043.00 $313,873.00 4.10% 20 Employee Benefits $6,462,707.00 $6,430,651.00 $6,780,970.00 $7,156,529.00 $375,559.00 5.54% 30 Contracted Services $1,778,688.00 $1,848,494.00 $1,862,459.00 $2,034,382.00 $171,923.00 9.23% 40 Utilities $406,303.00 $330,009.00 $406,303.00 $418,370.00 $12,067.00 2.97% 51 Transportation $3,212,078.00 $2,460,948.00 $3,251,277.00 $3,332,355.00 $81,078.00 2.49% 56 Tuition $2,155,787.00 $1,948,765.00 $2,270,715.00 $2,380,288.00 $109,573.00 4.83% Supplies, Textbooks, & Materials 60 $1,074,100.00 $1,112,560.00 $973,450.00 $1,025,707.00 $52,257.00 5.37% 70 Equipment $154,200.00 $535,863.00 $176,979.00 $226,205.00 $49,226.00 27.81% 80 All Other Expenditures $62,186.00 $485,535.00 $115,439.00 $92,264.00 -$23,175.00 -20.08% Totals $46,416,504.00 $46,007,892.00 $47,885,632.00 $50,122,596.00 $2,236,964.00 4.67% 11

6 Year FTE Comparisons Teachers/Certified Staff 279.3 267.0 264.0 2016-2017 FTE 2017-2018 FTE 2018-2019 FTE 2019-2020 FTE 2020-2021 FTE Employee Type 2021-2022 FTE Teachers/Certified Staff 259.4 266.7 270.3 12

Initial Staffing Request for Operational Budget - $912,065 Total Initial Staffing Requests - $1,153,755 General Fund Requests Position FTE Estimated Salary Estimated Salary Central Office Central Office Districtwide Districtwide (PPS Department) Griswold Elementary School Griswold Elementary School Hubbard Elementary School Hubbard Elementary School Hubbard Elementary School McGee Middle School Special Education Special Education Willard Elementary School Willard Elementary School Office Assistant Increase of Hours HR Director I.T. Technician Paraprofessional Writing Interventionist Assistant Principal Writing Interventionist Social Worker Art Teacher Assistant Principal Elementary Teacher Registered Behavior Technician Writing Interventionist Assistant Principal 0.50 0.20 1.00 6.00 1.00 0.00 1.00 0.50 0.60 0.00 1.00 1.00 1.00 0.00 $37,425.00 $24,075.00 $65,000.00 $157,764.00 $64,189.00 $18,000.00 $64,189.00 $31,000.00 $38,513.00 $18,000.00 $64,189.00 $35,604.00 $64,189.00 $18,000.00 $12,322.00 $0.00 $23,890.00 $65,991.00 $19,365.00 $0.00 $19,365.00 $9,666.00 $11,600.00 $0.00 $19,365.00 $10,999.00 $19,365.00 $0.00 General Fund Subtotal 13.80 $700,137.00 $211,928.00 Grant & Other Fund Requests Districtwide District Elementary BHS Armed Security Guard Resident Teacher Work Based Learning Coordinator 1.00 1.00 1.00 $44,606.00 $67,500.00 $67,500.00 $23,354.00 $19,365.00 $19,365.00 Grant & Other Funds Subtotal 3.00 $179,606.00 $62,084.00 13 Total $879,743.00 $274,012.00

2022-2023 New Staff Request Summary 16.80Total Requests for New Staff 14.60Requests Not Funded 2.20Requested for Funding (Operational, Grant & Town) Operational General Fund .20 Increase to Director of Human Resources Town of Berlin 1.0 Armed Security Guard (BHS Night Shift) Open Choice Grant 1.0 Work Based Learning Coordinator 14

Budget Executive Summary $50,122,596.00 FY 21-22 Budget as of 12/1/2021 FY 22-23 Superintendent's Proposed FY 20-21 Budget FY 20-21 Actual Dollar Difference Percentage Difference Object Summary 10 11 Administrative Salaries $2,737,080.00 $2,772,037.00 $2,855,887.00 $2,974,826.00 $118,939.00 4.16% Certified Salaries $20,900,470.00 $20,997,178.00 $21,545,983.00 $22,521,627.00 $975,644.00 4.53% 12 Non Certified Salaries $7,472,905.00 $7,085,852.00 $7,646,170.00 $7,960,043.00 $313,873.00 4.10% 20 Employee Benefits $6,462,707.00 $6,430,651.00 $6,780,970.00 $7,156,529.00 $375,559.00 5.54% 30 Contracted Services $1,778,688.00 $1,848,494.00 $1,862,459.00 $2,034,382.00 $171,923.00 9.23% 40 Utilities $406,303.00 $330,009.00 $406,303.00 $418,370.00 $12,067.00 2.97% 51 Transportation $3,212,078.00 $2,460,948.00 $3,251,277.00 $3,332,355.00 $81,078.00 2.49% 56 Tuition $2,155,787.00 $1,948,765.00 $2,270,715.00 $2,380,288.00 $109,573.00 4.83% Supplies, Textbooks, & Materials 60 $1,074,100.00 $1,112,560.00 $973,450.00 $1,025,707.00 $52,257.00 5.37% 70 Equipment $154,200.00 $535,863.00 $176,979.00 $226,205.00 $49,226.00 27.81% 80 All Other Expenditures $62,186.00 $485,535.00 $115,439.00 $92,264.00 -$23,175.00 -20.08% Totals $46,416,504.00 $46,007,892.00 $47,885,632.00 $50,122,596.00 $2,236,964.00 4.67% 15

Contracted Services - $171,923 Includes all operational and educational systems which increase 3% to 7% annually Additional cybersecurity software required by insurance company Increase in legal fees & anticipated copier contract 16

Transportation - $81,078 Contractual increase for 2022-2023 school year is 3.45% with New Britain Transportation District intends to use a portion of Excess Cost funds to offset Special Education transportation 17

Tuition - $109,573 No funds have been budgeted for anticipated outplacements for 2022-2023. The anticipated increase for CREC Magnet School is 12% The budget assumes the current Pre-K (non-tuition students) will continue through the magnet school system as a tuition student in the next fiscal year Tuition $2,380,288.00 FY 21-22 Budget as of 12/1/2021 FY 22-23 Superintendent's Proposed FY 20-21 Budget FY 20-21 Actual Dollar Difference Percent Difference Description Comments Southington Vocational Agriculture Center $34,115.00 $27,292.00 $40,801.00 $36,250.00 -$4,551.00 -11.15% Tuition Summer School Out-Of-District Tuition- Public In State Out-Of-District Tuition- Private In State $0.00 $118,737.26 $0.00 $0.00 $0.00 0.00% $548,483.00 $257,990.25 $483,615.51 $410,243.00 -$73,372.51 -15.17% $1,261,813.00 $1,240,618.39 $1,434,485.02 $1,560,820.00 $126,334.98 8.81% Expulsion Program Magnet School Tuition for Berlin Residents $0.00 $0.00 $0.00 $15,450.00 $15,450.00 100.00% $311,376.00 $304,127.00 $311,813.00 $357,525.00 $45,712.00 14.66% 18 Totals $2,155,787.00 $1,948,765.00 $2,270,715.00 $2,380,288.00 $109,573.00 4.83%

All Other Expenditures - ($23,175) The District is taking a 0% increase from the original July 1, 2021 budget for All Other Expenditures. The budget, as of 12/1/2021, includes the Board approved $20,000 transfers for the Griswold Band Room. The proposed budget redistributes funds to the original category or to other line items within the All Other Expenditures category. Initial Requests to Superintendent included an additional $474,700 for equipment and facilities improvements which was cut by the Superintendent before the January 10th BOE Meeting. 19

Budget Executive Summary $50,122,596.00 FY 22-23 Superintendent's Proposed FY 20-21 Budget FY 20-21 Actual FY 21-22 Budget as of 12/1/2021 Dollar Difference Percentage Difference Object Summary 10 11 Administrative Salaries $2,737,080.00 $2,772,037.00 $2,855,887.00 $2,974,826.00 $118,939.00 4.16% Certified Salaries $20,900,470.00 $20,997,178.00 $21,545,983.00 $22,521,627.00 $975,644.00 4.53% 12 Non Certified Salaries $7,472,905.00 $7,085,852.00 $7,646,170.00 $7,960,043.00 $313,873.00 4.10% 20 Employee Benefits $6,462,707.00 $6,430,651.00 $6,780,970.00 $7,156,529.00 $375,559.00 5.54% 30 Contracted Services $1,778,688.00 $1,848,494.00 $1,862,459.00 $2,034,382.00 $171,923.00 9.23% 40 Utilities $406,303.00 $330,009.00 $406,303.00 $418,370.00 $12,067.00 2.97% 51 Transportation $3,212,078.00 $2,460,948.00 $3,251,277.00 $3,332,355.00 $81,078.00 2.49% 56 Tuition $2,155,787.00 $1,948,765.00 $2,270,715.00 $2,380,288.00 $109,573.00 4.83% Supplies, Textbooks, & Materials 60 $1,074,100.00 $1,112,560.00 $973,450.00 $1,025,707.00 $52,257.00 5.37% 70 Equipment $154,200.00 $535,863.00 $176,979.00 $226,205.00 $49,226.00 27.81% 80 All Other Expenditures $62,186.00 $485,535.00 $115,439.00 $92,264.00 -$23,175.00 -20.08% Totals $46,416,504.00 $46,007,892.00 $47,885,632.00 $50,122,596.00 $2,236,964.00 4.67% 20

ESSER II FY 2023 - $308,946 Total ESSER II Funds - $641,868 Department Description Estimate FY 22 Budget FY 23 Budget Curriculum Extended Learning Opportunities $142,922.00 $70,000.00 $72,922.00 Special Education ESS in Middle School $241,000.00 $118,000.00 $123,000.00 Districtwide "Common Ground" Partnership w/ Social Services $60,000.00 $30,000.00 $30,000.00 Districtwide Partially Fund Zoom License $105,946.00 $45,946.00 $60,000.00 Districtwide Family Communication Specialist $92,000.00 $45,000.00 $47,000.00 Totals $641,868.00 $308,946.00 $332,922.00 ESSER II is a two year grant with the expectation that funds will be expended by September 30, 2023. 21

ESSER ARP FY 2023 - $521,000 Total ESSER ARP Funds - $800,942 Department Description Estimate FY 22 Budget FY 23 Budget FY 24 Budget Extended Learning Opportunities- expand summer programs, including offering some summer courses at BHS Curriculum $339,942.00 $90,000.00 $115,000.00 $134,942.00 Curriculum RULER training and curriculum work $65,000.00 $35,000.00 $15,000.00 $15,000.00 Facilities Mental Health Suite- McGee $124,000.00 $124,000.00 WAN: Upgrade current fiber network between all buildings from 10gb to 40gb Districtwide $102,000.00 $102,000.00 Install fiber from Town Hall data closet to Board of Education data center. Districtwide $10,000.00 $10,000.00 BOE of Ed Data Center Switches should be upgraded to utilize 10-50gbps fiber runs Districtwide $40,000.00 $40,000.00 Berlin High School MER (Main Equipment Room) Core Switches- end of life and need to be replaced with current models and have throughput increased Districtwide $120,000.00 $120,000.00 Totals $800,942.00 $521,000.00 $130,000.00 $149,942.00 ESSER ARP is a three year grant with the expectation that funds will be expended by September 30, 2024. 22

Hartford Open Choice Enrollment Projected 2022-2023 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022 Choice Students 96 92 131 116 121 109 110 Total 2792 2781 2787 2735 2688 2678 2639 Enrollment % Choice Students 3.44% 3.31% 4.70% 4.24% 4.50% 4.07% 4.17% For the 2021-2022 school year, we offered 14 new seats for Choice students and 11 were filled. - 8 kindergarten students - 1 second grade, 1 third grade and 1 sixth grade all siblings/relatives of students Every effort is being made to accept students at the kindergarten level with a conscious awareness of maintaining at least 4% Choice Enrollment as these funds are tied to additional staff and programs. 23

Hartford Open Choice Anticipated Budget - $1,034,275 Percentage Difference Expense Type FY 2022 Budget FY 2023 Budget Dollar Difference Certified Salaries BHS Griswold Hubbard McGee Willard $176,734.00 66,495.00 0.00 92,630.00 162,499.00 $247,304.00 69,869.00 0.00 94,251.00 168,659.00 $70,570.00 3,374.00 0.00 1,621.00 6,160.00 39.93% 5.07% 0.00% 1.75% 3.79% 498,358.00 580,083.00 $81,725.00 16.40% Non Certified Salaries BHS Griswold Hubbard McGee Willard $36,911.00 55,958.00 38,592.00 47,760.00 105,082.00 $38,026.00 57,201.00 39,457.00 51,883.00 108,390.00 $1,115.00 1,243.00 865.00 4,123.00 3,308.00 3.02% 2.22% 2.24% 8.63% 3.15% 284,303.00 782,661.00 294,957.00 $875,040.00 10,654.00 $92,379.00 3.75% 11.80% Salaries Totals: $159,235.00 -10.51% 0.00% -9.01% Remaining Fund for Allocation Special Education Reserve Rent for CCTA $150,000.00 25,000.00 $175,000.00 $134,235.00 25,000.00 $159,235.00 -$15,765.00 0.00 -$15,765.00 24 Other Expenses:

Budget Funding History 25

Berlins adopted budgets in the past three years have compared favorably Adopted 2017-18 Adopted 2018-19 Adopted 2019-20 Adopted 2020-21 Adopted 2021-22 5 Yr. Average Increase District Rocky Hill 2.93% 4.54% 2.50% 3.84% 3.75% 3.51% Farmington 2.37% 2.54% 2.90% 3.35% 3.30% 2.89% Cromwell 2.00% 1.53% 3.29% 3.60% 2.97% 2.68% Berlin 1.58% 1.30% 3.21% 3.20% 3.17% 2.49% Wethersfield 0.75% 2.97% 3.50% 2.05% 0.53% 1.96% Glastonbury 0.00% 2.20% 3.16% 2.81% 1.60% 1.95% Newington 0.29% 3.40% 2.70% 2.67% 0.00% 1.81% 26

Superintendents Proposed Budget by Surrounding Districts Proposed 2022-23 Budget Adopted 2017-18 Adopted 2018-19 Adopted 2019-20 Adopted 2020-21 Adopted 2021-22 District Wethersfield 0.75% 2.97% 3.50% 2.05% 0.53% 4.98% Berlin 1.58% 1.30% 3.21% 3.20% 3.17% 4.67% Rocky Hill 2.93% 4.54% 2.50% 3.84% 3.75% 4.49% Cromwell 2.00% 1.53% 3.29% 3.60% 2.97% 3.81% Newington 0.29% 3.40% 2.70% 2.67% 0.00% 3.63% Glastonbury 0.00% 2.20% 3.16% 2.81% 1.60% 3.25% Farmington 2.37% 2.54% 2.90% 3.35% 3.30% 2.99% Average 1.42% 2.64% 3.04% 3.07% 2.19% 3.97% 27

NCEP - Net Current Expenditure per Pupil 28 * Revised on 2/15/2022 to included the most recent information available from the CSDE.

Berlin and State Per Pupil Expenditure In the 20-21 school year, state per pupil spending was $20,740, Berlin per pupil spending was $18,973 or $1,767 less than the state. 29 * Revised on 2/15/2022 to included the most recent information available from the CSDE.

Berlin and State Per Pupil Expenditure Wealth Ranking is 60th 30

All Town Revenue Sources 31 Data from the FY 2021-22 Town General Fund Budget, Adopted at Referendum 4/27/2021

Share of Revenue Sources Data from the FY 2021-22 Town General Fund Budget, Adopted at Referendum 4/27/2021 32

BOE Operational Funding Sources Data from the FY 2021-22 Town General Fund Budget, Adopted at Referendum 4/27/2021 33

3-Year History of Non-Lapsing Deposits Project Description FY 2018-2019 $200,000.00 $117,775.00 $37,225.00 $25,000.00 $380,000.00 FY 2019-2020 FY 2020-2021 Blast Classroom at McGee Refinish Gym Floors Paint McGee Gym Security Equipment Hubbard Fire Alarms McGee Rooftop HVAC Unit $150,000.00 $225,000.00 $375,000.00 McGee LMC Lighting Upgrade Paving of Willard Playground Hubbard Classroom Storage McGee Removal of Retaining Wall and Paving Additional Funding for McGee Rooftop HVAC Unit $150,000.00 $150,000.00 $50,000.00 $25,000.00 $25,000.00 $400,000.00 $1,155,000.00 Total 3-Year History for Non-Lapsing Deposit for Unfunded Capital Projects In fiscal years 2020 and 2021 the District was significantly impacted by the COVID-19 pandemic and substantial savings were realized. In both fiscal years, the District returned $400,000 to the Town. 34

3-Year History of End of Year Purchases Purchase Description FY 2018-2019 $127,730.00 FY 2019-2020 FY 2020-2021 McGee Camera & Video Management System Willard / Hubbard Camera & Video Management System Chromebooks $198,680.00 $107,250.00 $433,660.00 Staff Laptops iPads (200) MacBooks Adaptors Vans Facility Plan Updates Equipment for McGee Gym Painting Equipment $289,100.00 $81,590.00 $10,415.00 $15,000.00 $117,000.00 $31,500.00 $26,675.00 $571,280.00 Boardroom Remodel & Furniture New Building Signs (Districtwide) Cafeteria Equipment (Districtwide) Bleacher Repairs & Gym Floor Resurfacing and Equipment (Districtwide) BHS Camera Storage SonicWall Security iMacs for Art Departments iPads & Apple TVs (Districtwide) Exterior Door Repairs (Hubbard & McGee) $43,988.00 $38,000.00 $20,350.00 $26,693.00 $12,589.00 $20,750.00 $37,856.00 $49,037.00 $27,962.00 $277,225.00 Total 3-Year End of Year Purchase History $1,282,165.00 35

Budget Executive Summary $50,122,596.00 FY 21-22 Budget as of 12/1/2021 FY 22-23 Superintendent's Proposed FY 20-21 Budget FY 20-21 Actual Dollar Difference Percentage Difference Object Summary 10 11 Administrative Salaries $2,737,080.00 $2,772,037.00 $2,855,887.00 $2,974,826.00 $118,939.00 4.16% Certified Salaries $20,900,470.00 $20,997,178.00 $21,545,983.00 $22,521,627.00 $975,644.00 4.53% 12 Non Certified Salaries $7,472,905.00 $7,085,852.00 $7,646,170.00 $7,960,043.00 $313,873.00 4.10% 20 Employee Benefits $6,462,707.00 $6,430,651.00 $6,780,970.00 $7,156,529.00 $375,559.00 5.54% 30 Contracted Services $1,778,688.00 $1,848,494.00 $1,862,459.00 $2,034,382.00 $171,923.00 9.23% 40 Utilities $406,303.00 $330,009.00 $406,303.00 $418,370.00 $12,067.00 2.97% 51 Transportation $3,212,078.00 $2,460,948.00 $3,251,277.00 $3,332,355.00 $81,078.00 2.49% 56 Tuition $2,155,787.00 $1,948,765.00 $2,270,715.00 $2,380,288.00 $109,573.00 4.83% Supplies, Textbooks, & Materials 60 $1,074,100.00 $1,112,560.00 $973,450.00 $1,025,707.00 $52,257.00 5.37% 70 Equipment $154,200.00 $535,863.00 $176,979.00 $226,205.00 $49,226.00 27.81% 80 All Other Expenditures $62,186.00 $485,535.00 $115,439.00 $92,264.00 -$23,175.00 -20.08% Totals $46,416,504.00 $46,007,892.00 $47,885,632.00 $50,122,596.00 $2,236,964.00 4.67% 36

2022-2023 Superintendent s Proposed Budget Overview Administrative Salaries Certified Salaries Non-Certified Salaries Employee Benefits 37

A school district's budget reflects the commitment of the community to invest in the future invest in the future of our children. commitment The erosion of funding for education challenges the sustainability of Berlin as a competitive district with rich educational and extracurricular rich educational and extracurricular opportunities opportunities for our students. competitive school 38

Questions Questions 39

Revenue 40

Revenue Revenue Local taxes largest funding source - collection rate remains at 99.3% Fees 4.0% State Education Grants 5.9% Taxes 88.9% User fees increase: VNA +$100k Town Clerk +$95k State/Federal Non-Education Grants 0.4% Funds FY22 one-time sources: BHS project tfr $1.2 million ARPA grant $700k Svc Fees & Inv Earnings 0.3% Use of Fund Balance 0.5% Transfers In 0.0% Fund balance only used to fund Pension admin. & contingency 41

Unassigned Fund Balance Projection Unassigned Fund Balance Projection Town of Berlin General Fund Unassigned Fund Balance Projection As of March 2022 As a % of FY22 budget 19.5% Source/Notes $18,300,008 6/30/2021 GF Unassigned Fund Balance from audited Annual Comprehensive Financial Report ($7,510,640) $2,250,000 -8.0% 2.4% Non-budgeted appropriation Projected FY21 Year-end GF surplus/(deficit) FY22 DB pension payouts & new fire vehicle purchases on-going operations only $13,039,368 13.9% Projected 6/30/2022 GF Unassigned Fund Balance USES OF UNASSIGNED FUND BALANCE Net DB Pension Liability Fire vehicles Reimbursable Grants: Senior/Community Center Planning School Security Vestibules Brownfield (Regional & Municipal) Kensington Sidewalks III + Connectivity Grant LoCIP - roofs @ PW Complex DEEP Athletic Facilities Improvements Grant ($1,779,570) ($950,000) -1.9% -1.0% Unfunded liability as of 1/31/2022 Replacing fourth 20-year old fire vehicle ($604,090) ($270,088) ($712,012) ($517,000) ($319,000) ($2,774,254) -0.6% -0.3% -0.8% -0.6% -0.3% -3.0% Full grant ($750k) minus 4/21 reimbursement ($145,910) Awaiting reimbursement from the State Awaiting final reimbursement for Reg, $538k remains on Mun Proj Grant LOCIP grant approved by OPM, work to occur spring 2022 Awaiting final signatures from DEEP/AG, scoreboard (spring 2022), Biscoglio (spring 2023) $5,113,354 5.4% Available GF Unassigned Fund Balance ($5,222,141) Excess/(Deficiency) to 11% Floor (vs FY 22 Budget) $93,959,047 $10,335,495 Adopted FY22 Budget 11% GF Unassigned Fund Balance Floor $99,343,572 $10,927,793 Proposed FY23 Budget 11% GF Unassigned Fund Balance Floor Potential future demands on fund balance: fire vehicles, school air quality, school vans, Griswold portables, Timberlin clubhouse and/or maintenance building, and backstop: Berlin Water Control, insurance funds and special education costs 42

$2.25 million projected surplus major drivers $2.25 million projected surplus major drivers Driver Projected Surplus Amount Notes Tax revenue: tax sale pmts.: $450k suppl. MV: $350k prior yr. pmts.: $200k fav. court settlements: $200k $1.2 million One-time revenue COVID catch-up No court in FY23 budget Town Clerk fees $225k Incr. in FY23 budget Building inspection receipts $150k VNA receipts ($130k) FY22 staff challenges Incr. $230k in FY23 budget Unanticipated position vacancies: Police: $100k VNA Director: $60k Physical Therapist: $55k $300k (net of vac payouts) WC process chg. in FY23 Removed from FY23 budget Tied to FY23 bud rev increase Contractual services (schools & town) $165k Electricity (schools & town) $140k Fringes from unanticipated position vacancies: $120k $45k DC pension forfeit Board of Education $0 Assumes budget expended or 2% request for deferred capital 43

QUESTIONS? 44

Long-term Liabilities 45

Long Long- -Term Liabilities Term Liabilities Items in this category: Notes Bonds Capital Leases Unfunded Pension Costs Debt Service Costs $217k year-over-year decline in debt service costs $8.6 million or 8.7% of total budget: Down 0.7pp (from 9.4% in FY 22 adopted budget) Goal is 4% or less of total budget Significant pension payments ($5.3 million) in FY22 relieved pressure on FY23 budget, but reduced unassigned fund balance 46

Long Long- -Term Liabilities Term Liabilities - - Debt Debt Town of Berlin Total Debt Schedule - Existing Debt ONLY FY2023 Budget Targeted total debt ceiling of $40,000,000 is projected to be attained by June 30, 2026 with no new borrowing in FY22-26 Capital Leases2,3 Outstanding GO Bonds Principal Interest Outstanding BANs CDA Loan1 Total Debt & Debt-Like Balance GO (P&I) Change BAN Change CDA Loan Change Capital Leases Change Total Debt Change June 30, Total Principal Interest Total 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $13,260,000 $28,835,000 $27,215,000 $34,020,000 $49,450,000 $60,905,000 $73,340,000 $73,645,000 $68,300,000 $68,935,000 $66,535,000 $60,425,000 $2,122,379 $7,776,263 $6,764,163 $8,311,185 $12,910,677 $17,468,530 $18,937,747 $17,266,598 $14,799,258 $13,495,943 $12,320,382 $10,201,207 $15,382,379 $36,611,263 $33,979,163 $42,331,185 $62,360,677 $78,373,530 $92,277,747 $90,911,598 $83,099,258 $82,430,943 $78,855,382 $70,626,207 $9,970,000 $6,317,000 $9,426,000 $1,325,000 $1,259,000 $1,180,000 $900,000 $1,455,000 $2,028,000 $931,000 $532,477 $492,423 $450,166 $405,584 $358,550 $308,930 $256,580 $201,352 $143,086 $81,615 $16,763 $0 $0 $25,884,856 $43,816,899 $44,238,230 $44,533,448 $64,464,574 $80,327,331 $107,729,736 $106,107,893 $98,036,871 $95,623,775 $90,449,655 $81,590,119 $388,800 $368,238 $457,141 $468,168 $447,429 $10,584,544 $10,234,306 $9,754,432 $9,451,657 $9,123,589 $8,774,978 $7,413 $14,663 $14,538 $18,179 $17,442 $3,710,865 $3,305,637 $3,012,095 $2,728,560 $2,453,921 $2,188,934 $396,213 $382,901 $471,679 $486,347 $464,871 $14,295,409 $13,539,943 $12,766,527 $12,180,217 $11,577,510 $10,963,912 $21,228,884 ($2,632,100) $8,352,022 $20,029,492 $16,012,853 $13,904,217 ($1,366,149) ($7,812,340) ($668,315) ($3,575,561) ($8,229,175) ($3,653,000) $3,109,000 ($8,101,000) ($66,000) ($79,000) ($280,000) $555,000 $573,000 ($1,097,000) ($931,000) ($40,054) ($42,257) ($44,582) ($47,034) ($49,620) ($52,350) ($55,228) ($58,266) ($61,471) ($64,852) ($16,763) $396,213 ($13,312) $88,778 $14,668 ($21,476) $13,830,538 ($755,466) ($773,416) ($586,310) ($602,707) ($613,597) $17,932,043 $421,331 $295,218 $19,931,126 $15,862,757 $27,402,405 ($1,621,843) ($8,071,022) ($2,413,096) ($5,174,120) ($8,859,535) $0 $0 $0 $0 Projected (assuming no additional bonding) 2022 $54,145,000 2023 $47,825,000 2024 $41,465,000 2025 $35,080,000 2026 $28,970,000 2027 $24,525,000 2028 $20,090,000 2029 $16,135,000 2030 $12,860,000 2031 $9,665,000 2032 $7,005,000 2033 $4,350,000 2034 $2,085,000 2035 2036 $8,356,819 $6,774,869 $5,434,944 $4,297,082 $3,357,016 $2,579,413 $1,924,944 $1,385,081 $943,575 $594,475 $332,666 $153,547 $52,719 $10,275 $62,501,819 $54,599,869 $46,899,944 $39,377,082 $32,327,016 $27,104,413 $22,014,944 $17,520,081 $13,803,575 $10,259,475 $7,337,666 $4,503,547 $2,137,719 $695,275 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $8,398,463 $7,992,653 $7,555,701 $7,086,452 $6,586,138 $6,052,948 $5,482,870 $4,874,121 $4,224,450 $3,532,279 $2,795,583 $2,011,856 $1,179,259 $376,390 $1,934,371 $1,691,053 $1,459,856 $1,241,704 $1,037,550 $848,279 $674,908 $518,524 $380,281 $261,392 $163,113 $86,770 $33,756 $5,517 $10,332,834 $9,683,707 $9,015,558 $8,328,157 $7,623,688 $6,901,227 $6,157,777 $5,392,645 $4,604,731 $3,793,671 $2,958,696 $2,098,626 $1,213,015 $381,907 $72,834,653 $64,283,576 $55,915,502 $47,705,239 $39,950,704 $34,005,640 $28,172,721 $22,912,726 $18,408,306 $14,053,146 $10,296,362 $6,602,173 $3,350,734 $1,077,182 ($8,124,388) ($7,901,950) ($7,699,925) ($7,522,862) ($7,050,066) ($5,222,603) ($5,089,469) ($4,494,863) ($3,716,506) ($3,544,100) ($2,921,809) ($2,834,119) ($2,365,828) ($1,442,444) ($695,275) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 ($631,078) ($649,128) ($668,149) ($687,401) ($704,469) ($722,461) ($743,450) ($765,132) ($787,914) ($811,059) ($834,975) ($860,070) ($885,610) ($831,108) ($381,907) ($8,755,466) ($8,551,078) ($8,368,074) ($8,210,263) ($7,754,535) ($5,945,064) ($5,832,919) ($5,259,995) ($4,504,420) ($4,355,159) ($3,756,784) ($3,694,189) ($3,251,438) ($2,273,552) ($1,077,182) $685,000 $0 $0 $0 $0 $0 $0 $0 1 Pricipal payments only displayed. Proceeds from CDA loan were used to remediate Legions Square property. Final debt payment is due in Fiscal Year 2021. 2 Balance represents the net present value of future minimum lease payments. 3 In February 2016, the Town entered into a 20-year energy lease program. The savings from the program is intended to repay the capital lease obligations. Final payment is due in December 2035. Source: Annual Comprehensive Financial Reports Propose no bonding in June 2022 - prepare for future bonding Elementary schools HVAC project: $10+ million (3 schools but 1 funded with ARPA grant) Fire vehicle: $900k Swimming pools/pool buildings: $500k-$1 million+ New Police station/Renovate existing Police station: $5 million+ New senior/community center: $40 million? New clubhouse at Timberlin: $2 million+ New portable classrooms at Griswold: TBD 47

After FY26, start retiring debt issues After FY26, start retiring debt issues BOND PRINCIPAL May-13 2013 505,000 505,000 505,000 500,000 500,000 495,000 385,000 385,000 385,000 385,000 385,000 May-14 2014 1,000,000 1,000,000 995,000 995,000 995,000 995,000 995,000 865,000 865,000 865,000 865,000 865,000 May-15 2015 725,000 725,000 725,000 725,000 725,000 720,000 720,000 720,000 720,000 720,000 715,000 715,000 715,000 May-16 2016 1,030,000 1,030,000 1,030,000 1,030,000 810,000 810,000 805,000 805,000 805,000 690,000 690,000 685,000 685,000 685,000 May 2016 Ref 2016 Ref 1,490,000 1,530,000 1,560,000 1,340,000 May-17 2017 450,000 450,000 450,000 450,000 445,000 445,000 80,000 80,000 Jun-19 2019 700,000 700,000 700,000 650,000 550,000 550,000 550,000 Jun-20 2020 420,000 420,000 420,000 420,000 420,000 420,000 420,000 420,000 420,000 TOTAL FY2023 FY2024 FY2025 FY2026 FY2027 FY2028 FY2029 FY2030 FY2031 FY2032 FY2033 FY2034 FY2035 FY2036 6,320,000 6,360,000 6,385,000 6,110,000 4,445,000 4,435,000 3,955,000 3,275,000 3,195,000 2,660,000 2,655,000 2,265,000 1,400,000 685,000 First Drop Second Drop Third Drop Fourth Drop TOTAL 4,935,000 11,300,000 9,370,000 11,590,000 5,920,000 2,850,000 4,400,000 3,780,000 54,145,000 48

Long Long- -term Liabilities term Liabilities Closed DB Pension Plan Closed DB Pension Plan $3,000,000 FY23 ADC was funded with July-Sep 2021 payouts only administration and annuity payments are in this proposed budget $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2018 2019 2020 2021 2022 Normal Cost Past Service Cost 6/30/2021 funding level 19% Census (1/1/2022): Active workers: 5 Inactive, Retirees and Beneficiaries: 15 Actuarially Determined Contribution (ADC): $2,664,914 $100k normal cost $2,565k past service cost Fully funded ADC for both years in July/September 2022 to cover retirements 2022 ADC: $2,395,640 2023 ADC: $2,664,914 49

QUESTIONS? 50