By Ally Lanasa, Staff Writer

(Oct. 29, 2020) Berlin Finance Director Natalie Saleh provided a budget lesson to the newly elected councilmembers last Wednesday, explaining during a work session that the annual budget book contains a balanced budget for each fund.

The budget is broken down into five independent funds: general, electric, water, sewer and stormwater.

“Each fund operates individually on its own set of revenues,” Saleh said. “The enterprise funds, if you think about it, they act as a business. They’re utility funds. General fund operates on the revenues received from the taxpayers, grants and interfund transfers.”

According to the FY19 audited financial statements, the general fund includes non-spendable funds, restricted funds, committed funds, assigned funds and unassigned funds.

“Monthly, you will receive a profit and loss report from me,” she said.

Saleh added that the mayor and council will also receive quarterly reports with her input about the budget.

“Sometimes emergencies happen, especially in winter. Pipes busted and we spend a lot more than what was projected to be spent,” Saleh said.

Six months into the fiscal year, Saleh will also give a presentation to the mayor and council about the budget.

Town staff must follow purchasing policies, which were revised and adopted around 2015.

“Requisition is initiation for a purchase,” Saleh said. “Before you even think about it, you have to decide ‘Ok, can I buy it? Is it within my purchasing powers? It is necessary?’”

Each department has limits for purchases. A person who is authorized to make purchases is allowed $1,500, department heads are allowed $5,000 and Town Administrator Jeff Fleetwood is allowed $10,000.

“Anything above that it is out of the ordinary, meaning that it is not an established contract with a repetitive vendor or something [that had been] approved already at the beginning of the year would have to go in front of you for discussion and approval,” Saleh said.

After a requisition is created, the department has the right to make the purchase or request a service, she added.

“A purchase order will be attached to the invoice and processed for payment,” Saleh said.

Furthermore, departments have the right to request to move funds from one line item to another line item as long as the total budget remains balanced, Saleh said.

Then, Saleh reviewed the audited financial statements through FY19 with the mayor and council. She said FY20 audited financial statements will be presented in December.

Berlin works with public accountants from PKS & Company and an independent auditor to annually review the town’s financial statements. Saleh said within the last decade, the town has not received any negative comments.

“Going in the packets this week is a change to the way we’ve done business over the last few years,” Fleetwood said. “Mayor Tyndall has asked that—and I’m going to make it simple—the check register will be in the packet for you all and the general public as well.”

Saleh added that she also emails the detailed check registry report to the mayor and council weekly or biweekly.

“Basically, the check register is a weekly summary of the expenses, what we paid out from the town,” she said.

Mayor Zackery Tyndall offered a tip to better understand the town’s financial documents.

“The budget looks forward at where we would like to go, and then the audited financial statements look backward at where we’ve been,” he said.

Saleh ended the lesson by urging the new councilmembers not to imply any promises regarding utility billing.

“Please defer all of the citizens to the billing department first to resolve the issue,” she said. “It is the duty of the staff to resolve this issue.”

Fleetwood also said the electric utility rates are regulated by the state.

For more information, visit berlinmd.gov for the audited financial statements through FY19 and the FY21 Budget Book.