WVN #441: No override -- 5.6% tax increase possible
- Dear Wayland Voter,
Last fall the Finance Committee opposed citizens' successful petitioning to use $4 million in free cash to reduce taxes. Now the FinCom proposes to use nearly $6 million from reserves to avoid a tax override while increasing spending by 3 percent. The plan could raise taxes by an estimated 5.6 percent.
Also in this newsletter: A traffic light in the Historic District is becoming fully operational ahead of schedule because of hazards that might have been prevented if the project had been handled according to permit conditions. And: Alerts from WayCAM and Wayland Democrats.
NO OVERRIDE, 5.6% TAX INCREASE POSSIBLE
Wayland's Finance Committee discussed its draft budget for Fiscal Year 2013 on Feb. 13 and entertained several comments from citizens essentially pleading for more circumspection on spending.
One of the FinCom's stated budget challenges was to be "respectful of pressure not to increase tax rate while maintaining level services." However, the FinCom cites an expected 5.6% tax increase despite its proposed use of nearly $6 million in free cash.
The proposed general fund budget rises 3.02% to $69.28 million compared with the FY 12 budget. The school line item is set to rise 4.4% over the FY 12 budget.
There will be no property tax override, but the operating budget shows a $3.68 million deficit. To solve this, FinCom proposes pulling $3.2 million from free cash, along with $360,000 from ambulance receipts and $120,000 the town receives this year from the high school bond. This is basically a reduction in interest payments. Other free cash would be used for capital spending.
Largely because of borrowing for the new high school, the town's debt is around $70 million. It will be about $74.4 million at the end of FY 12 and plans for FY 13 call for about $68 million.
Remember FinCom's Fall warning?
Voters may recall the FinCom's drastic warning to petitioners at Special Town Meeting last fall that raiding free cash was not prudent and would only elevate tax increases in future years. No such mention is being made with this budget other than the observation that similar amounts of free cash are unlikely to be available in the future. In this instance, the free cash is being used to balance the expanded budget.
FinCom proposes to use $5.91 million of free cash. Currently the town holds $6.3 million -- 8.5% of the budget. The FinCom is estimating $4.99 million might be added to free cash prior to the end of June. This figure does not include the $700,000 sitting in school revolving funds at the end of FY11, as there is a legal question of how to handle those funds. The rest of the free cash is slated for use for the capital budget, $1.7 million, and another $1.01 million to fund articles that may be passed at Town Meeting in April.
The November 2011 Special Town Meeting called by petitioners used $4 million and reduced Wayland's tax rate to $19.01 per $1,000 of valuation from an estimated $20.71, over the objections of town officials. Recently released state figures show that for FY12 (the current Fiscal Year) Sharon has the highest tax rate in the state at $20.11, meaning Wayland would have had the highest tax rate in the state if not for the petitioners' actions. The Finance Committee and Board of Selectmen did not express concern at the time about the potential of having the state's highest tax rate by far and did not call the Special Town Meeting to avert this.
FinCom's stated target for free cash is 7.5% of the budget, which is in the midrange of its preference, but well above the 3-5% recommended by the state. The FinCom presentation estimated the cash balance at the end of June 2012 could range from 3.2% to 7.7%, or $2.2 million to $5.4 million.
General Fund Budget
The general fund budget, which excludes current and potential future enterprise funds (septage, wastewater, and water), shows total expenses in FY 13 are projected to rise 3.02% to $69.28 million from $67.26 million budgeted for Fy 12. The increase from FY 11's actual expenditures of $61.76 million is 10.9%, largely because of high school debt, FinCom members explained.
Including the departments with current and potential future enterprise funds, the town's FY 13 omnibus budget rises 3.08% to $73.45 million from FY 12's appropriated $71.26 million.
The FinCom said it had eliminated more than $2 million of requested items from the omnibus budget prior to the meeting.
The school line item for FY 13 amounts to $32.526 million, a 4.4% rise over FY 12's budget. However, that's not the full cost to the town. The $9.972 million town side line item of `unclassified' includes insurance expenses, much of which is attributed to the schools. The high school debt represents a large portion of the increase in debt service since FY 11.
Debt service for FY 13 is projected to be $7.666 million, or 10.44% of the omnibus budget.
The debt service figure is down $110,495 from the budget of last year, but up 35% from FY 2011's figure of $5.011 million, largely reflecting the high school debt.
The FinCom apparently has heard citizens' cries and decided to not replace all the expiring exempt debt with new debt, as has been its past practice. The proposed payment for nonexempt debt is less than last year, totaling $1.605 million, the FinCom said.
The FinCom proposes to make a prepayment of $1 million for the town's unfunded retirement liability. As with mortgages, prepayment reduces the overall carrying costs. Some may question the timing of this proposal.
Could the budget be lower? Proposals for capital expenditures in the general fund budget amount to $3.84 million, and for the omnibus budget, which includes septage, water and wastewater, the total is $5.4 million, of which $825,000 is for rolling stock.
No analysis has been shown to the public of advantages of owning vs. leasing trucks and other gear.
The borrowing includes projects such as Claypit Hill school floor tiles (the second portion) and paving Claypit parking lot, totaling $190,000, and a "placeholder" for $350,000 for Happy Hollow modules." This is for potentially moving, installing, and retrofitting the modulars at the High School to Happy Hollow. The school committee is awaiting the results of a space utilization study of the elementary schools before making a decision on this item.
The school committee is also asking to spend $70,000 for a school bus.
The budget documents are at http://www.wayland.ma.us/Pages/WaylandMA_Finance/docs
The FinCom slide show is at http://www.wayland.ma.us/Pages/WaylandMA_Finance/FY13budpres.pdf
Citizens asked many questions at the meeting, which can be viewed at:
One surprise to some in the audience was the omission of any benefit from the Town Center project, now under way, which continues to be touted by selectmen and others as critical to the town's financial health. In response to a question, FinCom Chair Cherry Karlson said there will be no financial benefit to the town from Phase 1 of the Town Center construction. The situation will be reassessed if and when a Phase 2 is started.
"So at least at the moment the project will not do us any good?"
"Not on a tax revenue basis," Karlson replied.
Another question involved the School Department's plan to hire an electrician, noting apparently the town lacks control regarding how much overhead and benefits can be added to the town budget without the town's consent. The suggestion was to hire services rather than add personnel to the payroll.
Another resident recommended keeping spending down, in particular trying to hold the line on employee compensation.
Wayland's teacher salary schedule is on pages 30 and 31 of http://www.wayland.k12.ma.us/UserFiles/Servers/Server_1036352/File/District%20Migration/2010-2013WTAAGREEMENTforpdf_002.pdf
The suggestion came as FinCom Chair Karlson asked how the resident would keep spending down given that much of the town's budget is consumed by personnel costs.
A further suggestion was for the town to educate its personnel, and citizens, on the total benefit costs for employees.
FinCom member Richard Stack commented that costs from FY 11 actual results and FY 13 budget were nearly flat, up only 0.7%. But this figure excludes schools and all debt.
-- Molly Upton
NEW TRAFFIC LIGHT FULLY OPERATIONAL -- HAZARD CITED
Police Chief Bob Irving says the new traffic light at the intersection of Routes 27 and 126, in the heart of Wayland's Historic District between the Depot, Grout-Heard House, and the Library, will be fully operational on Friday Feb. 24. The signal was deemed necessary to make the roads safer, but the way the project was handled created even more dangerous conditions.
Normally a new light is left flashing for two weeks to a month to get the public used to having a light where it never was before. But the schedule is being moved up because of the hazardous conditions, he said.
Road changes including the signal were declared necessary because of anticipated Town Center traffic. The developer was able to bypass conditions set by the Wayland Historic District Commission because the selectmen declared the intersection hazardous. Then work started in the fall before meeting the conditions of a Board of Public Works permit that could have prevented a newly created hazard.
The permit conditions would have delayed construction until arrangements had been made to move the utility pole in the middle of the intersection. So the pole remained in place into the winter, creating a greater hazard than existed before.
The pole was removed recently and the lights were installed. But it turned out that new sight lines mean that drivers turning south from 126 may not be able to see northbound cars in the center lane. At least one near-wipeout was reported. Replacing blinking with fully operational lights is expected to help.
Why was the project handled this way? Public Works Director Don Ouellette told the Board of Public Works on Tuesday night that he had issued a "verbal waiver" to allow the developer to start the roadway work. But under the permit only the Board, not the DPW Director, has the authority to issue a waiver.
-- Tom Sciacca
For more background see
WayCam, the town's public access cable channel, reminds Comcast customers that after March 19 analog TV sets won't receive a signal without a digital converter.
Customers using a higher level of service than Limited Basic already have at least one converter. Comcast will supply up to three converters without charge. If you have questions, please contact Comcast:
"http://www.Comcast.com/digitalnow" www.Comcast.com/digitalnow or 1-877-634-4434.
WAYLAND DEMOCRATIC CAUCUS
Wayland Democrats will meet on Saturday Feb. 25 to elect delegates to the Massachusetts Democratic Party's 2012 nominating convention.
The caucus begins at 1 p.m. at the Wayland Public Safety Building. All Wayland residents registered as Democrats as of Dec. 31, 2011, are eligible to take part.
Contact: Michael Gilbreath, Caucus chair, at 508-942-8095 with any questions.
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Wayland Voters Network
Michael Short, Editor