Topsfield Public Works

The main issue with developing the Water Department budget for FY2012 was the conversion of approximately 1 million dollars of short term debt to a long term bond.  Short-term debt and free cash were used to fund water main replacements on Gail Street, Grove Street, High Street Extension and on portions of Haverhill Road, Ipswich Road, North Street, Main Street, Mansion Drive, Washington Street and Woodside Road.  The debt portion of these projects was initially funded using short term bans which require interest only payments for the first 3 years.

The Finance Committee issued their guidelines and it was clear that in order to reduce the effects of the new debt payments on water rates more aggressive cost cutting action was required.  To this end the following steps were taken:

1. A 32 hour per week System Technician position that included health care and pension benefits was reduced to a seasonal position without benefits.  It was determined, based on experience in 2010 and 2011, that the position was no longer needed.  This was primarly due to changes in personnel and the completion of several large water main projects and the meter replacement project.
2. The cost of Potassium Hydroxide (KOH) had dropped from over $7 dollars per gallon to $5 dollars per gallon reducing our water treatment costs.  We add approximately 1 gallon of KOH to every 20,000 gallons treated.  The costs of using this chemical add up quickly since we treat approximately 145 million gallons per year.  Most of the savings was redistributed to overspent line items in the "Other" section of the operating budget but the sub-total of the "Other" section decreased slightly as compared to FY2011.
3. Our Indirect Costs were substaintially lower compared to previous fiscal years.  This is primarily due to the System Technician and System Operator positions being unfilled for periods of time during FY2010.  As noted above, the System Technician position was reduced to a season position that does not include any benefits.
4. The Reserve Fund was reduced by 12% to keep the overal budget increase to less than 2%.