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"To say this year's budget process is and will be challenging is probably the biggest understatement ever," Ms. Murphy said during her 10-minute address.
Town Finance Director Raymond Jankowski said that the projections for the next fiscal year indicate that the revenue would be "$2.9 million under the revenue for this current year."
"Wow," Democratic council member Walter Bayer said in an interview. "I don't know where we're going to come up with $2.9 million without taxes really escalating."
However, some of the Republicans on the Town Council said they hope that the upcoming budget deliberations will whittle the tax increase down to zero before the proposed budget goes to referendum in the spring.
"I think she's done a really thorough and excellent job of coming up with the necessary decisions to get us as close as possible to a zero percent tax increase," council Vice Chairman Roger Szendy, a Republican, said in an interview, as he praised the mayor's efforts.
"She's spent a lot of sleepless nights on this," he added.
"I think it is now up to the council and the Board of Finance to continue to think outside the box, which she already has done," said Republican council member Pete Bass, who indicated that his goal would be zero increase in the tax rate, which is currently at 22.52 mills.
Mr. Jankowski told the municipal officials that, to balance the budget for the fiscal year ending in June, the town has utilized $2 million in undesignated surplus and another $1 million in "internal service or the medical reserves."
In her address, Ms. Murphy said that her recommended budget for the fiscal year starting in July "does not contain monies from the undesignated because I believe that much discussion and research as to impact must be done with regard to bond ratings and future borrowings."
Mr. Jankowksi said in an interview that New Milford currently has an AA2 bond rating, which is the same as neighboring Brookfield.
Brookfield Town Treasurer David Scribner, who also serves as the state representative from the 107th state House District, has said that fewer than 20 of the state's 169 municipalities have a higher rating.
In an effort to contain costs, Ms. Murphy recommended that all municipal officials and nonunion employees forgo a pay increase during the next fiscal year.
Further, she said that there have been discussions with some of the municipal bargaining units regarding their contracts and that she planned to present "proposals and ideas" to the Town Council during an executive session that was scheduled for last night.
Ms. Murphy also called for "an aggressive marketing plan for surplus town properties."
She said that the Still Meadow parcel could be sold, which could satisfy the town's current $1.5 million debt and additionally generate new revenue since it could be "returned to productive uses on our local tax rolls."
Ms. Murphy also cited the Parks and Recreation Department's Sunny Valley Condo property.
She said that a year from now the Parks & Recreation Maintenance Department could be moved to the Old Ambulance building.
Ms. Murphy said that by selling or renting the property it would generate income rather "than the condo fees and utilities costs now expended."
On another topic, Ms. Murphy said that the town should follow Gov. M. Jodi Rell's (R-Brookfield) call for regionalization, and, to that end, she recommended that the town reconfigure its "emergency dispatch" by joining Litchfield County Dispatch, a move that could result in "a net savings of over $350,000 a year in personnel costs."
Additionally, the mayor said the move could save on the costs of upgrades to the dispatch center.
Ms. Murphy said that she and Mr. Jankowski would discuss the issue next week with state officials.
The mayor said that in recent months the town has taken several steps to reduce costs.
She said that officials have locked in oil, gas and diesel fuel costs for the next fiscal year that will save $300,000 to $400,000 for this year in the combined costs for the town government and the school district.
Ms. Murphy told the municipal officials that the training and implementation of various safety programs saved $100,000 on workmen's compensation.
Additionally, she said that a move to in-house printing of all town checks, purchase orders and other reports is netting a $25,000 annual savings.
Ms. Murphy said that the town has locked in electric costs that will yield a saving $35,000 for the period until December 2009 and is working with the school district to seek low rates for the period after that.
She said that the town changed its prescription drug coverage from Blue Cross/Blue Shield to Medco with no loss of benefit and an expected savings of $150,000 to $200,000.
Ms. Murphy also said that town has refinanced bonded debt, which has produced a savings of $300,000 during the next fiscal year.
Regarding possible revenues from the $787 billion federal economic stimulus package that President Barack Obama signed this week, Mr. Jankowski said that $144 billion would be allocated to states and local governments but that it appears that "it is not going to be able to supplant normal budget items."
Some municipal officials have said that infrastructure money from the stimulus might be utilized for the proposed renovations to the wastewater treatment facility on West Street and an addition to the town library near the Village Green, which hasn't had a major upgrade since 1979.
"How much revenue, how we get it and what the impact would be on this budget I can't say at this point," Mr. Jankowski said in reference to the stimulus package.
Mr. Bass applauded Ms. Murphy's efforts to submit a recommended budget that reflects the troubled economy.
"I appreciate her candor," he said.
'I think that she's done a good job of maintaining core services," Mr. Szendy said.
"New Milford is a town with a lot of people in the service industry and a lot of those people aren't working right now," he added regarding the need to lower tax increases during a time of higher unemployment.
However, Mr. Bayer said he's concerned about maintaining adequate services.
"What percentage the mill rate is going to go up I don't know," he said. "We can't shoot ourselves in the foot. We have to maintain Public Works and Social Services and the other departments."
