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HomeMy WebLinkAbout1981-05-26-AC-ATM-rpt APPROPRIATION COMMITTEE SUPPLEMENTAL REPORT The Appropriation Committee has just completed a frustrating six months . Not only did we have the problem of a very tight budget facing Lexington because of Proposition 2 1/2, but we also tried to visualize where the money could be obtained to maintain an even righter budget under the new law. The budget considerations them- ' selves involved much discussion and re-evaluation as to the order of priority for the many services which the Town renders to its citizens. The sources of revenue were also a problem. The Appro- priation Committee is strongly opposed to initiating new or addi-' tional fees for services such as sewer, water, etc. This is equivalent to increasing the real estate tax and not reducing it according to the purpose of 2 1/2. It again puts the burden on those who can least afford the increased financial obligation. We also felt that Lexington should dip sparingly into its "free cash" because the next few years are critical under 2 1/2 and the money will be needed and may not be obtainable. In the early fall, the revenue situation under 2 1/2 looked reasonably promising. -- At that time, the "word" to us indicated that the property evaluation, now in progress, would adhere to the formula which sets the -upper limit for the total real estate tax levy for 1982 - 1983. This project, through the Assessor' s Office, is about completed. We felt, upon reviewing the emerging figures from this project that the increase in the valuation would • be sufficient to produce enough revenue to help finance a reasonable and modest budget for next year and yet meet the legal limitation on the tax rate. In fact we felt (after examining the new proposed budget) that the tax bill to individual taxpayers might well be reduced if the re-evaluation value came in at the upper limit of the probable range. It soon developed, however, that the property re-evaluation would play no part in the formula and that the real estate tax as a source of revenue would be limited to 1.025 times the total billed for the current year. This, of course, is a fixed number and we immediately asked for and received the estimate for the other revenues which the Town would receive, such as fees, state aid, etc. When this estimated additional income was added to the legal allowable real estate tax, we were $354, 366 short of meeting the operating budgets for the Town and School Department, assuming nothing in addition to this budget was voted by Town Meeting itself., The Appropriation Committee was extremely disturbed about { $1, 200 , 000 which was to be taken from the "free cash" in order to arrive_ at the above deficit of approximately $350, 000 . At last year' s Town Meeting time, the suggested amount of "free cash" to reduce the tax rate was then only $1, 000 , 000 . At the insistance of the Treasurer and the Appropriation Committee a figure of $750, 000 was finally chosen as a compromise and presented to Town Meeting, where it was voted. Most of the members of the • Appropriation Committee felt $500, 000 would have been a better figure . The $750, 000 amount was a fortunate choice over the $1, 000, 000 or we would have been in much worse financial shape as many other Towns have found out in the last few months, to their dispair. The $500, 000 would have been still better for the present situation, although the increased tax rate for last year would hardly have been popular. APPROPRIATION COMMITTEE SUPPLEMENTAL REPORT -2- As the Town Meeting Members face the 1981 Town Meeting under the monetary restriction of 2 1/2, they should realize Lexington is indeed fortunate in many ways, compared to many cities and towns . The actual operating budget of the Town has been kept under control for the past few years, with increases mostly in the ne- gotiated salary budgets and uncontrollables such as fuel, light, etc. Many of the items which have contributed to our increasing tax rate during the last few years were not in the service area, but in the direction or more or better equipment, swimming pool, etc. , which can be easily eliminated temporarily to comply with tight budget restrictions . The School Committee has also greatly contributed to our good financial condition by facing up to the reality of a greatly_ reduced student body. Buildings have appropriately been closed despite the unpopularity of the moves and the savings have been very large. The. School Committee has also reduced the size of its staff in proportion to the decline in school population, thus maintaining the same student-teacher ratio during this era. When this Committee first examined the 1982 F.Y.. Budget we were very pleased at the effort that had. been made to hold down the Town Operating Budget and the School Committee Budget not withstanding the nigh inflation rate of- the past year, particularly in the uncontroll- able costs. _: We feel that the Selectmen, Town Manager, School Committee and the Superintendent of Schools should be praised for their efforts in - this direction. We only hope that the next few years will not be too critical for us. It. would be unfortunate for all if we have to cut too deeply into the services rendered to the Citizens of Lexington in- the near future. Moreover, the Appropriation Committee feels that there is still reasonable opportunity for additional small cuts in the .Operating _ -- Budget for both the Town and Schools in the coming fiscal. year. _ It is clear to everyone that all services rendered to the citizens in both the above categories are not equally important and effective. Thus small cuts in some items would not markedly change the effectiveness of services to the consumer public . However, the Committee feels that the Ordering of the priorities and thus the designation of those items to be cut in this instance should be the function of the Committees responsible for the opera- tions . The Selectmen and School Committee should thus be the origina tors of the recommendations presented to the Town Meeting. Two weeks ago, the Appropriation Committee were prepared to make the following recommendations so that Lexington would meet the short-fall of approximately $354, 000 . 1. Cut the Lexpress from $207, 000 .(which is their estimate of needed subsidy before new bids have been opened) to $90, 000 . This is the figure the Town Meeting voted two years ago when they raised their request from $50 , 000 to $90, 000 in order to give the idea its maximum poten- tial as a useful and nearly self-supporting service for 9 1/2 months . The $90, 000 gives practically 12 bus/ hours per day (Est. $30. 00 per hour) without any cost to the rider . With a good fare structure it could provide very reasonable service to the elderly and commuters, with a little judicious thought as to the method of operation for a full year. This was the original purpose of the Lexpress concept. APPROPRIATION COMMITTEE SUPPLEMENTAL REPORT -3- 2. The remaining $237, 000 (approximately) in cuts would come from the Town Operating Budget and the School Budget in the ratio of 45% to 55% which is their approximate share of the total town annual expen- diture. The cuts would, of course, be made on those items which the Selectmen and School Committee felt would have the least impact upon their operation. The Appropriation Committee reiterates again that they were not happy with this solution because it involved the $1, 200, 000 taken from "free cash" . However, we felt it entirely unfair to propose more drastic cuts at this late date when the complete legal operation of 2 1/2 finally became clear. Less than two weeks ago a new estimate was presented of all revenues including General Revenue Sharing Funds, unexpectedly it was $583, 000 larger than the estimate made in October. The return from increased fees was greater than anticipated, coupled with high interest rates earned on our surplus cash. As soon as this fact became apparent, the Selectmen proceeded to wipe out the deficit of $354, 000 and add to their budget and to articles which they wished to support. Most of the approximately $600, 000 is recommended to be spent on the basis that these new items need to be done and will cost more in the future. Today is a very special situation, different from the past, and we do not concur in this philosophy: What needs to be done is done, but only at the expense of some other items which were planned. Next year and the year after, are going to be very difficult under 2 1/2 unless changes are made in the law or its interpretation. These we cannot count on before they happen. Our negotiated salaries are going up at the rate of 7% per year and our uncontrollable costs at a much faster rate. The tax receivables for real estate will go up only 2 1/2% . We will need the cash, and need it badly, if we are to maintain reasonable services to the citizens . The Appropriation Committee feels that it would indeed be negligent if we did not call this to the attention of the Town Meeting by instigating positive action. We feel that the $583, 000 should be used, but that amount subtracted from the "free cash" of $1, 200, 000 which was to be recommended to the Town Meeting for transfer, thus utilizing only about $617, 000 of our "free cash" . This will, in reality, bring us back to square one with the necessity of cutting back about $350, 000 as stated earlier in this report. In order to give the Town Meeting Members an opportunity to vote on this important issue, we shall propose that Article 73 ("free cash" transfer) be taken up in advance of Article 39 (origi- nally Article 4) in other years . Under this Article 73 we shall propose that the amount of "free cash" which is to be used in the 1981-82 Town Budget shall be restricted to $625, 000 . APPROPRIATION COMMITTEE SUPPLEMENTAL REPORT -4- The 4-The Appropriation Committee makes the following recommendations on Articles 38 through 73 (except Articles 46, 52, 53,66 already voted) : ARTICLE 38 - SUPPLEMENTARY APPROPRIATIONS FOR CURRENT FISCAL YEAR (FY81) . Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 39 - OPERATING BUDGET. Recommendation: This Committee has recommended that the Board of Selectmen and the School Committee cut the total Operating Budget by $237, 000, and further does not re- commend in favor of the three line items for which in- creases were requested in the recent budget changes, namely - Council on Aging, Mystic Valley Mental Health and Snow Removal. ARTICLE 40 - SALARY ADJUSTMENTS AND COLLECTIVE BARGAINING SETTLEMENTS . Recommendation: Favorable Action, $275,000 requested. ARTICLE 41 - PRIOR YEARS' UNPAID BILLS. Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 42 - D.P.W. . SUPPLEMENTAL APPROPRIATIONS REQUESTS . Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 43 - RESERVE FUND. Recommendation: Favorable Action, $150,000 requested. ARTICLE 44 - SELECTMEN'S APPRAISALS AND OPTIONS . Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 45 - REQUEST FOR REPORT ON SEWER CONSTRUCTION. No Recommendtion. ARTICLE 47 - INSTALLATION OF WATER MAINS . Recommendation: Favorable Action, $275,000 requested. ARTICLE 48 - DRAINAGE STUDY. Recommendation: Unfavorable Action, ($50,000 was requested) . ARTICLE 49 - INSTALLATION DRAINS/WIDENING, DEEPENING OR ALTERING BROOKS . tecczinendation: Indefinitely Postpone, no funds requested. ARTICLE 50 - INSTALLATION OF DRAINAGE-OUTLOOK DRIVE. No Recommendation. ARTICLE 51 - STREET ACCEPTANCE-OUTLOOK DRIVE. No Recommendation. ARTICLE 54 - AUTHORIZE USE OF CHAPTER 90 FOR STREET IMPROVEMENTS. Recommendation: Favorable Action. ARTICLE 55 - INSTALLATION OF CURBING. Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 56 - INSTALLATION OF STREET LIGHTS. Recommendation: No funds requested. ARTICLE 57 .- INSTALLATION OF SIDEWALKS . Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 58 - PUBLIC WORKS EQUIPMENT. Recommendation: Favorable Action, $131, 000 ($146, 000 was requested) . APPROPRIATION COMMITTEE SUPPLEMENTAL REPORT -5- • A TICL E 59 - DEVELOPMENT OF WESTVIEW CEMETERY. Recommendation: Indefinitely Postpone, no funds requested. ARTICLE 60 - GARRITY HOUSE - RECONSTRUCTION. Recommendation: Indefinitely Postpone. ARTICLE 61 - GARRITY HOUSE - HOUSING AUTHORITY. Recommendation: Indefinitely Postpone. ARTICLE 62 - GARRITY HOUSE - LEASE. - Recommendation: Indefinite Postpone. A_?TICLE 63 - PARKING IMPROVEMENTS. Recommendation: Unfavorable Action, ($42, 100 was requested) . ARTICLE 64 - DEEP WELL WATER SUPPLY. Recommendation: Unfavorable Action ($10 , 000 was requested) . A=IC E 65 - TENNIS COURT REPAIRS - - Recommendation: Unfavorable Action, ($41, 700 was requested) . ARTICLE 67 - CONSERVATION GIFT. No Recommendation. ARTICLE68 - CONSERVATION FUND. Recommendation: Favorable Action. ARTICLE 69 - LEXPR ESS-MINI-BUS TRANSPORTATION SYSTEM. Recommendation: Favorable Action, $90 , 000, see text of report ($207, 000 was requested) . ARTICLE 70 - TRANSFER OF SCHOOL. Recommendation: Favorable Action, $50, 000 requested. A=T`CLE 71 - UNEMPLOYMENT COMPENSATION FUND. Recommendation: Favorable Action, $40, 000 requested. ARTICLE 72 - CENTRAL MIDDLESEX ASSOC. OF RETARDED CITIZENS . Recommendation: Favorable Action, $5, 000 requested. ARTICLE 73 - USE OF "FREE CASH" . Recommendation: Favorable Action, $625, 000 ($1,200,000 was requested) ._ Respectfully submitted, APPROPRIATION COMMITTEE George P . Wadsworth, Chairman William J. Dailey, Jr. , Vice Chairman Richard M. Perry, Secretary, Ex-Officio (Non-voting) Esther S. Arlan John Campbell Robert Cataldo Harry A. Hall, III Maxine Kutchin Barry H. Marshall George S . Silverman