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APPROPRIATION COMMITTEE REPORT TO NOVEMBER 2011 STM retained earnings and$300,000 from sewer retained earnings appropriated at the 2011 annual town meet- ing) were 7.3% for water and 15.8% for sewer, or a combined rate increase of 12.9%. With the applica- tion of the additional $200,000 in water retained earnings voted by the Board of Selectmen on October 24, 2011, the final rate increases set for FY11 (and that have already been included in fall water bills) were 3.9% for water and 15.8% for sewer, or a combined rate increase of 11.8%. The Committee recommends approval of each request in this article(9-0). Article 5: Establish and Funds Funding Committee Requested Source Recommendation Appropriate to Specified Stabilization Funds $417,305 (see below) Approve(9-0) This Article is routinely included on the Warrant to give Town Meeting the opportunity to appropriate money into stabilization funds created for specified purposes. These appropriations are not expenditures, but rather transfers of funds that Town has been holding temporarily into the proper accounts. The State statute authorizing towns to create and maintain a stabilization fund (G.L. c. 40, § 5B) was amended in 2003 to permit the creation of multiple, separate stabilization funds for specified purposes. Creating these funds, altering their specified purpose, and appropriating into or out of them, requires a two-thirds vote of Town Meeting. At the 2007 Annual Town Meeting, four Specified Stabilization Funds were established to replace certain pre-existing special revenue accounts. The amounts and sources for the Specified Stabilization Funds relevant to this Article are summarized in the following table: Specified Stabilization Fund (SF) Amount Source Traffic Demand Management/Public Transportation SF $10,500 Cubist Pharmaceuticals Traffic Mitigation SF $28,500 Cubist Pharmaceuticals Avalon Bay School Enrollment Mitigation SF $378,305 Avalon Bay Transportation Demand Management/Public Transportation (TDM/PT) S.F.: Contains payments negoti- ated with developers to support the operations of Lexpress. A $10,500 payment from Cubist Pharmaceu- ticals, as described in Article 3 of the 2009 Fall Special Town Meeting,will be transferred to this fund. Traffic Mitigation (TM) S.F.: Contains payments negotiated with developers to support traffic mitigation projects, such as improvements to signals and pedestrian access at intersections, including funds previous- ly contained in the Avalon Bay TDM special revenue account. A $28,500.01 payment from Cubist Phar- maceuticals, as described in Article 3 of the 2009 Fall Special Town Meeting, will be transferred to this fund. Avalon Bay School Enrollment Mitigation S.F.: Contains payments received from Avalon Bay pursuant to an Education and Trust Fund Escrow Agreement dated May 31, 2006 and can be used by the Lexington Public Schools. The final$378,305.59 payment from Avalon Bay will be transferred to this fund. The Committee recommends approval of this request(9-0). Page 15