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Generally speaking, if you have to borrow money in a new year to pay off a prior year loan, you are probably running a deficit that should be covered by raising taxes at your annual meeting.  A tax anticipation note is to cover cash flow needs until your tax proceeds pay off the loan.  It sounds like you don't have enough cash to meet your operating expenses; either your budgeted revenue isn't covering your expenses, or you have expenses over what was budgeted.  In either case, you are probably running a deficit that you'll need to voters to raise taxes to cover.
-----Original Message-----
From: Sherrill Gould [mailto:[log in to unmask]]
Sent: Wednesday, April 07, 2004 2:24 PM
To: [log in to unmask]

Hope someone out there can provide some input.


Windsor currently borrows in anticipation of taxes on July 1 of each fiscal year, with payment due on June 30.  Unfortunately, the town usually has a negative cash flow on June 30 so we use the proceeds of the next loan to pay off the current one.  How do other towns handle this?  Are there other options for handling cash flow shortages during the year?


Your input will be greatly appreciated as this issue is being blown out of proportion, as do so many issues in small town government.


Sherrill - Town Treasurer