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APPROPRIATION COMMITTEE-2019 ATM
<br /> debt service. The atypical decline in Cash Capital reflects a pullback in cash capital spending for FY2020,
<br /> but capital spending in coming years is expected to revert to recent historical trends.
<br /> The Challenge Ahead: Priorities and Planning
<br /> The Introduction to last year's Report to the 2018 Annual Town Meeting ended with a section labeled,"The
<br /> Challenge Ahead: Balancing Need to Upgrade Infrastructure with Taxpayer Impact". That section com-
<br /> mented on the financial situation as of March 2018 along with the challenges facing the Town. It sounded
<br /> a note of concern about Town finances in the coming years, and that concern is even more pressing today.
<br /> To be sure, the Town's financial situation is robust, but we face choices now and in the immediate future
<br /> that will test our priorities and demand a disciplined approach to the planning and implementation of our
<br /> capital and operating budgets.
<br /> Three overriding factors drive this concern. First, the Town is carrying a significant amount of debt, the
<br /> result of funding many capital projects over the past decade, some of which were large enough to require
<br /> 30-year bond durations. Second,Lexington is now in the state's top ten list for residential property tax bills,
<br /> the result of strong and continuing growth in the operating budget combined with the debt service for"ex-
<br /> cluded"debt. Third,the Town is anticipating several additional significant capital projects and it has yet to
<br /> approve most of the funding that these projects will require. if approved, this new funding would require
<br /> additional debt which would sustain the pressure on the Town's property tax rate in the coming years.
<br /> The existing debt has allowed the Town to fund much-needed improvements, including the renovation and
<br /> replacement of many school buildings, and the construction of modern facilities that are vital to public
<br /> safety. At the same time, these recent projects limit the Town's ability to fund new projects until the debt
<br /> service declines.
<br /> In FY2019,the tax bill for a single-family(SF)home of average value in Lexington ranked 8th in the state.
<br /> Lexington's total annual property tax levy is also in the top ten and is exceeded by only a few of the largest
<br /> cities in the state. This fact has far-reaching impacts on the Town due to the higher cost of living and the
<br /> barriers to entry. High property values mean that low-and moderate-income families find it difficult, if not
<br /> impossible,to afford a home in Lexington, and the tax burden further constrains the size of a mortgage that
<br /> these households can afford. Retirees who purchased a home long before the current period of housing
<br /> inflation often choose to move elsewhere because the growing tax burden threatens their fixed/limited in-
<br /> come. The end result is a population dominated by comparatively wealthy families, many with school-age
<br /> children.
<br /> Municipality Rank Avg. SF Avg. SF SF Tax
<br /> Tax Bill Home Value Parcels Rate
<br /> Weston 1 $20,016 $1,589,799 3,361 12.59
<br /> Lincoln 2 $16,118 $1,148,815 1,521 14.03
<br /> Sherborn 3 $15,952 $813,047 1,329 19.62
<br /> Dover 4 $15,693 $1,213,681 1,829 12.93
<br /> Wellesley 5 $15,406 $1,331,551 7,301 11.57
<br /> Carlisle 6 $15,016 $821,011 1,713 18.29
<br /> Concord * 7 $15,125 $1,034,633 4,591 14.19
<br /> Lexington 8 $14,834 $1,050,585 9,030 14.12
<br /> Wayland 9 $13,719 $750,469 4,066 18.28
<br /> Winchester 10 $13,083 $1,080,308 5,658 12.11
<br /> *estimated
<br /> Source:MA Dept.of Revenue,Division of Local Services Municipal Databank
<br /> The debt that funds most of the Town's major capital improvements is contingent on voter approval. The
<br /> most recent excluded debt referendum held in December 2017 succeeded, granting the Town the authority
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