FAIRFIELD — Adopting a budget that expected less than the state was supposed to give has left the town in better shape than most municipalities to deal with cuts in state revenue, though officials worry more cuts are still to come.

The town’s approved budget anticipated $5.32 million in all state revenue and the budget adopted by the state provided $5.33 million. What has actually been allocated to this point by the state, however, is just $4.44 million, a gap of $890,000.

But a mix of favorable local revenues, and a hold on some expenses has left the town with about $1.1 million to play with should more state cuts come down the pike, officials said. Last year, the state made another $500,000 cut to Fairfield’s state revenue, and officials are prepared for similar action this year.

One of the biggest hits to the town between what was adopted by the state, and what was actually allocated by the state, was a cut of $448,006 to the college payment in lieu of taxes. The state also pushed half the cost of a $100,000 renters reimbursement program onto the town.

According to Tetreau, the state Senate voted to authorize the funds to be spent, but require towns to pay half the cost. “In Fairfield’s case, we budgeted $100,000 in revenue reimbursements from the state for this program,” Tetreau said, in his most recent budget update. “We now have to find $50,000 in adjustments to pay for half this program. This amounts to an unfunded mandate.”

An elderly and disabled homeowners tax credit program was not funded in the state budget at all, but the town had already applied those tax credits to qualified residents’ property tax bills. “There doesn’t appear to be a solution coming from the state,” according to Tetreau, creating a $414,000 hole in the town budget, and making it another unfunded state mandate.

Also weighing on the town’s finances, Tetreau said, is the anticipation that there may be more cuts in December, depending on the state’s revenue projections, and signals from the governor that it will be difficult to find budgeted savings. “This could signal even more cuts to our town funding come springtime,” he said.

For those reasons, Tetreau said he is taking a cautious approach, tightly managing costs, and keeping “numerous” capital projects on hold.

.The state’s future actions have the members of the Board of Finance casting a wary eye toward the balance sheet as well.

“A state budget weakness in revenue may give the governor the right to cut further,” Board of Finance Chairman Tom Flynn said, during a recent quarterly budget review.

If the state anticipates a one percent or greater budget shortfall, Fiscal Officer Robert Mayer said, the governor has the authority to make additional cuts.

“Let’s say that happens and we get hit again, where are we going to find those savings,” Flynn said.

Mayer said that’s where the $1.1 million comes in, but Flynn said much of that money is basically not doing any paving.

The town has done better in current and prior year tax levy collection, to the tune of $574,000, but is anticipating about a $75,000 drop in revenue from the Town Clerk’s office. There are better than expected revenue of $64,000 coming from Parks and Recreation, and another $56,000 from other permit fee revenues. Those figures, along with the latest $924,000 in lost revenue, leaves the town with a net loss in all revenue of $305,000.

On the expense side, the town has $417,000 in operational savings through vacancies, and $1 million in “hold” savings on paving, for a total of $1.4 million.

“The town will be continuing the strategic hiring freeze and will cautiously be releasing some capital projects,” Tetreau said. “We are still concerned about municipal aid cuts in December when the state gets updated revenue numbers for the current year.”