As usual for this time of year, the Town budget forecasts grim. The actual increase is likely to end up lower than the currently projected hike of 8-9% for residential tax bills. But it may not be as much lower as we’d like, since it looks like the Town is facing a bigger than usual challenge this year in trying to rein that in.
Big drivers for tax increases this year aren’t the same one we have seen in the past couple of years.
Over the past few years, the Town had managed to decrease property tax rates despite economic challenges including inflation. However, a property value shift (home values spiking while commercial values decreased) led to significant tax bill increases for residents.[1]
While the real estate market may be starting to calm down, it looks like other economic challenges are now catching up with us.
Adding to Town budget woes are last year’s Town Meeting votes to quash regionalization of public safety dispatch, plus the impacts of police reform laws and the adoption of officer body cams. It turns out that while the cameras were covered by a state grant, the use came with unforeseen administrative burdens that will continue to grow.
Here is an overview of the budget situation and major issues that Town officials and voters will have to grapple with.
Overall Picture
At the January 16th Select Board Meeting, Town Treasurer Brian Ballantine presented what Chair Andre Dennington described as a “very preliminary” FY25 budget that could add over $1,000 to the average homeowner’s tax bill next year. (An update on the situation will be discussed at the February 6th Select Board meeting.)
The overall Operations Budget combined with planned Capital Expenses was projected to lead to a 3.01% tax rate increase, translating to an 8.16% tax bill increase for an average homeowner. It was also based on applying all of the Free Cash that is normally set aside for the Town’s Reserve Fund.[2]
If the Town does reserve the normal amount, it would be a 3.88% tax rate increase and 9.07% bill increase. (Officials and voters will have to decide, should Free Cash be set aside for a rainier day, or is this the time to spend it?)
Ballantine made clear that there are still several unknowns in flux, and they hope the number can come down. But he warned that to get to a “a tax year-over-year increase that’s palatable” will take a $2-3M change ─ through decreased costs and/or increased revenue.
I reached out for clarity and confirmed those figures didn’t assume any real estate shift for this year. If there is another growth in the gap between increased values for residential and commercial and properties, that would have an additional impact to homeowners’ bills.
Significant unknowns last week still included: local receipts, state aid, and how the Select Board will decide to spend remaining ARPA Funds. Select Board member Kathy Cook estimated they had about $400K of ARPA funds that they still need to commit to a purpose. (About $230K is in a bucket for potential purchase of the National Grid parcel behind 5 Main Street, but the board hasn’t seemed to make headway on that front and hasn’t committed to the use.)
Two potentially big increases by two of the Town’s biggest budgets were also on the list.
The Police Chief has requested a big personnel increase to more efficiently staff dispatch and police. That request is still in the air as Select Board and Advisory Committee members figure out what they are willing to support recommending to voters. (Scroll down for details.)
The Southborough Public Schools budget was listed as a 6% increase That figure is actually a bit higher than the latest preliminary recommendation. (Scroll down for details.)
Cook also pointed out that the budget reflects employee salary increases under union Collective Bargaining Agreements and a 5% increase for non-union employees under the Salary Administration Plan. Meanwhile, Local Revenue (which includes excise tax, permit fees, etc.) is flat. Local Aid from the state is also currently listed as flat.
Requested Increases to Police & Dispatch Budgets
At a January 6th joint meeting of the Select Board and Advisory Committee, Police Chief Ryan Newell explained why he was asking for an increase of $639,728 (22.7%) to his operating budget. The answer was staffing needs.
Dispatch Services
Newell pointed out that although dispatch serves both Police & Fire, it is under the Police budget. In recent months, Select Board members have discussed the possibility of pulling it out to its own separate budget. The point would be to highlight the impact of directly running the function rather than outsourcing to a regional emergency communications center.
Last year, the board pursued entering an agreement to transition to a regional dispatch. It was pitched as reducing costs while improving public safety by ensuring that multiple dispatchers were on hand when multiple emergencies are called in. At Town Meeting, voters supported two non-binding Citizen Petition Articles to tell Select Board members that they didn’t want to enter the proposed center in Westborough or any regional center.
Subsequently, the Police and Fire chiefs were charged with coming up with what investments would be needed to properly staff our own department. They came back in December with a request to add $408,786 to increase from 5 full time dispatchers to 9. (Ideally, they would have like an additional two part time positions.) That level would ensure that at least two dispatchers were always on duty.
Select Board members discussed the staffing increase as likely temporary. They still believe that some form of regionalization will be needed long term. They believed that opposition was mainly to details around the Westborough site.
Members Al Hamilton and Sam Stivers have been working on further researching the options. The board agreed that if they pursue an agreement, they would first need to better educate the public about the financial impacts of keeping an in-house operation
Police Budget
The budget also includes a request to hire an additional police officer and Lieutenant.
Chief Ryan Newell said he was looking to split the responsibilities of his second in command into two positions. Instead of a Lieutenant, the department would have an Admin Lt and Operations Lt. Newell explained that the designations are common, and that the need is based on overwhelming new burdens of the job.
According to Newell, the Lt’s time dealing with public records requests have significantly increased. That’s thanks in part to the new body cams. Newell described broad requests from attorneys like asking for all the footage for the past two years from a specific officer’s camera. Since the department is prohibited from sharing some footage due to privacy issues, some images (like those of children) need to be blurred before they can be released. That requires the Lt going through all of the footage. Right, now, the department only has archives back to when cameras were adopted in April. In future years, the burden will increase as more videos are archived.
Advisory and Select Board members questioned having a senior official deal with the task. Newell argued that it needs to be an officer outside of the police union for appearance’s sake. He also argued against civilian personnel, partially for confidentiality concerns. But he also believed that the person viewing the footage should have training and authority to identify and appropriately follow up on any incidents shown in videos of an officer violating laws, policies, or procedures.
Hamilton posited that a “paraprofessional” should be able to handle the minutia under the supervision of the Lt, bringing any issues to their attention. He pointed out that lawyers and doctors employee paraprofessionals that are required to maintain confidentiality. He said he wanted to sit down with Newell to discuss the concerns in more detail.
Newell also explained that general public records requests had increased and required working with IT to pull up old records and to physically go through dead records. Recent requests included work that took 16 and 18 hours. Administrative paperwork had also increased to ensure the department is complying with accreditation standards and state police reforms, and oversight of the evidence room, armory, and holding room.
The chief wants to split those duties out from the operational supervision of Sergeant, patrol officers, Court officers, and the detective unit.
As for the officer, Newell is looking to create a traffic unit, separate from patrol cars. Newell pointed out that one of the biggest complaints they receive is speeding concerns. They tried to address that with over 4,200 radar posts throughout town.
Not only did that pull from patrol, a detective often had to fill in. Newell said that the had over 148 cases to be investigated last year, and each could potentially take a couple of weeks. He noted that the detective is “responsible for background investigation anytime we hire”.
School Budgets
At their February 14th meeting, the School Committee will be presented the administration’s recommended budget for next year. Based on the presentation, it looks like they will be asking for at least an over $1M increase to the budget.
In prior meetings, they’ve gotten a preview through a presentation of the preliminary budget and a presentation of the challenges. As part of their budget exercises, they started with a budget based on meeting the school committee’s and principals and directors’ wish list without any constraints. That would have been an over 15.6% increase. Since then, they’ve been working on reducing the asks while still trying to pursue the School Committee’s identified priorities.
At a January 10th meeting, Superintendent Gregory Martineau presented a budget with a 5.18% ($1,194,546) increase. based on assumptions entailing “Reduction of 5 instructional positions.” He highlighted that the budget could go down to 4.5% or up to 5.5%, depending on choices made.
Lowering it would include additional “Reduction of 1-2 positions”. The increase would incorporate an additional instructor and pursuing a new bus contract, rather than extending the existing one. The swing was shown as $230,644.
In the presentation, the increased cost of supplies and materials due to inflation was cited as one of the big drivers for cost increases, but no figure was given. The other specified cost drivers only accounted for about 25% of the big increase. Presumably, salary increases for existing personnel are also a part of the picture.
As for the costs that were outlined. . .
$130K was for new staffing position. About 60% of that is to hire a new World Language Teacher for Woodward School ($80K+). This is to continue a program that was launched this school year at Finn School. Introductory Spanish classes for K-1 students were added to this year’s curriculum. (Two 30 minute lessons per week). The administration is now looking to continue and expand that program for first graders moving onto Woodward. A world language program for K-3 is among the school committee’s identified priorities.
There were some priorities that come with staffing increases, that weren’t incorporated into the version presented for next year:
- Seek to add math specialists to support K-8 students (4 FTE)
- Seek to add health educators in grades K-5 (1 FTE)
If the School Committee decides not to push those off to a future year, that would up the budget.
Other challenges for this year’s budget also include escalating curriculum materials cost, over $165K of which had been previously paid through federal grants issued in response to pandemic challenges. (The schools had enjoyed support through CARES, CRRSA, ARPA and ESSER acts. ESSER grants phase out this year.) Much of that is the cost of curriculum materials which shot up over the past couple of years.
Martineau explained that companies shifted their model from selling textbooks and materials that cover several years to the model of licensing materials per student per year, at a higher price point.
Assistant Superintendent Stephanie Reinhorn further explained that during the past few years, a lot of grant money went into curriculum, and buying was done through the state which paid the bills directly. That allowed vendors to raise prices, since districts weren’t pushing back on fully covered costs. In the long run, with schools now bearing costs, she hopes the market will improve. But that is the landscape they are currently faced with.
Reinhorn pointed out that a downside of the old model had been dealing with a big payment every several years, rather than an annual fee. And Martineau noted the silver lining is that updated materials are made available immediately.
The current budget includes a 2% increase to transportation costs through extending the current contract one year. (Looking at last year’s budget, that is just over $8K.) Martineau said that if they instead decided to seek a new contract, they project going out to market for a new bid would result in a 25% increase.
In materials posted for tonight’s Regional School Committee Meeting, a memo described the bus situation which is driven by a shortage of drivers. It states:
For the 2023-2024 school year, out of 76 days of service, [the current contractor, NRT,] was not able to provide 32 drivers for 49 days (64%) resulting in either doubling or canceling of bus routes. In addition, the District experienced a “disruption to service” (significantly delayed routes) 38 days out of 76 days of service (50%). This disruption in bus service is directly related to NRT’s inability to have consistent drivers driving the routes.
On most days, the District has bus routes being covered by substitute drivers. Substitute drivers are not familiar with the routes, the students, or the community, which has resulted in poor route performance including missed stops, inconsistent route times, and miscommunication between drivers, dispatch, and schools.
You can see the Preliminary Southborough School Budget presentation deck here, and watch the presentation here. The presentation included a reminder that the committee has historically been keeping its budget increases lower than inflation.
The Preliminary Budget for Algonquin Regional High School to be presented shows an overall 4.82% increase ($1,281,081). That could translate to a 7.42% increase in Southborough’s assessed payment ($631,588). However, if they apply rainy day funds, they could keep that down to just a 3.04% increase of $258,322.[3]
Using the E&D fund this year could temporarily ease the increase. However, that could create a bigger budget shock the following year.
The Regional School Committee will hear the budget presentation tonight at 6:30 pm. (You can view the agenda here.)
Both school committees are expected to vote on budgets in February.
[1]For FY2023, the tax rate was a 9.34% decrease from 2022 but translated to a 5.58% tax bill increase for an average home as appraisals increased. This year’s rate was 5.75% lower, but average homeowners are seeing a 4.78% tax increase.
[2]Free Cash is the Town’s unrestricted available funds generated when revenue collections are more than budget estimates and/or when expenditures and encumbrances (unpaid bills and orders) are less than appropriations, or both. They are certified at the beginning of the new fiscal year.
Reserve Funds are basically the Town’s rainy day fund for unforeseen expenses. Unlike Free Cash, the amount in this fund is actually appropriated each year at Annual Town Meeting. Spending from this fund requires approval by the Advisory Committee.
[3]Under state law, regional schools are allowed to utilize an E&D (Excess & Deficiency) fund ─ banking unforeseen revenue/savings to draw from in future years with unforeseen costs. You can read more about that in my post about the FY21 budget.
