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APPROPRIATION COMMITTEE - STM 2018-1 Introduction This introduction provides a brief overview of significant budgetary developments since the close of the Annual Town Meeting, the reasons for convening a special town meeting this fall, and the major financial issues which will be addressed. Committee Membership Since the Annual Town Meeting, the Committee has seen the departure of two members, Jian Helen Yang and Andrei Radulescu-Banu, who were succeeded by Glenn P. Parker and Nick Nichols. We thank Helen and Andrei for their commitment and service to the Committee. Reserve Fund Following the 2018 Annual Town Meeting, the Committee approved a transfer from the FY2018 Reserve Fund of $106,000 to fill an unforeseen gap in funding needed to support a master planning process by the School Committee. The balance of $794,000 flowed to Free Cash as of July 1, 2018. As of publication, the Committee has approved no Reserve Fund transfers during FY2019, and this fiscal year's balance remains at $900,000. Special Town Meeting The Town called this Special Town Meeting in part because of two requests for zoning changes, one of which has since been withdrawn. Because most zoning changes have an indirect, and often only marginal, effect on the finances of the Town, the Appropriation Committee does not routinely comment on them. However, the Committee may from time to time consider cases where a zoning request anticipates a new development that could have a material impact on the demographics and finances of the Town. Article 10, a proposal to rezone land on Watertown Street currently owned by the Belmont Country Club to permit the construction of a senior living facility with 156 independent/assisted living units and 48 memory care units, presents such a case due to the large number of new dwelling units and the accompanying age restrictions. In this report, the Committee offers its commentary on the proponent's financial impact analysis, which is typically provided by developers of any large project coming before the Planning Board. The commentary does not conclude with any recommendation, either for or against, the proposed rezoning, but we hope that our report provides some insight into the relevant financial considerations. The Town continues on a path of steady growth with a significant addition from "new growth" to the total assessed value of properties, which in turn raises the levy limit for the Town. This Special Town Meeting provides an opportunity to recognize actual FY2019 new growth realized in excess of the estimate used at the 2018 Annual Town Meeting in this case an increment of about $770,000. This additional revenue may be used to fund operating and/or capital needs that have arisen since the FY2019 budget was approved. One capital need originally anticipated to be presented at this Special Town Meeting has been rendered moot. At a summit meeting held in June 2018, the School Department presented an urgent need for addi- tional science laboratory classrooms at Lexington High School due to enrollment growth. The initial pro- posal was to construct two new science laboratory classrooms, which would have required an appropriation at this Special Town Meeting of approximately $1 million. Subsequently, the School Department deter- mined that, for the coming year, the need could be resolved by scheduling changes. Consequently, the request for construction funds was withdrawn. Finally, this is an opportunity to implement timely adjustments and corrections to the budget for the current fiscal year. Such adjustments simplify the Town's financial management by making funds available sooner, rather than deferring action until the spring. This also reduces the amount of budgetary work needed at the following annual town meeting. 2