Category Archives: Budgets

OPEB – we owe $42m.

Posted on July 3, 2015 | Comments Off on OPEB – we owe $42m.

The town has had Stone Consulting produce an actuarial  valuation, as of 10/11/2013, of the town’s Other Post Employment Benefits (OPEB), which was just received and shows that the present value of what the town owes is $42m.

The OPEB are the cost of medical care in the future for current and retired town employees, that has already been earned by them, but mainly has not yet been funded by the town. In other words, the town contractually committed to provide the future medical care for its town employees, but just never set aside or paid any monies to cover those future costs.

The General Standards Accounting Board (GASB) only recently required government entities to both figure and report on OPEB, and as a result we have now learned that the town has a $42m. financial obligation for which it has made little preparation.

The facts:

  • The valuation is figured assuming a 4% discount rate, and other assumptions greatly change the amounts owed.
  • $18.9m. is the present value of the total amount that will be paid in the future to current employees.
  • $23.9m. is the present value of the total amount that will be paid in the future to current retirees.
  • $3.5m. per year would be required to be paid for 26 years to fully fund OPEB.
  • $1.7m. is the cost to pay OPEB benefits incurred in the current year on a pay as we go basis.
  • $400,000 (from memory) is the amount that we funded OPEB in our budget this fiscal year, and we have only funded OPEB for 2-3 years and not at that level.
  • By not fully paying for the current year obligations to OPEB, we are making the total owed even larger, this year adding another $1.3m.

The size of the OPEB problem appears to be so large that to me it appears we would all have to pay double real estate taxes for one year to fully fund it.  The town needs to make some hard choices as to how to deal with this looming financial problem created by the past promises the town made to its town employees.  To me it no longer makes sense to merely mostly ignore the dilemma, as we have been doing.

Stone Consulting will be at the Selectmen meeting on July 7 to present this new valuation report.

CLICK HERE TO SEE THE 10-11-13 VALUATION.

CLICK HERE TO SEE THE 2011 VALUATION

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Posted in Budgets

Visual budget

Posted on June 30, 2015 | Comments Off on Visual budget

To understand Medfield’s town budget, would it help to have the budget presented in a graphic format such as Mansfield does (http://www.mansfield.visgov.com/) or Arlington (http://www.arlingtonvisualbudget.org/)?

The software to do this is open source software, so we can do this with no cost if our employee IT staff implement it.  When I spoke with the creators, the www.visgov.com people at the Massachusetts Municipal association’s annual meeting in January, they told me that we could also pay them to install it.

Christian Donner has created a demo site for Medfield (http://medfieldbudget.org/), but the actual numbers appear to  not be our actual budget figures – still it gives one a sense and taste of what is possible.

I find it useful, but I would want to be able to drill down even further into the budget number details.

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Posted in Budgets

BoS discretionary funds violates TM control

Posted on June 30, 2015 | Comments Off on BoS discretionary funds violates TM control

Town Accountant Joy Ricciuto today queried the DOR legal department about the Warrant Committee’s suggestion that the selectmen have discretionary authority over $25,000 to $50,000 of spending a year, and learned that it is an impermissible delegation of the  authority vested with the town meeting.  Below is Joy’s email and the DOR response.

I sent an email to the Mass DOR Legal Department and received a telephone response.
Don Gorton is the lawyer who responded, and below is a summary of his answer,
The creation of a Discretionary Spending Fund looks problematic, the appropriation has to have parameters, or is an improper appropriation.  This is too broad, and rules against abdicating the role of town meeting.  Appropriating is the role of town meeting, cannot circumscribe the authority of town meeting to appropriate.  This exceeds the bounds of permissible delegation.
Don Gorton said he was happy to talk to anyone if they have further questions.  He can be reached at 617-626-2400, the Bureau of Municipal Finance Law.
Joy

———- Forwarded message ———-
From: Joy Ricciuto
Date: Tue, Jun 30, 2015 at 1:24 PM
Subject: Discretionary fund for Selectmen-please advise
To: dlslaw@dor.state.ma.us

Question:
The Town of Medfield Warrant Committee (Finance Committee) and the Board of Selectmen are discussing the creation of a ‘Discretionary Spending Fund’ set up for the Selectmen in the range of $25,000 to $50,000 appropriated for the Selectmen to decide how it would be spent. The intent is to place such value judgments within the purview of an elected body
Please advise as to the permissibility and  legal appropriateness of establishing this type of fund.
Respectfully yours,.
Joy A. Ricciuto, CGA
Town Accountant

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Posted in Budgets

Better budgeting next year

Posted on June 27, 2015 | 3 comments

At the last Selectmen meeting, the Warrant Committee came to discuss improving on the town’s budget process.  I suggested we record “action items” related to the budget discussions we held, so things discussed would get accomplished, and Richard DeSorgher turned my idea around on me by asking me to write up the action items. Hence, below are my suggested action items from our discussion. Responsible parties to complete tasks were not always assigned in the discussion, and in my draft I have merely suggested a responsible party.

This is a good start to bringing greater discipline and transparency to the town’s budget process, which is needed.  Ultimately, I would like to see the budgets and as much of the budgeting process as possible be on-line, so residents can have easy access the data, information, and financial decisions by which their town is run.  I suggest that we put the details of the budgets and town checkbook on-line, just as the state now does, so residents can have that easy access to the information.

Future new initiatives, such as the Straw Hat Park, should not be required to overcome a “steep learning curve” about the town budgets to accomplish its task.  To flatten that learning curve, I propose that the town administrator publish a guide for them to use on how the town’s budget process operates.

6/16/15 Financial Planning Meeting

Attending:
Board of Selectmen
Warrant Committee
ACTION ITEMS

  1. New town initiatives
    1. budgets need to be discussed at time new initiatives are recommended
    2. discretionary budget of $25,000 – $50,000 for the Board of Selectmen
      1. RESPONSIBILITY = town administrator
        1. to create discretionary budget;
        2. to make sure the Board of Selectmen and Warrant Committee confer and agree on budgets for new initiatives; and
        3. create a guide to the budgeting process for future new initiatives to follow
  2. Capital budget
    1. require five year projections
    2. creation of a 20 year capital improvement budget
      1. RESPONSIBILITY = town administrator
  3. Operating budget
    1. Uniform format for proposed budgets – (not discussed or resolved)
      1. RESPONSIBILITY = town administrator
    2. Budget calendar – create and share a template to reuse year by year going forward
      1. RESPONSIBILITY = town administrator
    3. early meetings of Warrant Committee and the Board of Selectmen with department to establish budget parameters
      1. RESPONSIBILITY = Warrant Committee and town administrator
  4. September meeting to discuss budgeting issues and planning for the future
    1. RESPONSIBILITY = town administrator

3 Comments

Posted in Budgets, Select Board matters

Budgeting discussions tonight

Posted on June 16, 2015 | 1 comment

The Warrant Committee has sent the BoS the memo below of the budgeting issues it plans to discuss at tonight’s BoS meeting.

I had a list of budgeting issues I had developed this spring for a planned joint meeting of the BoS, Warrant Committee, and Water and Sewer Board in response to the budgeting conflicts W&S had with the Superintendent this year before town meeting (I am told that joint meeting has been postponed to the fall), and i have attached my proposed agenda after the WC memo.

 

MEMORANDUM
To: Medfield Board of Selectmen
From: Michael T. Marcucci
Warrant Committee Chairman
CC: Members of the Warrant Committee
Michael Sullivan, Town Administrator
Scott McDermott, Town Moderator
Date: June 14, 2015
Re: Issues for Discussion at June 16, 2015 Selectmen’s Meeting
______________________________________________________________________________
This Memorandum sets out several issues that members of the Warrant Committee would like to discuss at our June 16 meeting. The goal is to identify ways to improve the Town’s budgeting process and enhance the coordination between the Board of Selectmen and the Warrant Committee. The suggestions expressed here do not represent the views of the entire Warrant Committee and are raised for discussion purposes only.

Discretionary Spending: This year’s debate over Straw Hat Park has prompted discussion about how similar proposals should be addressed in the future. While there is no consensus on how the resolve the issues, several possibilities are identified below.

* Selectmen’s Discretionary Fund- one possible resolution would be to create a fund to be spent at the Selectmen’s discretion. The amount (in the range of $25,000-$50,000) would be appropriated in advance and the Selectmen would then decide how it should be spent. Thus, the Selectmen—and not the Warrant Committee—would be assessing the relative merits of various proposals within budget limits imposed by Town Meeting. If this cannot be done formally, it can be done informally by an agreement from the Warrant Committee to support some amount of discretionary spending recommended by the Selectmen. This would place these sorts of value judgments within the purview of an elected body.

* Advance Budget Guidance—As Gus Murby has noted, we are concerned about abusing volunteers’ time by asking them to undertake a project with no certainty of funding the outcome of that work. One possible resolution would be to provide joint budget guidance in advance. This would always be subject to the risk that other events would squeeze out funds when the budget is finally prepared but would at least provide some guidance about a budget range the Selectmen and Warrant Committee would be comfortable recommending to Town Meeting for the type of project contemplated.

Capital Budget: the capital budget process needs to be reformed. The current approach of fixing a set amount each year for capital spending which is then allocated by the Capital Budget Committee over several meetings at the end of the budget process does not allow for sufficient planning or flexibility. The amount of capital spending each year should be flexible based on the capital needs of the town and available funds each year. One possible approach would be to identify all capital needs over a 5 year period, which will then be prioritized by the Capital Budget Committee and then may be funded as appropriate over that period. The amount funded annually will vary with circumstances, but, over time, the capital projects of the town will be funded as needed.
We should also address within the capital budget process the sort of capital projects, like the Wheelock boilers and the traffic study this past year, which are capital projects but end up in separate warrant articles. Even if, as a matter of law or procedure, certain capital items must be voted on as separate warrant articles, they should still be vetted by the Capital Budget Committee and considered as part of the town’s capital plan.

Medfield State Hospital: As expressed in the past, the Committee is generally of the view that the Town should come to a resolution of the Hospital site sooner, rather than later. Preferably, this will be done some time in 2016. Whatever the Town decides to do with that property will have a significant impact on the Town’s finances for the foreseeable future. Given that, it seems that a simple up or down vote on a proposal to develop the property is insufficient. If the Town chooses not to develop the property, we must address the long term costs of ownership, which likely will require either increased taxes or cuts in other budgets. Otherwise, both expected and unanticipated costs associated with the Hospital property will squeeze out other budget priorities. The most prudent course may be to address this issue alongside any vote on a proposal from the
Medfield State Hospital Master Planning Committee.

Water & Sewer: Pete and I have discussed a joint meeting with the Warrant Committee, Selectmen, Water & Sewer Board, Ken Feeney and Mike Sullivan to sort out the  Water & Sewer budget process. We are happy to participate in such a meeting.

 

This was my suggested set of budget issues that I saw which needed to be addressed:

Financial Planning Meeting

Attending:
Board of Selectmen
Warrant Committee
Water and Sewer Board

AGENDA

1. Operating budget
a. Data – what data do boards need to create their budgets
i. e.g. – W&S tool
ii. dates and/or schedules
b. Responsibilities for generating the data
c. Uniform format for proposed budgets
i. last two years actual
ii. actual spending last prior full year
iii. requested next year – + explanations of changes

2. Capital budget
a. five year projections
b. total budget amount – how set?
i. NB – Arlington uses 5% of operating budget as its expectation

3. Budget calendar
a. create a template to reuse year by year going forward
i. e.g. – week 1 – all town boards meeting (in September)
week 2 – . . .
week 34 – annual town meeting (ATM)
b. meetings to set parameters
i. who is included
ii. selectmen should weigh in on expected increases
c. establish responsibilities and time lines for meeting
i. assign departments to dates
d. compare to timing and process in Amherst, Arlington, and Dedham (see attached)

4. Planning for the future
a. Mike Sullivan to plan for his successor
i. to create and document a written how to do the Medfield budget guide
ii. to document each step as he takes it in the first year, so town has a written budget road map of what needs to be done to create the budget each
iii. to cross train Kris to do all the steps in the budget process next year
b. Transparency
i. implement www.opengov.com and/or www.visgov.com (open source)
ii. implement the state’s system of putting its checkbook online
iii. implement the Willis Peligian tool town wide
iv. implement proper governance over budgets and associated expenditures:
(1) require budgets to include realistic operating and capital expenses; &
(2) include a separate contingency line item in each budget

5. Create a Business Manager for town, similar to business manager for the schools

 

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Posted in Budgets, Financial

Senate budget

Posted on May 22, 2015 | Comments Off on Senate budget

This is how we do under the Senate’s budget –

FY2016 Local Aid Estimates
All Municipal
FY2015 Cherry Sheet Estimate
FY2016 Governor’s Budget Proposal
FY2016 House Final Budget Proposal
FY2016 Senate Final Budget Proposal
FY2016 Conference Committee
Education:
Chapter 70
3,730,480,705
3,828,556,906
3,830,886,519
3,833,516,810
School Transportation
154,078
110,488
124,430
130,136
Charter Tuition Reimbursement
76,974,357
74,728,135
74,431,420
81,866,459
Smart Growth School Reimbursement
436,743
436,743
250,000
436,743
Offset Receipts:
School Choice Receiving Tuition
45,494,828
46,648,312
46,648,312
46,648,312
Sub-total, All Education Items:
3,853,540,711
3,950,480,584
3,952,340,681
3,962,598,460
General Government:
Unrestricted Gen Gov’t Aid
945,750,001
979,797,001
979,797,001
979,797,001
Local Sh of Racing Taxes
816,585
710,500
710,500
710,500
Regional Public Libraries
2,501,833
2,521,970
2,601,883
2,601,883
Urban Revitalization
1,286,806
1,286,306
1,286,306
1,286,306
Veterans Benefits
50,344,210
51,516,162
51,516,162
51,516,162
State Owned Land
26,770,000
26,770,000
26,770,000
26,770,000
Exemp: VBS and Elderly
24,416,788
24,673,163
24,673,163
24,673,163
Offset Receipts:
Public Libraries
9,000,000
8,826,300
8,847,300
9,029,000
Sub-Total, All General Government
1,060,886,223
1,096,101,402
1,096,202,315
1,096,384,015
Total Estimated Receipts
4,914,426,934
5,046,581,986
5,048,542,996
5,058,982,475
Although the School Lunch program is funded in both the FY2015 final budget and the FY2016 Governor’s, House Final and Senate Final budget proposals, we have removed the estimate from the cherry sheet as this program is an education offset that has no impact on the tax rate setting process.

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Posted in Budgets, Legislature

Does Medfield want open data?

Posted on May 18, 2015 | Comments Off on Does Medfield want open data?

I have suggested that Medfield’s budget data and checkbook should be online so that anyone can easily see what the town spends its monies on and can also easily research the town budget priorities.  There are software apps that make this easy to do.  The state uses one to put its checkbook online, and i have seen two apps that focus more on the department budget side of the data, via http://www.opengov.com and http://www.visgov.com, which would provide their apps for a few thousand dollars a year.  Visgov.com is actually open source software, and we could use it at no cost if we installed it on our own.

The selectmen, the Warrant Committee and the Water and Sewer Board are supposed to meet soon to resolve budgeting issues that arose in the months prior to the annual town meeting,  and I am suggesting that we use that financial summit meeting to both resolve expectations as to our budgeting process going forward, but also to implement online budgeting to make the town finances more transparent.

Therefore, I was especially interested when today I saw the article below that indicates a high percentage of residents want the data available to them and expect that having it available will make their towns operate better.

Study: How Tech Can Improve Citizen Engagement

in Community Development, Innovation, Latest Posts, Technology & IT May 18, 2015

Citizen Perceptions of Data
The Pew Research Center recently conducted a survey to benchmark public sentiment on government initiatives that aim to leverage open data streams to improve services. The survey aimed to gauge:

  • People’s awareness of government efforts to share data
  • Whether these efforts translate into people using data to track government performance
  • If people think government data initiatives have made, or could make, government performance better or improve accountability
  • The more routine kinds of government-citizen online interactions

The survey analyzed citizen perception of government data use in the early stages at the local, state and federal levels. Overall, the public seems optimistic of open data government initiatives – specifically with improving accountability. While most participants use online data portals to find basic government information, the vast majority are not using the information to monitor government performance.

The Findings
The survey revealed:

  • 65 percent of Americans have used the internet to find data or information about government in the last 12 months
  • 19 percent could think of an example of where the local government did a good job providing information to the public about data it collects
  • 19 percent could think of an example of where the local government failed to provide enough information about data and information to the public
  • 56 percent hope open data can help journalists better cover government activities
  • 53 percent hope open data can make government officials more accountable
  • 49 percent expect open data to improve the quality of government services
  • 48 percent want open data to allow citizens to have more impact on government affairs
  • 45 percent predict open data to enable government officials to make better decisions

The majority of respondents are comfortable with the idea of government agencies collecting and sharing public data on a variety of platforms. Yet many remain cautious of providing their own data to the government such as mortgage information.

Driving Engagement
According to a recent IDC Government Insights report governments should invest in 3rd platform technologies – cloud, mobile, social and big data – to effectively drive citizen value and engagement. The study predicts more than 50 percent of government agencies will direct at least 25 percent of their citizen engagement budgets to 3rd platform technologies and the Internet of Things (IoT) solutions by 2020.

New digital channels coupled with a more comprehensive approach to redefining the citizen experience will align the goals of values of local leaders and residents. The research identifies five maturity stages for the citizen experience to help governments better understand the needs and goals of each group and select appropriate technologies to meet these expectations:

  • Ad hoc: Citizens request information across multiple channels
  • Opportunistic: CRM applications enable front-end automation so citizens can access information on their own
  • Repeatable: Digitization of workflows across channels allow citizens to handle services through full automation
  • Managed: Digital self-service allows citizens to show across multiple agencies and enables interactive handling of citizen requests
  • Optimized: Omni-channel citizen experience ensures consistent, convenient experience at very low cost to the government

The research suggests investment in 3rd platform technologies and the Internet of Things will help governments reduce costs while improving overall performance and accessibility. These interactive solutions better deliver new capabilities to public agencies and residents, while optimizing resource allocation and improving the way services are delivered.

Lack of Awareness
One major constraint many public agencies face when considering investment in new technologies and the Internet of Things is a lack of knowledge. A recent survey found only half of American adults are familiar with the term Internet of Things – which refers to the network of physical objects embedded with sensors and technologies to collect data that will guide decision making to improve services.

Because many Americans are unaware of how the Internet of Things works with existing infrastructure and services, 85 percent have concerns about the increased risk to breach of security and privacy. Furthermore, 70 percent fear IoT investment will have a negative impact on daily interactions and 51 percent are concerned about technical issues and the cost of repairing them.  If the public had a better understanding of how IoT and other new technologies are driving efficiency, there may be more support behind these investments.

Related Content
Challenging Tech Community to Solve Civic Problems w/Apps
Community at the Center of Civic Hacking
3 Cities Optimizing Open Data

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Posted in Budgets, Financial, Information, Select Board matters

MMA on Senate version of state budget

Posted on May 18, 2015 | Comments Off on MMA on Senate version of state budget

This alert this morning from the Massachusetts Municipal Association on the Senate deliberations tomorrow on the state budget, highlighting issues important to towns. –

Monday, May 18, 2015

SENATE DEBATE ON FY 2016 STATE BUDGET BEGINS TUESDAY – CALL YOUR SENATORS

Lawmakers Will Decide the Fate of 942 Amendments

Please Call Your Senators Today on the Budget Amendments that Impact Key Municipal and School Priorities

The Massachusetts Senate will begin debating the $38 billion fiscal 2016 state budget on Tuesday, May 19th. The deliberations are expected to take several days, as Senators have filed 942 amendments to make changes to S. 3, the Senate Ways & Means Committee’s budget recommendation that was released last week.

Many of these amendments would directly impact cities and towns, including a number of welcome amendments that would increase funding for municipal and school aid accounts. This Legislative Alert describes the most important amendments that will be debated.

Please Call Your Senators Today

Please call your Senators as soon as possible today to secure their support for those amendments that would help your community.

Lawmakers must hear from you on these issues. Because of the great number of amendments, the summaries here are very brief. Please contact MMA Legislative Director John Robertson at jrobertson@mma.org or 617-426-7272 x122 at any time if you have questions or need more details.

When you call your Senators, please make sure to thank them for the proposals in the Senate budget to increase Unrestricted General Government Aid by $34 million (matching the budgets from the Governor and House), and for the $18.2 million increase to fully fund the Special Education Circuit Breaker.

Please Click Here to Download a Copy of the MMA’s Budget Letter to the Senate

Please Click Here to Visit the Senate Budget Website to See the Amendments: The Senate budget committee recommendation (S. 3) and all proposed amendments are posted on the Legislature’s website at: https://malegislature.gov/Budget/FY2016/Senate/ChamberActions

KEY BUDGET AMENDMENTS ON SCHOOL AND EDUCATION FUNDING

Adequate Chapter 70 Minimum Aid for Municipal and Regional Schools
The MMA is calling for a sufficient funding increase for Chapter 70 school aid to ensure that all municipal and regional school districts are able to reach the “foundation” level of spending, implement the equity provisions adopted in 2006, and provide an adequate amount of minimum aid that ensures that all schools receive an increase in fiscal 2016.

The Governor proposed a fiscal 2016 Chapter 70 increase that sets minimum aid at only $20 per student for 245 cities, towns and school districts, an insufficient amount to maintain current school staffing and services. The Senate budget would increase minimum aid to $25 per student, but in reality this still leaves too many schools unable to maintain quality school programs. Recognizing that the Foundation Budget Review Commission will not file its report until mid-2015, far past the deadline for inclusion in the fiscal 2016 state budget, the MMA is urging the House to adopt a higher minimum aid amount to prevent further erosion in school financing at the local level.

• Please ask your Senators to Support Amendment 94 filed by Sen. Eldridge and Amendment 100 filed by Sen. Hedlund to increase the “minimum aid” amount to $50 per student. This amendment would benefit 245 cities, towns and school districts, and give these communities a better chance of maintaining the quality of their existing education programming.

Reimbursements for Charter School Losses
The diversion of Chapter 70 school aid away from public schools to pay tuition to charter schools has imposed a major and growing financial burden on cities and towns, a problem made more acute as the state grants more charters and existing charter schools expand. Local officials strongly support full funding of the Commonwealth’s commitment under section 89 of Chapter 71 of the General Laws to reimburse school districts for the loss of a portion of their Chapter 70 aid that is redirected to fund charter schools.

In fiscal 2015, it is expected that cities and towns will be forced to divert $444 million to fund charter schools, 10 percent of all Chapter 70 dollars. This illustrates the importance of this issue to local governments, and why it is critical for the state to meet its commitment to this program. The original $80 million appropriation in the fiscal 2015 general appropriations act was $30.5 million below the full funding amount required in the statutory formula, which was signed into law only a few years ago. The problem has deepened with two rounds of 9C cuts to this account ($3.1 million), increasing the fiscal 2015 shortfall to at least $33.6 million.

The funding shortfall means that cities and towns are receiving only a fraction of the reimbursements due according to state law. This is impacting a large number of communities, including some the state’s poorest and most financially distressed cities and towns. Thus, the underfunding of the charter school reimbursement formula is harming the most vulnerable and challenged school districts and communities.

The House and Governor’s fiscal 2016 budget would level fund charter school reimbursements at $76.9 million, even though local payments to charter schools are expected to increase by $56.5 million. Full funding of the statutory formula would require $133.5 million. Without these funds, cities and towns will face another major shortfall next year, and result in cutbacks for the vast majority of students who remain in the traditional public school setting. The SW&M budget would provide $80 million, which is still far below the necessary funding.

• Please ask your Senators to Support Amendment 616 filed by Sen. Chang-Diaz, and Amendment 608 filed by Sens. Hedlund and Moore. These critical amendments would fully fund charter school reimbursements due to cities, towns and regional school districts by providing the full $133.5 million necessary to meet the state’s obligation.

McKinney-Vento Homeless Student Transportation Costs
In fiscal 2013, the state budget provided $11.3 million to fully fund the state-mandated costs that resulted from the Commonwealth’s adoption of the federal McKinney-Vento Act. The State Auditor ruled that the McKinney-Vento program was an unfunded mandate on cities and towns, and the Legislature provided full funding soon after that ruling. Under the program, communities are providing very costly transportation services to bus homeless students to schools outside of the local school district. However, the fiscal 2014 state budget reduced McKinney-Vento reimbursements to $7.4 million, underfunding this state mandate. Full funding for this year is estimated at $19.8 million, but the Commonwealth level-funded the program at $7.35 million, creating a shortfall of $12.5 million in the current fiscal year.

The House and Governor are proposing a $1 million increase for fiscal 2016 to bring funding for McKinney-Vento reimbursements up to $8.4 million, yet the SW&M budget would level-fund the program at $7.4 million. Full funding for this state mandate would require $20.8 million, according to the most recent DESE projection.

• Please ask your Senators to Support Amendment 586 filed by Sens. Eldridge and Lesser, Amendment 569 filed by Sens. Lovely and Barrett, and Amendment 611 filed by Sens. Hedlund and Moore that would fund reimbursements due to municipalities and school districts for the cost of transporting homeless students from temporary shelters to school. In addition, please ask your Senators to Support Amendment 33 filed by Senator Lovely that would protect cities and towns that host homeless families from reduced room occupancy excise revenues as a result of the state’s emergency assistance (EA) program.

Regional School District Student Transportation Reimbursements
Funding for transportation reimbursements to regional school districts is vital to all regional districts and their member cities and towns, particularly in sparsely populated parts of the state. The Legislature appropriated $70.3 million for fiscal 2015, but, unfortunately, Governor Patrick used his 9C powers to cut the amount in November by 27 percent, an unexpected $18.7 million loss, returning the program to fiscal 2014 levels just months after coming closer to full funding. Decades ago, the state promised 100 percent reimbursement as an incentive for towns and cities to regionalize, and the consistent underfunding of this account has presented serious budget challenges for these districts, taking valuable dollars from the classroom. The Governor’s budget proposal would level-fund regional school transportation reimbursements at $51.5 million, dropping the reimbursement percentage down to 64 percent. The Senate Ways and Means Committee would restore $5 million to this key program in fiscal 2016, and bring funding up to $56.5 million, a positive and helpful increase, yet still below the funding needed.

• Please ask your Senators to Support Amendment 545 filed by Senator Gobi and others, Amendment 522 filed by Senator Humason and Amendment 612 filed by Senators Hedlund and Moore that would build on the progress in S. 3, and bring transportation reimbursements to regional school districts closer to the original fiscal 2015 appropriation.

Out-of-District Vocational Education Student Transportation
The fiscal 2015 state budget included $2.25 million item to reimburse communities for a portion of the $3.8 million cost of transporting students to out-of-district placements in vocational schools, as mandated by state law. This account recognizes the significant expense of providing transportation services for out-of-district placements, as these students must travel long distances to participate in vocational programs that are not offered locally. Governor Patrick slashed all funding with his November 9C cuts, a painful mid-year loss. The SW&M budget does not include any funding.

• Please ask your Senators to Support Amendment 574 filed by Sen. Gobi to fully fund the $3.9 million cost of transporting students to out-of-district placements in vocational schools.

Kindergarten Expansion Grants
177 cities, towns and regional school districts in every corner of the Commonwealth use this important grant program to support full-day access to local kindergarten programs – including communities in virtually every Senate district. Funding for the program in the fiscal 2015 general appropriations act was $23.9 million before being reduced through two rounds of 9C cuts to $18.6 million. The Governor’s budget recommendation would eliminate all funding in fiscal 2016, an extremely disruptive step that would force participating communities to immediately decide whether to end or scale back their current kindergarten programs or cut other school and classroom services. Real progress was made in the House budget, with Representatives voting to restore the program to $18.6 million. However, the SW&M budget would reduce the program down to $1 million. We strongly support restoring Kindergarten Development Grants to at least the fiscal 2015 post-9C level of $18.6 million, and are asking Senators to also consider restoring the program to the original $23.9 million level.

• Please ask your Senators to Support Amendment 549 filed by Senator Joyce and Amendment 613 filed by Senator Hedlund and others to level fund this account at the fiscal 2015 appropriation.

Circuit Breaker for English Language Learners
One of the many lessons learned from the six public hearings held by the Foundation Budget Review Commission last year and into this Spring is that cities and towns struggling to meet the educational needs of an increasing number of students with special needs separate from special education programs. This includes low-income and English language learner (ELL) students.

• Please ask your Senators to Support Amendment 550 filed by Senator Fattman that would establish a “circuit breaker” program for English language learners, laying the foundation for future financial assistance from the Commonwealth.


KEY BUDGET AMENDMENTS ON MUNICIPAL AID PROGRAMS AND MUNICIPAL MANAGEMENT POLICY

Payments-in-Lieu-of-Taxes (PILOT)
The Payment-in-Lieu-of-Taxes (PILOT) program is a particularly important program for the cities and towns that host and provide municipal services to state facilities that are exempt from the local property tax. This account is underfunded at $26.77 million this year, and is still below fiscal 2008 funding. Many of our state’s smallest communities rely heavily on PILOT payments, and shortfalls in this account have a significant impact on their ability to deliver basic municipal services. House One and S. 3would level fund PILOT at $26.77 million.

• Please ask your Senators to Support Amendment 101 filed by Sen. Hedlund to add $3.5 million to increase PILOT payments to cities and towns, and bring the account up to $30.3 million.

Shannon Anti-Gang Grants
• The Shannon Grant program has been very effective in enabling cities and towns to respond to and suppress gang-related activities. Please ask your Senators to Support Amendment 697 filed by Sen. Donoghue to increase funding for the Shannon anti-gang grant program. This amendment would add $2 million and bring total funding up to $8 million, which is the original fiscal 2015 appropriation.

Safe and Successful Youth Initiative
• Please ask your Senators to Support Amendment 813 , filed by Sen. Chang-Diaz to increase funding of the Safe and Supportive Youth Initiative from $5 million to $7.58 million. The program seeks to reduce youth violence through wrap-around services for those most likely to be victims or perpetrators, and is vital to violence prevention efforts in dozens of communities.

Summer Jobs for At-Risk Youth
• Please ask your Senators to Support Amendment 428 filed by Sen. Wolf to increase funding for youth summer jobs from $11.5 million to $12 million. This funding is critical to providing employment opportunities for at-risk teenagers in our cities and towns, especially with youth unemployment rates climbing.

Protection of Municipal Emergency Medical Services
• Please ask your Senators to Support Amendment 775 filed by Sen. Donnelly that would prevent the practice of “pay the patient,” by insurance companies, which undermines the ability of cities and towns to fund and operate responsive and efficient ambulance services that are at the core of emergency medical services in Massachusetts. “Pay the patient” would force communities to pursue their own residents to recoup thousands of dollars in ambulance expenses, a system that is inefficient and subject to abuse. Amendment 775 would also clarify that municipalities are authorized to set a fair rate for ambulance services. Cities and towns set fees and charges for a wide variety of municipal services very strictly limited by state law to the cost of providing the service. This is the same rule that would apply to rate setting for emergency ambulance services. It would ensure that rates are reasonable and prevent insurance companies from shifting costs to local property taxpayers through below-cost reimbursements.

Funding for the State Rehabilitation Tax Credit
• Please ask your Senators to Support Amendment 17 filed by Senators Moore and Tarr. This amendment would increase the capitalization of the State Historic Tax Credit Fund from $50 million to $75 million, bolstering the adaptive reuse of historic buildings in communities across the state and providing an important piece of project financing for many rehabilitative developments.

Closing the Online Room Reseller Tax Loophole
• Please ask your Senators to Support Amendment 23 filed by Senator Montigny to ensure equitable taxation of hotel rooms purchased through online room resellers. Because of a glaring loophole, when a hotel reservation is made through an online hotel room reseller, the tax that is collected is based on an artificially low room rate, not on the room rate that the consumer actually pays. This amendment would ensure that internet resellers cannot avoid collecting and submitting the full state and local room occupancy excise tax based on the actual room rate charged to the consumer. Eliminating this loophole will ensure a level playing field for all parties.

Closing the Vacation Rental Tax Loophole
• Please ask your Senators to Support Amendment 70 filed by Senator Wolf to modernize the room occupancy tax. This amendment would make the lodging excise applicable to short-term or seasonal lodging rentals in private homes or other similar accommodations. Such short-term rentals have become increasingly popular and common with the expansion of the sharing economy and the advent of online booking sites like Airbnb for such rooms. As with the room reseller issue, eliminating this glaring loophole will provide a level playing field in the lodging industry, and ensure that the existing room occupancy tax is fairly applied in all appropriate instances.

KEY BUDGET AMENDMENTS ON CAPITAL SPENDING PRIORITIES

Community Preservation Act Funding
During fiscal 2015, 156 cities and towns collected the local Community Preservation Act (CPA) surcharge and are eligible for state matching grants in fiscal 2016. The Division of Local Services (DLS) estimates that the balance in the state trust fund will be sufficient to provide a first round match of only 18 percent of the surcharge levied by each city and town. This would be the lowest state match in the program’s history.

• Please ask your Senators to Support Amendment 54 filed by Senator Creem and others and Amendments 1 and 65 filed by Senators Tarr and Hedlund that would dedicate a portion of any fiscal 2015 year-end state budget surplus, up to $25 million, to supplement the fiscal 2016 state match. The fiscal 2014 state match was supplemented by $25 million from the fiscal 2013 year-end surplus, and $11.4 million was made available last year from the fiscal 2014 surplus.

Please Call Your Senators Today on the Budget Amendments that Impact Your Community!

Thank You!

 

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Posted in Budgets, Legislature, Massachusetts Municipal Association

Bond sales

Posted on May 15, 2015 | Comments Off on Bond sales

This email came Wednesday from Mike Sullivan, but I was on trial at the time so I am only now catching up.  Read Mike’s email before looking at the PDF to make better sense of the PDF.  20150512-public safety & solar PV bond sales

 

Sale of Bonds for Public Safety and Solar Array

We opened the bids yesterday for the $18,700,000 of bonds authorized by the Special Town Meeting in March. We did well, although last week the bond market was reflecting rising interest rates, so it’s good we sold them quickly. The results were very confusing as the public safety issue was reduced to $16,375,000 and the Solar array issue was reduced to $610,000. The reason for the reduction in the public safety issue was that the low bid included about $1.8 million in premiums, so we used most of that premium to reduce the amount of bonds issued from $18 million to $16.375 million. The rest of the premium on this particular issue will be used to cover the cost of the bond issuance costs. As for the solar array issue, the cost estimates has gone down because of the falling prices for solar panels and, also, bond counsel wanted us to reflect the fact that we had already received $90,000 in grant funds from the state for this project. What really confuses this issue is that we then received a premium of about $89,000 on this issue, which is almost the same as the $90,000 reduction in the amount of bonds issued. After covering its share of the bond issuance cost, the remaining $80,000 will be used to pay a portion of the annual debt services costs for this issue or about $8,000 per year in premium amortization funds.

 

We received six bids, which was low and a bit of a surprise, considering the last bond sale we had. we received 11 bids. I think this reflected the uncertainty in the bond market this week. The low bidder was Janney Montgomery Scott LLC, Philadelphia PA. The interest rate on the public safety bonds (twenty years) was 3.055% and the interest rate on the solar array (ten years) was 2.015 for a combined interest rate of 3.033. These rates are below what we projected at the town meeting so we’re in good shape as far as not underestimating our borrowing costs. I’m scanning the debt schedules for the two projects, along with the bid results and sending them in a separate email.

 

Hopefully Georgia will make sense of all of this when she comes to the Selectmen’s meeting on the 19th.

 

Mike Sullivan

20150512-public safety & solar PV bond sales

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Posted in Budgets, Buildings, Energy Committee, Fire Department, Police Department

Senate budget gives us $6K more

Posted on May 12, 2015 | Comments Off on Senate budget gives us $6K more

The Senate Ways and Means Committee budget is out today, and gives Medfield $6,000 more than the House budget.

FY2016 Local Aid Estimates
All Municipal
FY2015 Cherry Sheet Estimate
FY2016 Governor’s Budget Proposal
FY2016 House Final Budget Proposal
FY2016 SWM Budget Proposal
FY2016 Conference Committee
Education:
Chapter 70
3,730,480,705
3,828,556,906
3,830,886,519
3,833,516,810
School Transportation
154,078
110,488
124,430
124,430
Charter Tuition Reimbursement
76,974,357
74,728,135
74,431,420
77,487,186
Smart Growth School Reimbursement
436,743
436,743
250,000
436,743
Offset Receipts:
School Choice Receiving Tuition
45,494,828
46,648,312
46,648,312
46,648,312
Sub-total, All Education Items:
3,853,540,711
3,950,480,584
3,952,340,681
3,958,213,481
General Government:
Unrestricted Gen Gov’t Aid
945,750,001
979,797,001
979,797,001
979,797,001
Local Sh of Racing Taxes
816,585
710,500
710,500
710,500
Regional Public Libraries
2,501,833
2,521,970
2,601,883
2,521,970
Urban Revitalization
1,286,806
1,286,306
1,286,306
1,286,306
Veterans Benefits
50,344,210
51,516,162
51,516,162
51,516,162
State Owned Land
26,770,000
26,770,000
26,770,000
26,770,000
Exemp: VBS and Elderly
24,416,788
24,673,163
24,673,163
24,673,163
Offset Receipts:
Public Libraries
9,000,000
8,826,300
8,847,300
9,000,000
Sub-Total, All General Government
1,060,886,223
1,096,101,402
1,096,202,315
1,096,275,102
Total Estimated Receipts
4,914,426,934
5,046,581,986
5,048,542,996
5,054,488,583
Although the School Lunch program is funded in both the FY2015 final budget and the FY2016 Governor’s, House Final and SWM budget proposals, we have removed the estimate from the cherry sheet as this program is an education offset that has no impact on the tax rate setting process.

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Posted in Budgets