The following is part of a transcript from the Jan. 27, 2014 Chelmsford Board of Selectmen meeting. For the full meeting, click here.
The board then went to the Town Manager’s reports, beginning with a list of Town Meeting draft warrant articles and timelines for Town Meeting.
Hanson had a question on whether 7:30 p.m. would be a better start time than 7 p.m., with Cohen saying that the Selectmen placing the starting time of the first night of Town Meeting and Town Meeting putting the start time for subsequent nights.
It appears 7 p.m. may be too early for some Town Meeting Representatives getting out of work.
Cohen then gave an overview of his 118 page review of the Fiscal Year 2015 budget, calling it fiscally responsible and a level serviced budget.
He is legally required to submit the budget by this point due to its proximity to Town Meeting, but he noted there may be changes due to what he called a disappointing state budget proposal by Governor Patrick regarding local aid funding.
Cohen said that Speaker DeLeo told town managers across the state that House of Representatives would do better and that the final local aid figure would be ready in June. It is unlikely that there will be a local aid resolution to help towns with their budgets.
He continued the expected improvement of health insurance rates is at 5 percent, but could fluctuate from 8 percent to nothing and noted other items indicating that this was a “fluid” document.
There is an expected bottom line of $50 million for the School Department, $3 million for capital infrastructure investment and $1 million for Retiree Health Insurance Liabilities, and Other Post-Employment Benefits. (OPEB)
Askenburg requested elaboration on this, with Cohen saying that the budget is a two-part process with spring and fall Town Meeting, and that without a $1 million transfer from free cash, there would be an unbalanced budget, although this was still fluid due to revenue projections.
Lane asked if this was similar to the Sewer Stabilization Fund, with Cohen answering. Lane then asked if revenues did not meet projections and cash wasn’t transferred what the options would be, with Cohen saying there could be possible transfers or cuts. However, Cohen said that he was confident on the free cash projections being over $1 million due to the recent bond rating improvement, even with other unforeseen circumstances.
Askenburg asked if the $1 million was a request from the Finance Committee. She appreciated a hard number, but said that the amount made her nervous, although Dixon said that town accountants recommended the figure.
Cohen said that Town Meetings cannot hold future Town Meetings to any vote, but that the $1 million figure was what was recommended.
Cohen said he was comfortable with $1 million and Askenburg said she was not, and there was a discussion over who was accountable if things went wrong: the Board of Selectmen or the Town Manager (Cohen said he was responsible, Askenburg said she was responsible)
Hanson said that a Department of Public Works project was funded in a similar way.
Lane asked why the Finance Committee wanted to have it as a line item.
Sheila Pichette of the Finance Committee said that the Committee was generally uncomfortable trying to find $1 million every year and that that OPEB had to be paid as time went forward and that Sousa told the Finance Committee that it looked favorable that money would be available.
She continued that the Finance Committee did not want to use one-time monies for things like OPEB. Lane asked if the Finance Committee would recommend this as a reoccurring line item, and Pichette said it was likely that’s where they were heading.
While there was no vote on this according to Pichette, this was the consensus of the Finance Committee.
The budget in total is projected at $115 million, a $2.71 increase. Cohen said that the town will have to pay more for Nashoba Tech tuition and Middlesex Retirement funding.
Cohen said that the net school spending is actually going down due to lower enrollment, and provided more information on the school budget, which does not include benefits for employees and off-budget line items such as grants and circuit breaker funding, which puts the School Department budget at $60 million.
Cohen said that the town has more retirees than employees.
Askenburg asked about savings on the amount on the energy contract, which she expected at approximately $730,000. Cohen said that amount was what he recommended the School Department reduce their energy costs, and that the realized costs would likely be higher.
Askenburg was concerned about step increases, with Cohen saying that could be addressed by savings from the energy savings and that the School Department would get a baseline of approximately a $1.5 million increase in the budget, but that the School Department does not pay for debt service, with confusion on that front.
Lane asked about leasing for the new turf fields, which Cohen said was low, but that there was time and there were two large contracts pending.
Cohen continued on school district numbers compared to nearby and comparable school districts, as well as information on the Nashoba Tech School District which he saw as favorable.
Cohen said that the Police Department has approximately 33,000 calls per year with approximately 70 dispatchers and officers and approximately 6,000 calls for the Fire Department, which has just over 60 firefighters and staff.
Cohen then discussed Middlesex County Retirement funding, saying that much of the funding comes early and Souza explaining that an actuarial technique called “smoothing” is why it will cost approximately $400,000 more this year.
He added that expected rates of return should likely be assumed at lower amounts in the future.
Cohen then shared revenue projections, saying the amount of the budget being funded by property taxes is higher than ever before due to less state aid from Governor Patrick, particularly from funding obtained by the state lottery.
He added comparisons to comparable communities regarding property taxes increases, saying they were comparable to several nearby communities and that comparable communities were also near the levy limit, stating that most well managed towns are near the limit, with some towns such as Billerica with more commercial growth being further away from the levy limit.
Cohen said that unlike some other nearby towns, there are no major capital projects in the near future, with the last “large” project being the new Billerica Road fire station.
He continued on excluded debt funding, local fees (highlighted by 1,000 more cars registered per year by Chelmsford residents over the last five years), and that it would take $2.3 million to OPEB funding to completely eliminate it by 2045 and that not getting up to $2.3 million would be passing off the issue to future generations.
Contract negotiations have not been concluded with the town’s two police unions.
Cohen recommended in order for the town to reduce reliance on property taxes….
· That the town’s legislative delegation request action on OPEB reform, requiring more years and a higher age for benefits and prorating benefits on years of service.
· The state create a commission on reforming Chapter 70 funding
· Rezoning the 129 business corridor to allow business support services, an extended stay facility, and increased building height to increase commercial occupancy rates.