Democrat David Gioiello says he will create a separate reserve account in the city budget as a way to clearly designate surplus funds. Under Republican Mayor Mark Lauretti\u2019s administration, the reserve fund now is drawn from unspent line items in all department accounts, according to Gioiello. This approach \u201cmixes [the reserve] in with the operating budget, which really clouds the issue,\u201d said Gioiello, who is running for mayor against Lauretti. He said his approach would \u201ctake this out of the shadows\u201d and lead to more transparent budgeting that would \u201ctruly reflect what it takes to run the departments.\u201d Gioiello was joined at a recent press conference in front of City Hall by fellow Democrats Wayne Bragg, a member of the city Board of Apportionment and Taxation (A&T), and former Mayor Michael Pacowta. Budget for what will be spent Bragg, who worked as comptroller of Sikorsky Aircraft, said department expenses now are overstated in the city budget to create the reserve. He said while this is one way to handle budgeting, having a separate reserve fund \u201cwould provide more visibility to the reserve and hold the departments accountable to budgets that are aligned with their actual work requirements.\u201d Bragg said the approved budget should reflect what will actually be spent, but the current administration\u2019s mentality is that \u201c[department] budgets seem to represent what we\u2019d like to have, and not what we will actually spend.\u201d City positions go unfilled Gioiello and Bragg said many of the excess funds now are found by not filling municipal positions included in the budget. \u201cYou have these open positions,\u201d said Gioiello, pointing to those of assistant library director and \u2014 more recently \u2014 Huntington Library Branch director as two examples. \u201cWe\u2019ve inflated the numbers,\u201d Bragg said of budgeted personnel. Bragg said two prior Republican A&T chairmen have recommended the city set up a formal reserve account, \u201cso this is not something we\u2019re just discovering now.\u201d Pacowta, a CPA who now serves on the Board of Education, said having a separate reserve would \u201ctake away any suspicion of over-taxation\u201d by clearly defining what money is being set aside. Rating companies eye reserve funds Municipalities generally try to have a reserve account \u2014 also called a fund balance \u2014 of at least 5% of the operating budget. This is what credit rating agencies want, and it can help a municipality get a better credit rating and therefore lower borrowing costs. Shelton usually has surpluses in this range. A reserve or fund balance is basically the accumulation of past budget surpluses. For an individual, it\u2019s like having a savings account for an emergency or future major purchase. Lauretti counters Lauretti dismissed Gioiello\u2019s criticism and his proposed new approach. \u201cWe have both,\u201d said Lauretti, indicating that the budget as currently put together can accommodate operating expenses and reserve funding. Lauretti said Gioiello\u2019s comments \u201cdemonstrate his lack of understanding in running a city,\u201d and it\u2019s not his role as the incumbent to help his political opponent better comprehend the Shelton budget process. \u201cI\u2019m not going to educate the guy,\u201d Lauretti said. Gioiello also said the city is bonding too much these days, pushing the cost into future years. Having a designated reserve would allow these funds to be used to pay for expenses now being bonded, accoring to Gioiello.