RUMFORD — Town officials were busy Tuesday routinely double-checking town auditor Ron Smith’s 2010-11 audit of Rumford’s financial books.

Although Smith told selectmen last Thursday the audit revealed Rumford’s finances “are rock solid,” Treasurer Debbie Laurinaitis said she always examines such reports to check for discrepancies before selectmen vote to accept the document.

That is expected to happen at the board’s next meeting at 7 p.m. on Thursday, Dec. 15.

At the board’s Dec. 1 meeting, Smith said that as of June 30 Rumford was “still in strong financial condition.”

“You know you added a surplus of about $6.1 million as of June 30, 2011; some of that was committed funds, some of it was undesignated,” Smith, owner of RHR Smith & Co. in Buxton, said.

The undesignated portion totaled $3.3 million, he said.

“Where do we want to see that?” he asked, then answered saying, “We’d like to see it at 30 to 60 to 90 days of your operating budget, and your operating budget approximates about $16 million.”

That equals about $1.5 million to $4.5 million, Smith said.

“You’re on the strong side of 60 days, which is, I think, where I’d expect you’d want to be,” he said.

Town meeting voters used $1.1 million of that to balance the 2010-11 budget.

Smith cautioned selectmen about repeating that in the 2012-13 budget.

“You’re right where you want to be,” he said.

“I’m just afraid, given some of the news I’ve heard from the paper mill (NewPage Inc.), and given the state of this state, and given the fact of where you’re at right now, it’s pretty hard to grow a fund balance in this day and age, and I just think that as you move forward, stay tight to where you’re at.”

Smith then addressed Rumford’s fund balance policy.

He said the town has capital, infrastructure and other money set aside for designated accounts and suggested that it be reviewed.

“What I would advise the town is that you look at those things again,” Smith said. “The times have changed, so maybe it’s time to give them a different name, you know. Maybe it’s time to go back and fund your capital (account) the way it should be. So, there are pockets of money available.”

Leftover money from that review could still be used to buy down the tax rate, he said.

“We’re optimistic about what we see and you’ve got something that you can manage,” he said. “I think you put yourself in a good position.”

Smith then advised selectmen to take out a tax anticipation note, but not borrow the money yet. He said that because NewPage is undergoing bankruptcy reorganization, they might not pay the second half of their tax bill on time. It is due in April.

“Just in case something happens, it would just be a prudent thing to do,” Smith said. “I also think the town needs to look at a contingency reserve.”

Town Manager Carlo Puiia told selectmen that Smith met with Finance Committee members prior to the board’s meeting and discussed future management advice.

“Part of the discussion centered around the mill’s condition and Chapter 11 and I think the committee felt pretty good at the end of that meeting knowing that one, we are financially stable, but also understanding that we also have to make changes as we move forward to prepare for the future,” Puiia said.

He said Smith will assist Rumford along the way.

“It’s not like he’s just dropping our audit off and saying, ‘See you next summer,'” he said. “He’s working behind the scenes.”

“Consider this a beginning of many conversations,” Smith said.

Selectmen then tabled discussion to review the report.

tkarkos@sunjournal.com

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