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Mar 22

From the Town Administrator's Desk-March 21, 2017

Posted on March 22, 2017 at 1:56 PM by Elizabeth Dukes

A large portion of the Annual Town Meeting is devoted to the approval of budgets.  As I often say, budgets are about choices – choices about service levels, choices about a community’s priorities, and choices about how much property tax voters are willing to pay. 

There are a number of different budget related articles that will be presented at the meeting scheduled for April 3.  If all of the spending articles are approved voters will be agreeing to increase total spending by 2.8%.  Different budgets are proposed to increase at different rates, from a low of 0.9% for the Town’s general operating expenses to a high of 3.7% for the School District’s appropriation.  Overall, budget requests allow for a continuation of existing services with no significant changes – a level services budget.

To pay for the increases, a 2.5% hike in the tax rate is proposed plus new taxes generated from new construction (new growth).  Most other revenue sources are conservatively estimated and are projected to remain flat with the exception of the increase in trash bag fees to help offset the higher collection costs we have.    

Article 4 on the warrant is the operating budget for the Town.  The proposal for the new Fiscal Year, which begins July 1, is increased by 0.9% over this year’s budget.  Driving the increase is a boost in salaries as we anticipate a new set of labor union contracts, an increase in the overtime account for the fire department to help make up for fewer call fire fighters, an increase in trash collection expense as we transition to a new vendor, added hours for the Town Planner paid for by the Affordable Housing Trust, added funds to provide Sunday hours at the Library (previously grant funded), and higher expenses for disposing the sewer plant’s sludge (paid for by sewer user fees.)  Off-setting some of these increases is a decrease in debt service (though if voters approve the capital exclusion vote  -- see below -- to fund converting streetlights to LEDs this will shrink this off-set.) 

Article 5 is the Town’s capital budget.  A detailed discussion of the proposed capital budget is in the Finance Committee report which residents will receive on Sunday.  The requests cover a wide range of equipment needs and projects. The requested total is increased by $250,000 over the current year but only because previously approved but unused capital dollars are being asked to be re-purposed for sidewalk and drainage imrpovements (funds to expand the DPW garage at the existing location are not being used as we are looking at other options.) 

Article 6 and 7 are also capital related.  Article 6 seeks voter approval for funds to purchase and convert the streetlights to LEDs.  We should be able to cut our annual bill for streetlights in half. Thus, the project pays for itself in about 5 years.  To fund this effort, capital expenditure exclusion votes are requested – one at Town Meeting and one at the Town Election – to allow the one time raising of the needed funds outside the limits of Proposition 2 ½ (similar to a debt exclusion.)  The proposed capital expenditure exclusion amount combined with the proposed debt exclusion total is projected to be level year to year at the current debt service amount.

Article 7 is a new bond vote.  We have retired previous debt and can now borrow new funds without increasing our annual debt service payments. The request is for a bond of $4.0 million using the funds to continue our need to reinvest in our water and sewer system which continues to be plagued by breaks.  Approval is needed at the Town Meeting and at the Town Election.

The School District’s request is for a 3.7% increase.  The District’s overall budget is proposed to grow by 3.2% but because Manchester’s share of the student body continues to increase relative to Essex’s share, we are being asked to approve an appropriation that is 3.7% higher than the current year amount.  

Other votes will be on the funding for the vocational school, for Community Preservation projects (listed in the Finance Committee Report), for the Town’s OPEB trust fund (retiree health insurance future liabilities), for the Town’s stabilization (rainy day) fund, and for electronic voting at town meetings in the new fiscal year. 

Read all the details in the Finance Committee’s report that will be delivered to you by the Scouts on Sunday and view the detailed budgets on line at the Town’s web site.  As always, feel free to contact me with questions as you prepare to make your choices at the Annual Town Meeting.