FROM THE TOWN ADMINISTRATOR’S DESK
By Gregory T. Federspiel
The countdown continues to the Fall Special Town Meeting scheduled for October 15 at 7PM in the gymnasium of the Memorial Elementary School. The warrant (notice) for the meeting contains three articles (proposals) for voters to consider.
Article 1 seeks voter approval to reduce the membership of the Finance Committee from 9 to 7. Both the Selectmen and the Finance Committee favor this change. 7 is a more typical size which makes it a bit easier to find willing volunteers and muster a quorum for meetings,
Article 2 asks voters to amend the snow parking ban bylaw by clarifying that any tickets issued to violators will be handled per the state law that allows us to manage the tickets internally without resorting to the courts – a more streamlined process.
Article 3 seeks voter approval for the funding of a new elementary school subject to final approval by ballot at the November 6 elections as a debt exclusion. Last week I discussed various options for how we might pay for the new debt – new debt exclusion, use of our local receipts, redirected operating funds, and new tax revenue from residential or commercial growth. The other question frequently asked is how would a new school project impact other town capital needs.
Our capital funding strategy for non-school needs going forward is based on utilizing general fund dollars and dollars raised through debt or capital exclusions (an exclusion is taxation above the limits of Proposition 2 ½ for a specific project.) Importantly, going forward we envision capping the amount of excluded dollars to be no higher than what we currently collect (as has been the case for the past 3 years.) This means we do not anticipate the need to raise taxes beyond the confines of Proposition 2 ½ for non-school capital needs.
This is an important change from what has happened in the past. Town tax exclusions for non-school needs stands at $1.9 million. As debt is retired we replace the dollars formally needed to pay down our debt with cash for new capital projects. Within four years this will allow us to earmark $1 million annually in capital exclusions plus $2 million in general and enterprise funds for a host of capital projects (town vehicles, town roads, water and sewer pipes, town facilities, etc.) Over a 15 year period this means some $45 million worth of infrastructure and other capital improvements – a healthy sum which will allow us to catch up on a backlog of needs.
By the early 2030’s we will have retired the rest of our current town debt as well as the high school debt. In addition, our pension and OPEB (retiree health insurance) liabilities should be fully funded. This will free up a significant amount of funds that can be used for large capital needs, again without the need for increasing taxes (seawall work, upgrades to water and sewer plants, upgrades or replacement of the Essex Elementary School.)
Surprises will undoubtedly arise and changes to the game plan likely will occur but I believe the approach discussed above lays out a viable strategy for paying for a long list of capital needs the community faces without raising taxes beyond what will be needed to fund the new Memorial School project.
And work continues on strengthening our fiscal policies including keeping operating budgets within the funding limits of Proposition 2 ½, maintaining stabilization and fund balance accounts at roughly 10% of total expenses, keeping debt to no more than 10% of total expenditures and fully funding our retiree liabilities within the next 15 years. These fiscal policies combined with our new approach to capital projects should provide a more stable approach to town tax burdens then we have seen over the past 15 years.