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Bow selectmen adopt 8%–14% fund‑balance policy to guide reserves
Summary
The Bow selectmen voted to adopt a formal fund‑balance policy setting a target range of 8%–14% of the combined budget base, providing guidance for tax stabilization, capital planning and emergency use. The policy passed after extended discussion about appropriate minimums.
Bow Town — The Board of Selectmen voted Sept. 23 to adopt a formal fund‑balance policy that sets an unassigned fund‑balance target range of 8% to 14% of the town’s combined tax base for town, school and county obligations.
Finance staff presented year‑end figures and a range of options and recommended a policy that establishes a minimum and a target to support tax‑rate stability and unexpected liabilities. “I would recommend 10% — 5 to 10% is conservative — but a range gives us flexibility,” a finance presenter said during the discussion.
Selectmen debated several options before making a motion to adopt a range of 8% to 14%. The board voted in favor and the motion carried.
Why it matters: The policy creates a clearer rule for budgeting and helps preserve funds for emergencies, tax‑rate stabilization and planned capital needs. Finance staff noted that 10% would equate to roughly $4 million based on the town’s most recent assessment figures and that the policy can be revisited as circumstances change.
What’s next: Selectmen and staff said they will use the policy as a guideline for the coming budget cycle and may designate portions of fund balance for specific liabilities (for example, overlay for tax cases) or capital seed money if revenues permit.
At the meeting, officials framed the decision as a tool to avoid year‑to‑year tax volatility and to prepare for large, foreseeable liabilities while retaining the ability to adjust the range in future years.
