2015-11-02-AC-STM#2-rpt - Laserfiche WebLink

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APPROPRIATION COMMITTEE - NOVEMBER 2015 STM #2 Because Lexington's annual MWRA water assessments are based on its share of the total water used by all MWRA communities in the most recently completed full calendar year, the temporary spike in Bedford usage had the effect of increasing Lexington's MWRA water assessment for FY2016 (based on Lexing- ton's increased share of total MWRA usage in calendar year 2014), and will also increase the assessment in FY2017 (based on Lexington's increased share in calendar year 2015). During this fall's water and sewer rate - setting proceedings, therefore, it was decided to apply $275,000 of retained earnings resulting from Bedford's excess usage to mitigate the additional Bedford - related costs in FY2016; and to set aside the re- maining $131,000 of the surplus to offset the additional Bedford - related costs in FY2017. At the 2015 annual town meeting, an appropriation of $200,000 was made from the water fund's retained earnings for rate relief (down from an appropriation of $250,000 the previous year as part of a gradual pro- cess of "weaning off" of annual rate subsidies). This subsidy proved not to be necessary to maintain stable rates because, due to a reduced MWRA sewer assessment and high irrigation usage this past summer, the Selectmen were able to reduce the FY2016 water and sewer rates slightly on a combined basis even with- out the subsidy. Netting these two developments, it is proposed to cover the increased FY2016 MWRA costs attributable to Bedford by increasing the previous appropriation from water fund retained earnings by $75,000, bringing the total FY2016 appropriation to $275,000. 3. Adjustment for Changes in Debt Service. The figures for water and sewer fund debt service included in the FY2016 budget appropriated at the 2015 annual town meeting were estimates. Following bond sales in February 2015, the actual amounts are now known and were used in setting the FY2016 rates this fall. As a housekeeping matter, it is proposed to adjust the appropriation for water fund debt service downwards by $71,394 to the actual amount of $1,344,114; and to adjust the appropriation for sewer fund debt service upwards by $119,777 to the actual amount of $1,060,456 No adjustments are required to the recreation enterprise fund budget. Community Preservation Fund Budget The motion under this article may include a restatement of the allocation of funds to the four specific re- serves in the Community Preservation Fund based on new information on the amount that Lexington will receive as State matching funds. The match amount is expected to be higher than that assumed at the 2015 annual town meeting. An action at this special town meeting will be possible if the State match information is received in late October or early November, i.e., before this special town meeting is dissolved. Other- wise, no action will be proposed. The Committee recommends approval of all proposed actions under Article 7 (7 -0) Article 8: Appropriate To and From Specified Stabilization Funds Funds Requested Funding Source Committee Recommendation See below SF revenue Approve (7 -0) 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. Lexington's first specified stabilization funds were established at the 2007 Annual Town Meeting. 8