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APPROPRIATION COMMITTEE REPORT TO STMI NOVEMBER 2006 Article 8: Appropriate Funds Requested Funding Committee for Senior Service Source Recommendation $11,000 GF Approve (94) Program This article proposes to supplement the appropriation of $25,000 made at the 2006 Annual Town Meeting last spring for the new senior service program with an additional $11,000 to permit all eligible applicants to take advantage of the program. Last spring, Town Meeting voted to rescind its acceptance of the statewide senior property tax work -off program under Chapter 59, § 5K of the General Laws, and to substitute in its place a new, locally controlled Senior Service Program. The purpose of replacing the pre - existing program was to free the Town of the restrictions imposed by the State statute on age, wage rate, and credit amount, and in particular to give the Town the flexibility to: • Allow participation by persons under age 60, such as the disabled and handicapped, who might be able to benefit from the program, • Pay a wage higher than the minimum wage, and • Allow more than $750 to be credited against a participant's property tax bill The new program was to be funded by direct appropriation from the tax levy rather than through the Town's overlay account. The funding amount was established at a level only slightly higher than the amount that had been expended from the overlay account during the three preceding fiscal years (ranging from $20,034 in FY2004 to $23,706 in FY2006) under the previous State - defined program. At the time Town Meeting approved and funded this new program, the detailed policies governing the program had not yet been finalized. Subsequently, the Board of Selectmen adopted guidelines that increased eligibility and enhanced benefits in the following respects, compared with the State program it replaced: • Income eligibility was set at $46,300 for single taxpayers or $52,950 for a couple (versus $36,750 if single, $42,000 if married under the State program) • Hourly rate was set at $8.50 (versus minimum wage under the State program, which is now $6.75 and scheduled to increase to $7.50 on January 1, 2007 and $8.00 on January 1, 2008) • Maximum credit was set at $850 (versus $750 under the State program) On the other hand, eligibility under the new program was restricted, in comparison with the State program, by limiting participation to one enrollee per taxable household in the interests of equity. Although the Board of Selectmen has the authority to expand eligibility to persons under age 60 who are disabled or handicapped, they have not yet done so. When these guidelines were set, it was believed that the $25,000 originally appropriated by Town Meeting would be adequate to fund the program. In fact, applications to the program (which were accepted between June 15 and September 15, 2006) exceeded expectations. A total of 43 eligible applicants have applied, which compares with prior participation of 31 in FY2004 and 37 in each of FY2005 and FY06. The combination of higher - than- expected participation and the enhancement of benefits means that if all eligible applicants are admitted to the program and work the full number of hours (100) necessary to earn the maximum tax credit of $850, a total of $36,450 will be required to fully fund the program. In order to make it possible to allow all applicants to participate, Town Meeting is now being asked to make a supplemental appropriation to the program, from available funds, of $11,000. Page 14 of 15