Sutton BOS discusses slimmer FY2011 budget
BY TOM REILLY
Town Administrator Jim Smith last week presented selectmen a Fiscal Year 2011 preliminary budget of $25,921,287, approximately $10,000 less than the budget for the current fiscal year.
Smith said his numbers are based on the governor’s budget, which cuts the town’s state aid by $70,000 while level-funding lottery aid and Chapter 70 money for schools. He added that revenues had been slightly down from the year before. He said there remains a $124,000 gap that needs to be closed. Smith said he hopes to reduce the deficit before May town meeting.
Smith called the budget “a work in progress.” He said that while February is relatively early in the process with “moving pieces” still in the budget, “there are not a lot of unknowns” other than the final state aid figures. Smith said a lot of the larger numbers — benefits, health care, Blackstone Regional School — are all “fairly close to being locked down. He told the selectmen that the only revenue increase in the budget was $418,000 from a Proposition 2 ½ increase plus the new growth in the local property tax, which Smith estimated at $75,000.
He noted it is the lowest amount of new growth in his three years on the job because of the lack of construction. The increases in new revenues doesn’t even cover two of the town’s cost increases — $175,000 for the Blackstone Valley Regional School plus $271,000 in employee benefit cost increases, Smith said.
Smith said property values had stayed essentially stable, meaning no real increase in property taxes; local receipts are essentially level. He added that he had budgeted free cash for the coming fiscal year at $475,000, down 9 percent from the current year. Smith said he is trying to “smartly” wean the town off free cash.
While revenues have been down, Smith believes the town has effectively weathered the economic downturn by reducing departmental expenses, using one-time revenues in a prudent manner and not filling vacant positions. Smith said that as the town begins to emerge from the recession, Sutton would be able to restore some of the essential positions and expenses on both the town side and the school side.
Smith noted the state has drastically decreased non-school state aid over the last year. In fact, the state is currently sending Sutton $90,000 less than it did in 2002. He said this makes it very difficult for the town to fund even the smallest increases because there is no telling in any given year whether or not the state will provide even the same level of funding than it did the previous year. Sutton’s overall state aid has been decreased by half a million dollars over the last three years at a time when nearly every type of cost has increased, he said.
Smith then ran through the expenditures of each department for the next fiscal year. Local education is up 1 percent with most of the increase going to Blackstone Valley Tech whose funding has increased by 15 percent this year, a total of $350,000 over the last two years. The Sutton public schools are level funded, something that Smith said would be a challenge for them, especially after asking for an increase of a little over $800,000.
Fire and ambulance funding rose almost 5 percent (but only $16,000) and benefits increased by 9 percent. But nearly everything else is down — debt service (-10 percent, with almost $600,000 due to drop off the books over the next two years), police (nearly -3 percent, mostly due to a freeze on an open position), and all other expenses (-5.4 percent). The money needed to run the town, not including education money or benefits, rose 1.2 percent or $51,000. Smith said that this number might even be less as he is talking with union and non-union personnel alike in an effort to find a way to reduce costs.
He said he could not ask department heads to seek no raise for the second straight year, but he was asking for their help. He stated that in addition to the frozen police sergeant position, vacancies still remain in the Highway Department, Council on Aging, and the Planning Department. Smith has also pursued energy savings including moving forward on the installation of solar panels at the Early Learning Center. Smith said that he has also been meeting with other communities regarding the possible regionalization of health services and 911.
Smith next talked about possible ways that might help reduce the remaining $124,000 budget gap and raise some additional local revenue. He recommended the selectmen and the town meeting vote to adopt the local option meals and hotel/motel tax in the spring. About 70 communities have adopted thel tax increases over the past year with a number of additional communities considering it during this budget season. Local communities such as Auburn, Webster, Worcester, and Shrewsbury have all approved the measure. The state Department of Revenue estimates that Sutton could realize an additional $45,000 in revenue by raising the meals tax by three quarters of 1 percent, or 75 cents on a $100 meal bill, and an additional 2 percent on the hotel/motel tax.
Smith then talked about the town’s two enterprise funds, which are independent of the general fund appropriation process. The transfer station and the sewer department are both responsible for raising enough revenue through their operations to support the expenses of their respective departments. He told the selectmen that the sewer budget as presented represents an increase of 1 percent over FY2010 and that this increase was due solely to contractual increases.
Even under difficult economic conditions, the transfer station came within $350 of breaking even for the year. Smith credited Mark Brigham and Erik Bentley for their hard work and creativity. He noted that with the addition of a trash compactors and consistent operations and better enforcement expenses have decreased while the recycling rate for users of the transfer station approach 50 percent. Smith said he is proud there will be no increase in the price of stickers and bag fees for the fourth consecutive year.T
he capital plan for the coming fiscal year is funded at $373,000. Smith said the school department, as the largest department in the town, would receive $159,500 of the allocated capital funds. The remaining funds are allocated among the Police Department ($44,500), Fire Department ($19,000), Council on Aging ($43,000), Marion’s Camp property rehab ($50,000), Town Hall improvements ($22,500) and a Town Master Plan ($30,000).
The town administrator said that the FY2011 capital plan would help the town complete a major phase of the redevelopment of Marion’s Camp. Smith said that using this year’s capital appropriation and existing state grant funds, the town plans to construct the parking lot, the access road/ handicap access to the beach and address the drainage issues that cause annual beach erosion into Lake Singletary.
The vote to fund the construction of a new middle/high school is crucial, he noted. If the Massachusetts State Building Authority approves the project and funding at its March meeting, said Smith, then it will be on the warrant for the May town meeting for approval. If the MSBA does not approve the project until May, then the town will continue the town meeting until June and approve the project then. The preliminary cost of the project is in the $60 million range with the town’s share about $30 million. If approved at town meeting by a two-thirds vote, then it will be put before the the town for a debt exclusion vote.
Smith said the town has addressed the economic downturn by trying to identify ways to generate income beyond the property tax and state aid. He pointed out that the town is leasing the vacant Manchaug Library to the Puckihuddle Preschool, generating $10,000 per year for the town. The town is also in planning stage of installing cell towers at Town Farm Road and Shaw Farm to address the lack of cell coverage in West Sutton, as well as to generate additional revenue.
Selectman Kevin Geraghty said Smith had presented a financial picture “that was not as bad as I thought it might be.” Selectman Hersom warned that because of unfunded mandates and increased taxes the town lacks the flexibility to truly cut where it needs to.