Sent: Tuesday, June 15, 2004 3:24 PM
To: Harrison, Thomas F.
Cc: 'Richard W Hines'; 'Peggy Roell'
7. Turning now to question #2, the Town Attorney asserts that the "use of the word "may" appears to impose
only a discretionary duty upon a board to appropriate a surplus of revenue." Please note that in Caulfield, the
Supreme Court took "no position as to the correctness of the Holmes decision" in view of its decision that the
statutory interpretation of Holmes was "inapplicable to the present case." Accordingly, Caulfield cannot be used to
amend the decision in Holmes v Beckwith. In Holmes, the following principle still stands:
"The cash surplus in the general fund at the end of the fiscal year should be applied in reducing the amount of
the estimated expenditures for the ensuing year in order to determine the rate of tax to be laid upon the taxable
property for such year."
8. In view of comments #1 and #7 above, I reiterate my position that the Board of Finance of the Town of Avon
does not have any authority to transfer end-of-year surpluses into a surplus account.
9. It follows that without such authority, end-of-year surplus must be used to reduce estimated expenditures for
the ensuing year.
10. It also follows that without such authority, the accumulated amounts in the surplus account were "unauthorized."
Finally, I would like to state that it does not matter that "169 towns in the State of Connecticut maintain surplus
funds of the sort maintained by the Town of Avon." As we have seen from Caulfield, some of those towns may have
proper authority (from the Town Charter) to maintain those surplus funds. The Town of Avon does not.
The maintenance of surplus funds was not specifically granted to municipalities under section 7-148 and, therefore,
that authority must be specified in some other body of law or specifically approved by the taxpayers. Under the
principle of statutory construction, where there is a list of actions that have been authorized by the statutes, any
action that was not included in the list must be deemed to be excluded.
As I mentioned in another message, I agree that the maintenance of a surplus fund is good and prudent fiscal
policy. In the case of the Town of Avon, the amount of money kept in this fund however is a matter of fiscal policy
and not law. Absent any statutory authority, taxpayers must approve the practice on an annual basis.
I am once again requesting the Board of Finance to cure the deficiencies in the construction of the budget for the
fiscal year 2004-05 before submitting the question to a third referendum. Details are in my e-mail dated June 10,
2004.
Respectfully,
V Santos
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