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Posted on March 21, 2018 at 10:24 AM by Elizabeth Dukes
FROM THE TOWN ADMINISTRATOR’S DESK
By Gregory T Federspiel
At the April 2 Annual Town Meeting voters will be asked to approve the operating and capital budgets for the Town. Article 4 presents the operating expenses for each Town department while Article 5 and 6 present the various capital purchases and projects.
The proposed FY19 operating budget for the Town is up 2.8% compared to this year. This increase in operating expenses is a bit higher than in recent years. This is partly driven by new expenses, including new benefits for qualifying veterans (we eventually get reimbursed for 75% of these expenses) and a few staffing increases (proposed new seasonal deputy harbormaster paid for through waterway fees and a new “floater” fire fighter to fill in for leave time of other fire fighters necessitated by a large decrease in the number of call fire fighters.) With a fall state primary and general election, expenses to cover the cost of elections is up. For all the details on the proposed budget go to the Town’s web site where the full budget can be reviewed.
The proposed capital budget continues the more aggressive efforts we started a few years back to begin catching up on years of deferred maintenance. While the total is slightly less than last year, voters are still being asked to spend a healthy $2.2 million on capital expenditures all from funds in hand or to be collected through taxes – not through borrowing. The list of items in Article 5 includes replacing various DPW vehicles that are worn out, road paving (Lincoln Street and possible Pleasant), drainage work and matching funds for Complete street projects; a master plan for athletic fields, resurfacing tennis courts and a new teen space at the library. Public safety projects include upgrades to the radio system serving Fire, Police and DPW, setting funds aside for a future fire truck purchase, and a replacement cruiser for the Police. Water and sewer plant equipment upgrades are also part of the capital plan as is starting on the permitting process for a second round of harbor dredging.
Article 6 seeks voter approval of $400,000 to go towards the reconstruction of the dam and culvert on Central Street next to Seaside 1. We recently received a grant from the state’s small bridge program for $500,000 (they deemed the structure the worst in the county) and we will seek additional grants in order to complete this major project estimated to cost some $1.5 million. The proposed $400,000 would be raised through a capital exclusion which requires a positive vote at the ballot in addition to a majority vote at Town Meeting. Our debt payments for next year will be approximately $400,000 less thus, while approving this new capital exclusion prevents taxes from being reduced, it will not cause a tax increase.
As we look ahead regarding our capital needs for the Town, we have an opportunity to proceed on a “pay as we go” basis instead of relying on borrowings like we have over the past 20 years. We can do this by replacing old debt exclusion funds as we retire debt with new capital exclusion funds. Doing so allows us to put more funds directly to work by avoiding the interest payments on borrowed funds. As noted, this means taxes raised temporarily for debt payments do not go back down but by keeping the total of excluded dollars constant, we prevent taxes from growing the way they did in the past. This strategy will work for the majority of the Town’s capital needs. However, it does not work for the School District’s building needs given that the debt on the middle high school will not be retired for another 15 years and the desire for renovating or replacing the elementary school is now. Other strategies will need to be explored to help soften the tax implications of new school building projects – more on this another time.