During the second night of budget hearings, Milford City Council heard from Acting Finance Director Kevin Gaboriault and Lou Vitola, Finance Director, information on the budget for their department. One of their requests was an additional staff member which, like requests from the Clerk’s Office and Parks & Recreation, was met with questions from council. Gaboriault began the presentation with details on the finance budget.
“One of the increases we see this year is software cost allocation that increased $9,270 and the other change to finance was the increase in investment fees,” Gaboriault said. “The investment fees for the general fund are allocated to finance and that was $13,128. Jumping ahead to personnel costs, most of my presentation is on that because I know council is looking with further detail this year.”
Gaboriault explained that personnel costs in the finance department grew by 18 percent and that was due to a request for an additional person. The new staff member would be an accounting person.
“I don’t recommend this lightly,” Gaboriault said. “But this position is needed in accounting to deliver the reports, the financial audits, in a timely manner. Currently, we have five team members in finance. We have an accounts payable coordinator, payroll coordinator, accountant, senior accountant and director. This new position will be responsible for bank reconciliations, investment reconciliations. The city processes thousands of transactions a day through the utility deposits and property taxes.”
Gaboriault pointed out that in the recently completed 2024 audit, one of the comments made by the auditors was the need for an additional person in the finance department. Cross training was occurring in the department and there were concerns that if this position were not funded, it could lead to delays in the audit schedule. It could also delay the implementation of the Tyler software modules, including report writing software that could help eliminate time needed to complete financial reports.
“If we’re paying all this money across the board in every department for this computer and software, and it is a lot across the board, it’s a tremendous amount of money going out, but everyone is asking for additional people, because there is additional paperwork,” Councilwoman Madula Kalesis said. “There’s additional work to do, filing and numbers and everything else, but we are paying an outrageous amount of money for this new software that can help us do that. So, we have to hire someone else that will cost $137,000.”
Vitola stated that he could answer that question from a finance perspective, but not for other departments.
“The software I’m referring to is more the general ledger and accounting software that was implemented, I think we went live in 2024,” Vitola said. “It is a software package with many modules. We’re using the essential ones which is to monitor the general ledger. We’re using the accounts payable module, which is great. It provides great controls, and from an audit standpoint, it’s better because you can see all the approvals. What we need to do is finish the implementation. We are currently paying for those modules and they haven’t been implemented. I want to get them implemented in the next year. That’s why it is essential we have another person in finance to help us get where we are using the complete implementation.”
Kalesis questioned why the city had been paying for modules they were not using for over two years. Vitola stated that some of those they were not using were cancelled to save funds and the department was able to find a few less costly options to avoid paying for modules through Tyler that they weren’t using.
“I hate a computer. I hate looking at this screen right now, it’s the worst thing for me,” Kalesis said. “I hate working on it. I don’t understand it. I have to Google every little detail in order for me to figure out how to use something. So, I totally understand you not using everything that you have on your platform. But again, the citizens are paying for things you are not using and when you are asking us for another person that is going to cost the city another $137,000, that is a lot of money.”
Vitola provided a more detailed explanation for why this position was necessary.
“The software has to be implemented and there’s a huge lift from staff as we implement module after module,” Vitola said. “But there will be a point where the software does provide efficiencies, and the implementation will be complete and there will be time savings. In the case of finance, not enough to eliminate a full-time position and we do have dollars budgeted as part of the project for implementation costs.”
Vitola did not want to tie the position directly to implementation as there were other things the department needed from an additional staff member. The position could assist with cross training, accounts payable support and payroll. The city had a contract with a company for reconciliation, but they were no longer performing that function.
“I also don’t want to tie this position to a contracted position or temp work as we have tried that, so I want you to think of this position as separate from that,” Vitola said. “But at this point, the loss of our payroll clerk in 2021 is what really started our snowball downhill with being behind. And then we had AP coverage we needed and while we have grown from four to five, we have not caught up with the pace of the department.”
Gaboriault added that this position would make the finance department more proactive rather than reactive. The department hoped to begin creating budgets out 10 years rather than waiting for council to request the budget. The new position would make the department more efficient.
“From what I remember from the audit, there are many accounts that need to be reconciled on a monthly basis, including monthly close,” Councilman Jason James said. “Those are things that need to be happening. A far as a five-to-ten-year forecast, that has been a desire for some time because it gives not just council better decision making when it comes to future taxes, future growth fees and all the like, but it gives better information to the department heads so they can better run their departments.”
James commended Kalesis for pointing out that computers and software could be difficult to understand.
“When council seeks improvements in our IT abilities, our software, which was horrible, ancient and horrible, one of the things we looked at was not the hard return on the investment, but a payback period,” James said. “I think it is taking longer than anyone anticipated and that happens, but looking forward, when the modules are up and running, when will we start to reap the benefits, because we need to know that it was a big nut, a big dollar. We also don’t need to add another person every time we have 200 to 300 houses come on, so those are the efficiencies I need to know.”
Vitola explained that he did not have a crystal ball, but without the additional staff member, there would be delays in bringing all the modules online.
“I am very pleased you guys are focused on cross-training,” Councilwoman Katrina Wilson said. “It’s always a big important piece to a good running office. To me, you have to be cross-trained. I know how critical it was when accounts payable was down and what that did to our city and everyone felt the brunt of that.”
Coleman explained to council that when significant software changes occurred like those currently being implemented in finance, there was often a need to increase staff.
“You are operating in what is known as parallel systems, so you have team members working in two different software systems for a period of time,” Coleman said. “While they are working in one system, they are training on the other while still dealing with day-to-day operations. It is a big lift, but they are doing an amazing job. It is also important to understand that the finance department must adhere to state and federal laws which software must have loaded. We are going through an assessment process now and customer service has had to use two different software programs for each transaction.”
Councilwoman Nadia Zychal thanked James for his insight.
“I do want to thank the finance department for handling this massive load,” Zychal said. “I appreciate that with the addition of a new system, we are also dealing with growth on top of that, and I would hate for both the workload on both ends, from implementation and actual city needs to snowball, because I can see how, once you start getting behind, that could happen really fast, particularly with a quick pace of growth. So we just need to be cognizant of that when we’re dealing with appropriation.”
Councilman Danny Perez asked how many full-time staff were in finance currently and Vitola responded there were five. Perez then asked how many part-time staff and was told none. There was a temp position paid through an agency, but that was not a full-time permanent position.
“I can say that is remarkable,” Perez said. “I know how this works in the private sector with federal and state, so it is remarkable. I have been dealing with budgets, obviously not one as large as this, but with individual clients that have budgets around $14 million, $20 million and it takes a staff of at least 10 people to manage their finance department. So, I take my hat off to you.”
Councilman Dan Marabello also commended the department on achieving what they did with a small staff.
“I concur with what Danny said,” Marabello said. “It’s remarkable. But I like what you are saying. You used two key words for me – proactive versus reactive. Being reactive, you create an unbelievable amount of stress on your people. Also, cross-training as Katrina said, you need more people. And also, internal control was one of the notes in the report.”
Zychal also pointed out that timely reports were critical.
“Timely reports are something that are a twofold benefit for the city,” Zychal said. “It is transparency for the people to make sure that all those dollars are being used to their benefit, and it is transparent because it creates more information for council to make more informed decisions and to keep that going and flowing and proactive could benefit everybody.”
Kalesis commended the work that the finance department did, but questioned the number of staff in the department, pointing out with the temp, there were six positions, not five. Vitola explained that if they hired the full-time position, they would no longer need the temp. Coleman also explained that the temp was not being paid directly, but the agency they worked for received the funds.
During the presentation of the Customer Service budget, Vitola also requested an additional position who would act as a Senior Cash Operator to assist with a growing need in the Customer Service Office.
Council will vote on the budget at a future meeting. The entire budget can be found online.
