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HomeMy WebLinkAbout2026-04-27 Finance SummitFinancial Summit Select Board, School Committee, Appropriation Committee, Capital Expenditures Committee Monday, April 27, 2026 A Financial Summit was called to order by Select Board Chair Jill Hai at 7:30p.m. on Monday, April 27, 2026, via zoom hybrid meeting platform in Battin Hall, Cary Memorial Building, 1605 Massachusetts Avenue. Present for the Select Board (SB): Ms. Hai, Chair; Mr. Pato; Mr. Lucente; Mr. Sandeen; and Ms. Kumar as well as Mr. Bartha, Town Manager; Ms. Axtell, Deputy Town Manager; and Ms. Kosnoff, Deputy Town Manager for Finance. Present for the School Committee (SC): Ms. Jay, Chair; Ms. Lenihan; Ms. Carter; Mr. Freeman; and Ms. Roy; as well as Dr. Hackett, Superintendent of Schools. Present for the Appropriation Committee (AC): Mr. Parker, Chair; Mr. Padaki; Mr. Ahuja; Mr. Bartenstein; Mr. Levine; Mr. Michelson; and Mr. Osborne. Present for the Capital Expenditures Committee (CEC): Mr. Lamb, Chair; Mr. Boudett; Mr. Rubenstein; Ms. Rhodes; and Mr. Cole. All boards and committee called their groups to order. ITEMS FOR INDIVIDUAL CONSIDERATION 1. Discussion: March 30, 2026 Proposed Amendment to Annual Town Meeting Article 4 Ms. Jay (SC) explained that the proposed amendment to the original amendment is to alter the dollar figure of the amendment to a total of $625,000. $250,000 of that would go toward the difference between purchasing a one-year versus a five-year plan for the new literacy curriculum. It would overall save funding and allow for a long-term plan for the curriculum purchase. The remaining $375,000 would go toward five staff positions - specialized literacy and math coaches. There is a commitment and guarantee that these positions would only be one-year positions, chosen to be transitional and training support. She noted that there is a lot of concern in the community regarding how finances are managed. Building community confidence will be an ongoing priority. The School Committee will make a commitment to build mechanisms to make public information regarding school finances more accessible and readable. Mr. Freeman (SC) explained that the main driver behind this compromise is an understanding regarding the relationship between the School Committee, Select Board, and finance committees. The agreement between these four entities is essential to the success of Lexington. In terms of the McKenna amendment, it became clear that the finance committees were not in support of it and the Select Board was not in support of it. The need for the new literacy curriculum comes from the students and educators, and the literacy specialists requested would help take advantage of the full functionality of the curriculum. Ms. Lenihan (SC) reviewed some of the MA communities in the past two years that have had an operating override. The Massachusetts Municipal Association’s Executive Director recently stated that the State, through the unrestricted government aid formula, has not kept up with inflation. When it comes to Prop 2 ½, the number is likely no longer reflective of the realities of the cost environment. This compromise will allow the Town to meet some very specific needs of its students. Ms. Carter (SC) stated that for many people the reputations and the strengths of the schools are a key component of the community’s strength. If the Town is not thoughtful and careful in this transition, there is potential to do damage to the schools and its students. The SC is not looking to give away any of the responsibilities or powers that are given to it. Ms. Roy (SC) urged reconsideration for the funding of the extra literacy and math specialists. These specialists will work directly with struggling students in general education classrooms. They will identify children who are falling behind, they will intervene early, and they will provide targeted support before needs escalate. In this particular year, teachers are being asked to implement a brand-new literacy curriculum while staffing is being reduced. This is a significant shift in how reading is taught. Even excellent teachers need time and support to internalize a new framework and apply it with fidelity. Having extra specialists in the room this year, working directly with those students while the teacher is building confidence with the new material is not a luxury. This is how to protect children who cannot afford to wait. Delayed identification and intervention do not save money; it defers costs and multiplies them. Every child identified and supported early in a general education setting is less likely to require the more intensive and expensive services that follow. She asked that the funding for these one-year positions be considered not as a permanent commitment or as a rejection of fiscal discipline, but as a recognition that the most vulnerable learners deserve this year of support. Ms. Jay (SC) stated that, during its earlier meeting, the School Committee voted to support the compromise proposal on the condition that all parties of the summit are in agreement. If that is not the case, the original amendment should be reverted to. Ms. Hai asked if the proposed compromise amendment is $250,000 for educational materials and $375,000 for five one-year coaches, for a total of $625,000 of Free Cash to be allocated toward the school budget. Ms. Jay agreed and noted that the exact breakdown of the coach positions would be determined in consultation with the Superintendent. At the end of FY27, there would be a guarantee that these positions would not move forward. Mr. Michelson (AC) stated that when the budget was built, Page 1 of the Brown Book and Page 2 of the Superintendent's memo mention that there is currently $750,000 of Free Cash for purchase of a curriculum. He asked if this is the same curriculum being proposed for the additional $250,000. Ms. Jay (SC) stated that it is the same curriculum, but the additional funding allows for five years of the materials, instead of only one year. Mr. Padaki (AC) stated that the Appropriation Committee has reviewed the information and remains unanimously opposed to using Free Cash for ongoing operating expenses. Free Cash should be reserved for one-time expenses. He explained that Dr. Hackett has indicated that the proposed $1.25M would be used to support 13 FTEs for one year to manage the transition and provide retirement incentives for senior staff. These 13 FTEs were not discussed during the development of the FY27 budget, yet they are now considered critical. The AC is concerned that, despite the Superintendent's commitment, these or similar positions may need to be retained next year, leading to a continued structural imbalance in the budget. Secondly, the Appropriation Committee strongly opposes a retirement incentive program for multiple reasons. It is undesirable when want to replace highly experienced and expert staff with inexperienced and less trained staff. It sends the wrong signal to teachers, leads to faster cost growth later, and shifts costs from salaries in the school budget to health insurance in the shared expenses budget. Third, two members of the School Committee have offered a compromise option to appropriate $625,000 to support a five-year literacy curriculum license and to reinstate five specialized positions. The Appropriation Committee agrees with using $250,000 from Free Cash for the license. However, the Appropriation Committee cautions against using the remaining $375,000 for operating expenses, even if intended for one year only. In terms of potential impact on bond ratings, the Appropriation Committee agrees with the Town Manager that a $1.2 M appropriation from Free Cash would likely not impact the Town's rating by itself. However, ratings are complex, and the Town must avoid policies that negatively impact its standing. Finally, even as the Appropriation Committee supports many of the changes in the FY27 school budget which move it towards structural soundness, the AC remains concerned about the potential underfunding of aspects of that budget and the outcome of the upcoming negotiations with bargaining units. Mr. Bartenstein (AC) asked if Ms. McKenna has agreed to the proposed compromise resolution. Ms. Jay (SC) stated that the Moderator has said that it is possible for someone to amend the amendment, which would then be discussed on Town Meeting floor. Mr. Levine (AC) expressed concern that this is being framed as either approving an amendment to raise the school budget, allowing for $250,000 to purchase additional parts of the curriculum and $375,000 to support five positions for one year, or the full $1.25M to support 13 positions and other things. He stated that whether the McKenna amendment or the compromise proposal passes, the circuit breaker in year of reception funds spending will be reduced to below $1M. This means that there is at least $2.8M that the schools will have available to spend in a discretionary manner. If the 13 or 5 positions and the curriculum support materials are so important and critical, it is unclear why they were not included in the base budget. He would be surprised if those items could not be supported in the budget, even if the amendments are not adopted. He stated that he would like to understand why the School Department cannot use $625,000 more in year-of-reception circuit breaker funding to support those positions, even without an amendment. Ms. Jay (SC) explained that, given limited revenues and outsized expenses, the budget was created and was not a level service budget. In moving from Budget Summit III and to Budget Summit IV, the SC and Superintendent put in a request for $800,000 in order to help with budget items. She noted that there were 60 FTE staff reductions announced in February/March. 40 of those were from enrollment reductions and 20 were for budgetary reasons. Some of those cuts were a little deeper than needed to happen. 75% of the cost avoidance from staff reductions is going toward not having to draw into the circuit breaker funds. 25% of the cost savings from staff reductions will backfill some of the other budget items. Contrary to what some people believe - that the reliance on safety nuts is not financially responsible, she believes it is the opposite. Mr. Osborne (AC) stated that the groups went through the budget process with a lot of compromise. There was an understanding in the end, at least from the school side, that the agreed upon budget would not negatively impact learning outcomes. Listening to the School Committee members advocate for more money, currently changes the context of the conversation. If the original budget did not negatively impact learning outcomes, as was the agreed upon goal, it is unclear if these requests are niceties that could be sought with additional money, or if there was a misunderstanding in that the original budget actually did have a negative impact on learning outcomes that was not realized when the original budget was voted on. Ms. Jay (SC) explained that the original budget involved some sacrifices, many of which were going to affect learning outcomes. The School Committee was working within the revenue it had. The School Committee is now trying to make the case that these positions, due to the upcoming transition of the literacy curriculum, would have a positive impact on student learning, and could lead to an avoidance of higher costs for students who struggle. Mr. Padaki (AC) stated that there were 160 pink slips issued and approximately 60 FTEs impacted with the original budget. He believes some of these positions have been reinstated. He asked about the status of the $1.25M if the 13 FTEs are reinstated, and if the five FTEs are reinstated. Ms. Jay (SC) explained that the 60 FTE staff reductions are positions. Those positions will not come back, unless the amendment or the compromise passes. 20 positions of those positions were budget related. If the compromise passes, 5 of those 20 positions would be retained for one year. If the McKenna amendment passes, 13 of those 20 positions would be retained. The pink slips are an entirely different process, and it should be assumed that those 60 will no longer be there next year. There is a process to review all vacant positions, including some vacated by people temporarily, retirements, and open positions, with the administration then matching people to those jobs.People who were pink slipped are also eligible to be placed in jobs that match their skills. After that process was completed, there were 25 people who were not placed, and there are still efforts to place them. It was not the case that 160 people lost their jobs. Mr. Lamb (CEC) stated that, in a perfect world, the Capital Expenditures Committee would not support this because Free Cash for operating includes insurance and retirement. In the spirit of moving forward, the Capital Expenditures Committee endorses the compromise. The Capital Expenditures Committee will not condition its vote on certain measures being taken, specifically the committee being proposed, but it strongly encourages the same type of transparency that has been discussed in this meeting with respect to major capital projects applied to the School Committee budget. The proposed compromise amendment is supported 6-0 and the original amendment is rejected 6-0. Nina Pickering Cooke, Town Counsel, explained that the amendment on the floor of Town Meeting is to the budget article, including financial figures and appropriation amounts. This does not include any other legal obligations or commitments. The SC has made representations during this meeting and to the other boards, but the only thing that would change in the article is the appropriated number. If the compromise amendment passes and $625,000 is added to the school’s base budget, Mr. Michelson (AC) asked if the SC will then insist that the amount be included in the calculation for the revenue split next year. Ms. Hai (SB) stated that any one-time allocations from Free Cash are typically pulled out and not considered a roll forward for the base budget. Ms. Hai (SB) stated that the Select Board sees the use of Free Cash to purchase curriculum supplemental materials as a one-time purchase that can be supported. There was some concern regarding the use of Free Cash for staffing. However, the Select Board discussed that, with the unanimous support of the groups present, it could be on board to bring everyone together and help close a difficult budget for one year. The SB was and remains unanimously opposed to the original McKenna amendment. Mr. Sandeen (SB) stated that $700,000 is proposed for the first-year literacy program costs, with another $250,000 proposed to get through five years in total of the program. He asked what happens after the five years. Ms. Jay (SC) stated that once the curriculum is purchased, there is an annual charge for materials every year thereafter. The five-year purchase will gain some savings, and the cost afterwards would likely be approximately $90,000 per year to come from the school's operating budget. Ms. Hai (SB) stated that the Select Board will support the proposed compromise amendment, with a commitment that the groups will begin to work on the fiscal policy group’s organization and parameters. She also stated that the Select Board sees this as a one-time compromise and would not expect to see or support such a request in a following year. Under those conditions, the Select Board supports the compromise amendment by a vote of 4-1. Mr. Padaki (AC) stated that the Appropriation Committee still has concerns regarding using some of the $625,000 for salaries, though the majority are willing to accept this as a one-time commitment by the SC and Superintendent. The AC supports the compromise by a vote of 5-3. Ms. Jay (SC) stated that the School Committee supports the compromise by a vote of 5-0. DOCUMENTS: Town Manager - 4-24-2026 Memo.pdf; Town Manger Presentation Summit IV Town Meeting 4.27 (with sources and ERIP).pdf; LPS Presentation - McKenna Amendment Budget Summit.pdf; LPS Request - Article 4 Amendment; 04-26-2026 - LPS Response to TM Memo.pdf ADJOURN Upon a motion duly made and seconded, the Select Board voted 5-0 by roll call to adjourn the meeting at 8:42p.m. The Appropriation Committee, Capital Expenditures Committee and School Committee followed suit. A true record; Attest: Kristan Patenaude Recording Secretary