An audit of Waitsfield's 2010 budget contained some good news - an unexpectedly large surplus of $160,000. The select board discovered the surplus after the recent audit - having expected a 2010 surplus of about $96,000.

The select board, at its February 7 hearing, accepted the new audit figures and passed a final proposed 2011 budget of $1,654,729. The surplus does not impact the proposed budget that will come before voters at Town Meeting on March 1, but it could result in a lower town tax rate when that rate is set this summer, according to Town Administrator Valerie Capels.

"The audited figures we received show an unexpected $160,000 surplus and the budget last month showed a surplus in the area of $96,000. We actually expected that to go down as more December bills/payouts were factored in," Capels said.

Town Auditor Bill Yacavoni reported to the select board that the surplus is a result of three factors.

In 2010, the town experienced lower operating and capital expenses than expected - saving $30,491. The town received higher revenues than expected in 2010, by $47,736 - including a zoning violation settlement of $35,000.

Additionally the town's 2010 tax revenues were $32,338 higher than projected. That particular surplus consists of $9,756 in administrative fees that the town gets to keep for Act 60 related expenses, $5,837 related to a local agreement portion of the tax bill and payment of delinquent taxes.

The select board, at its February 7 meeting, discussed whether to recalculate expenses for 2011 based on the surplus or whether to carry the surplus forward into 2011. Traditional and acceptable accounting practices for towns allow such carry forwards.

Sometimes towns opt to use surpluses to decrease the next year's tax rate or select boards may opt to use the surplus for capital reserve items or to hold as a surplus to buffer taxpayers from tax rate spikes caused by emergencies or equipment failures.

Waitsfield's current capital budget includes $40,000 be set aside for the heavy equipment reserve truck - earmarked for a truck. Another $20,000 will go into that fund as a general reserve contribution. Last year, voters approved $55,000 towards a new truck and $15,000 for the general fund. The capital budget program also calls for $18,000 for a fire department reserve fund - earmarked for a new truck with another $25,000 going to a fire department general reserve fund. Last year voters approved $15,000 and $6,000, respectively, for those funds.

This year the town proposed that $5,000 be set aside for the town's restroom recreation/conservation fund, down from $10,000 last year. After earmarking $2,500 for the Joslin Library Repair/Reserve fund last year, the town is not proposing a contribution to that fund this year. After adding $5,000 to the town's Route 100 transportation path reserve fund last year, the board is proposing $20,000 this year.