As affirmed by Standard & Poor’s last week, thanks to the mayor and council's “strong management” and “good financial policies and practices,” Westfield maintains a AAA credit rating, saving hundreds of thousands of taxpayer dollars. S&P specifically noted Westfield's “[s]trong budgetary performance, with an operating surplus,” in awarding us its highest credit score.
A budget surplus is like a "rainy day" fund, available for the town to meet unforeseen economic challenges. In recent years, these have included the Great Recession, cuts in state aid, the downturn in the housing market (and the resulting decrease in property tax revenue), Hurricane Irene and Superstorm Sandy.
Some may criticize Westfield's leaders for their sound fiscal management in building and maintaining a surplus. But has hastily spending surplus funds significantly improved the financial condition of our state and federal governments, or helped us as individual taxpayers?
We are all familiar with the advice of personal financial planners, who recommend having at least six months of savings to meet our household needs. It is even more important for our local government, which is entrusted with protecting our most important investments — our families and homes — to maintain sufficient reserves to benefit residents. Credit agencies generally recommend a fund balance of at least 25 percen of a municipality’s budget, or savings sufficient to cover roughly three months of local expenditures. By making prudent and sometimes difficult decisions, Westfield’s current leadership has built and maintained that amount in reserve.
In addition to providing financial protection, our surplus allows the town, among other things, to purchase needed public safety and public works equipment, and to make improvements to streetscapes and parks, without resorting to extensive borrowing. Our surplus keeps our credit rating high and our debt and interest rates low, reducing the burden on taxpayers.
So if you hear any local pundits or political candidates complain about Westfield's budget surplus or, worse yet, suggest many ways in which they would spend it, ask them whether they have a savings account to protect their families against unforeseen expenses and financial challenges. Ask them why they are willing to risk the Town's AAA rating and long-term financial health for short term political expediency. And tell them that, like Mayor Skibitsky, my council colleagues, and me, you are not willing to take that risk with Westfield’s future.
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