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March 4, 2008
The proposed budget for the next fiscal year – FY2009 – has been presented to the Board of Selectmen. Now the Selectmen and I are inviting residents to review and comment on it to ensure that your priorities are appropriately addressed and that your questions are answered before the Selectmen add their final recommendations to the proposal.
A Town budget is a bulky document, a sea of line items and numbers. I’d like to highlight some of the basic thinking and history that underlies the budget, some of the important recommendations it includes, and where we see the Town’s budget going in the future.
The budget proposal prepared by my office was developed with the goals and priorities of the Board of Selectmen in mind. First and foremost are the commitments made to residents as part of the Proposition 2 1/2 override in 2005, spelled out in the 5-Year Plan established at that time:
1. Override funds will be made to last at least 5 years (through the FY2010 budget). No general override will be sought during this period.
2. Healthcare and pension costs will be limited to increases of no more than 7% and 4% respectively.
3. Town and School operating budgets will be limited to increases of no more than 4%. Should healthcare costs exceed the 7% cap, operating budgets shall be reduced below 4% to make up the difference.
4. We will maintain cash reserves of at least 5% of the budget.
FY2009 is the fourth year of the 5-Year Plan. The proposed budget for this year is in balance and allows $592,039 to go into the override stabilization fund. The projection for FY2010 includes a planned withdrawal from the fund in order to be balanced in accordance with the 5-Year plan. In fact, we have been able to extend the utilization of the fund into FY2011.
The plan is working. However, it is not without strain. The basic reason is that, despite some very creative efforts to reduce expenses, some of them – healthcare in particular – keep going up, while our tax base doesn’t. Healthcare costs are projected to increase 12.5%, exceeding the 7% cap and thus requiring that departmental operating budgets be limited to a 2.81% increase in order to comply with the 5-Year Plan.
The budget, as proposed, continues to maintain current service levels with public safety and education being top priorities. Each of these priorities was provided with extra funding as a result of a reallocation of funds within the municipal budgets. An additional police officer position has been added to assist with criminal investigations and overtime funds have been increased to provide additional traffic enforcement. Additional overtime funds have also been allocated to the fire department to help maintain existing staffing levels. Approximately $70,000 has been reallocated from the municipal departments to the school budget to allow for a 3% increase in the school budget thereby reducing the municipal departmental budget increase to 2.74%.
The Town’s capital improvement program policies call for 5% of the Town’s revenues to be allocated for capital projects and equipment. Capital improvements proposed for FY2009 include;
· vehicle and equipment upgrades for public safety and public works
· park renovations for the Summer Street Playground and Thorndike Field parking expansion
· building improvements for Public Works Garage and Gibbs School
· repairs to roads, sidewalks, and culverts.
The Capital plan also provides funds for ongoing repairs to the Thompson and Stratton Schools while awaiting clarification from the state on future funding for the renovation or rebuilding of these schools. Additionally, I will be working with the Park and Recreation Commission, Recreation Director, the State, and private groups to develop a plan to renovate the Veterans’ Memorial Skating Rink as a sustainable operation at little or no cost to the Town.
Every effort has been made to implement all appropriate measures that maximize the productivity of our organization and deliver the highest quality of services within the available resources. Our entire management team has worked together to identify and implement creative ways of doing more with less. Since 2003, Arlington has had a 12% reduction in its municipal workforce, most of the reductions coming through attrition. Yet service levels have not diminished.
The plan to contract out cemetery maintenance will provide immediate cost savings, freeing up resources to be allocated to other areas such as public safety and education. Regional cooperation will allow us to exploit economies of scale for large purchases such as salt, sand, and for contract services such as road paving. The Town also entered into long-term energy contracts to control energy costs. We are also looking into joining the State’s healthcare program (GIC) to better contain rising healthcare costs.
We do work hard on keeping expenses low and we’ve been effective. Analysis from the Massachusetts Department of Revenue Municipal Databank summarizes that, per capita, Arlington’s spending is nearly 20% below the state-wide average (state avg. $2,556 vs Arlington $2,181 in FY2006). But continually rising costs for healthcare, energy, and operations make it critical that we keep a lid on expenses to maintain our commitment to the 5-Year Plan.
We know we need to keep working aggressively on expenses because Arlington’s ability to raise revenue is very limited. The commercial/industrial sector accounts for 5.4% of the tax base, a far lower percentage than most comparable towns and the state average. Of 20 comparable communities the average is 13.3%. The state average is 15.5%. That places the tax burden primarily with the residential sector. State aid to Arlington was cut close to 20% in 2002 and is still 3% less than 2002 levels, while aid to other municipalities has rebounded an average 20% above the FY2002 level. The distribution formula used by the state works to the disadvantage of communities of relatively high incomes and property values, which Arlington is considered.
These are just a few of the highlights of the FY2009 budget proposal. I will be giving a more in-depth presentation of the proposal at the next Board of Selectmen’s meeting, March 10 at 7:45 p.m. at Town Hall. The meeting is open to the public and I invite you to attend. If you can’t make that meeting, please review the budget presentation and the FY2009 budget proposal online at arlingtonma.gov. The Board of Selectmen are asking residents to comment on the proposal to ensure resident priorities are adequately addressed before the Board makes its final recommendations on the proposal. You can comment at the meeting or via email at selectmen@town.arlington.ma.us by March 17, 2008.
We remain committed to maintaining the high quality of life our residents expect and deserve, but I wanted to let you know about the challenges we face, the actions taken, and plans made to address them. As we navigate the future of Arlington, we will continue to communicate important activities like these to foster open and better government for all residents. – Brian Sullivan, Town Manager, Arlington, MA
Town Manager Brian Sullivan presents the FY2009 budget proposal at the Selectmen's Budget Hearing, March 10 at 7:45 p.m. Attend the meeting Selectmen's Meeting Room, 2nd Floor Town Hall, watch it live on local cable or review the budget presentation and FY2009 Financial Plan online here.
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