Smith presents Sutton Preliminary Budget for Fiscal Year 2013
$85,000 budget gap still needs to be closed by the end of March
BY TOM REILLY
Sutton Town Administrator Jim Smith noted that many of the figures in his presentation were preliminary and could change over the early part of the budget. The current total town budget for Fiscal Year 2013 was $26, 797,005, which represented an increase of $755,000 or 2.9 percent over FY2012’s final budget.
Smith said there was still a budget gap of $85,000 yet to close. He said his goal was to maintain existing services while absorbing more cuts in local aid and increases in the cost of benefits.
The town administrator said that out of the $755,000 budget increase, $350,000 comes from the tax levy related to the debt exclusion for the school project. Smith said there would be a couple of years of debt to absorb at this level before the amount begins to go down for the remaining 17 years of the project.
Of the remaining $400,000, $200,000 is due to employee benefit increases and $300,000 goes to departmental changes or 1.7 percent. Smith said this leaves a budget gap of $85,000.
Smith said the town intends to continue to reduce its dependency on one time revenue sources while absorbing increases in benefits and unemployment. He noted that there would be layoffs in the school department and stated that he would most likely fund the budget gap on the town side by making further reductions in departments.
The town administrator said the state has cut Sutton’s lottery aid again, this time by 7.2 percent for a total of a 37 percent decrease in lottery funding since 2009. He noted that this is $47,000 less than the town received in October, though, he noted that Governor Deval Patrick hopes to restore funding to last year’s levels with a supple- mental distribution.
He added that Chapter 70—the money that is earmarked for schools— is level funded and down 7.3 percent since FY2009. He noted that other than local property taxes, which are up 6.26 percent, every other revenue source is down from the previous fiscal year. He said that the numbers from the state has largely gone down and that the school in particular could not live on level funding.
Smith said that the town got more money in 2007 than it did today. Going to FY2008, 26 percent of Sutton’s revenues came from local aid compared with 21 percent today. This meant an increasing reliance on property taxes, something that Smith said was a negative for Sutton.
Smith said new growth typically came in at around $185,000 and that the assessors have said the amount would be roughly $100,000 in FY2013. He said that he was not inclined to go against the assessors, but he hoped that when that the figure might be higher when it was permanently set in August.
Local receipts were up because of number of things the town has been doing, said Smith. The town has traded the SREQs from its solar energy project on the open market and realized an additional $110,000. Other local revenue sources included the lease of the former Manchaug Library ($12,000) and the cell towers ($30,000-$50,000).
Smith said the town was trying to focus more on local revenues in order to increase money coming in.
Another successful initiative from the past year was the health department regionalization program run by public health director Cheryl Rawinski ($10,000). Next year he hopes to see revenue from the hydropower study at the Manchaug dam and the installation of solar panels on the roof of the Manchaug fire station.
The town administrator then took a look at proposed expenditures for the coming year. General government was up 11 percent, driven by things like the town side taking on half of the cost of the data processing position that it split with the school department, the valuation audit, an additional election and the rising cost of gasoline.
Public safety was up 4.6 percent and public works, a department that Smith said has been cut in recent years, was up 6.6 percent.
The town’s health care costs were up again, but only $55,000, much less than last year.
Pension costs were up $29,000, a 4 percent increase, and unemployment remained at $140,000, most of that to cover the cut in positions at the school department.
The school department’s share of unemployment came to $120,000 while the money to fund its capital plan to pay for technology and other items amounted to $152,500. Smith noted that the school department will lay off about seven people, most likely three at the elementary school and four at the high school. He also noted that the high school will be implementing block scheduling—a system where students have fewer classes per day but generally for double the time. He noted later in the meeting that the teachers union might grieve this issue, though this was still an issue in progress.
Smith said there were still unknowns to deal with. The economy seemed to be improving, so it was possible that the final state budget might contain more money. It was also possible that there could be more cuts in local aid. It simply wasn’t impossible to know yet. The cost of health care and Blackstone Valley Tech were still only estimates as yet, but both would be up. The sewer fund would be level funded and the transfer station had no increases planned for the sixth straight year, though Smith said that it might be time to start setting money aside for future equipment replacement.
Smith said he thought the town was in a better position this year than it has been in recent years because the cost of its health insurance was up by a relatively small amount this year. He thought that town accountant Tim Harrison and building commissioner John Couture had done a good job of keeping costs down and allocating the money the town had in the right places.
Mike Chizy praised the efforts of the town’s finance team, stating that he believed that Sutton was in better shape financially than other towns in the Commonwealth, a sentiment that John Hebert echoed.
Rick Hersom asked when the state would be releasing more solid numbers and Smith said that he expected to have the House budget sometime in April. He asked Smith if his $85,000 deficit included a likely $60,000 or more increase for Blackstone Valley Tech. Smith said he had funded it part and that the final deficit could go as high as $110,000, but it was still too early to say.
Ken Stuart said he applauded that Smith was not dipping into its stabilization fund to balance the budget. He called cutting the teaching positions “a necessary evil” in the current economic times and blamed the state for its lack of financial support.
Smith said that the budget would be balanced by March, something that he had no choice in doing.
Chizy said the state started the state lottery for one purpose—to help the cities and towns. Since then, the state has cut this aid over and over until the town is now receiving $350,000 less in lottery money than it should.