Thursday evening the committee met virtually with town Finance Director David Castellarin and reviewed preliminary revenue and expense projections for fiscal year 2023.
As expected, there are many variables, especially as some budget lines return to pre-pandemic patterns.
Committee Chair Steve Carluccio initially said he hopes the committee can arrive at a recommendation at its Dec. 9 meeting. Other members thought Dec. 16 might be a more realistic target. “If we want good, solid, fully-thought-out answers, give Dave the time he needs,” said member Ben Thomas.
The Finance Committee in recent years has advised town departments to limit budget increases to 2.5 percent. The guideline for the education budget has been 3.5 percent.
Castellarin told the committee that he already has calculated the impact of these percentages. Member Steve Steele encouraged the director to be deliberate: “Don’t feel pressure. This has to be very well thought out. It has to be defensible by us at town meeting.” The budget presented for town meeting approval is submitted by the Finance Committee.
Near the end of the discussion, committee member Elizabeth McClung suggested that the starting point for the fiscal 2023 guidelines could be 2 and 3 percent.
Among the more significant line items addressed were:
The reserve fund: The original fiscal 2022 amount was $2.9 million, including potential Covid-related school expenses. That was reduced to $2.3 million by Special Town Meeting. Members are ready to return to the $1 million standard amount, and some would cut it by another $500,000, which has been inserted to cover possible loss of state funding for the education of military dependents. The financial policy guideline for the reserve fund is one-half of one percent of the operating budget.
Other post-employment benefits (OPEB): The town’s long-term liability is millions of dollars, mainly for retirees’ health insurance premiums. For the past two budgets, the town has opted not to add to its OPEB fund, because of the pandemic’s priorities. Finance Committee members are ready to restore the contribution. Several years ago financial officials set up a formula for an annual contribution with an increase of 3.5 percent a year. The committee consensus was a $1 million placeholder for next year.
Stabilization fund: The $1.9 million added to the reserve was transferred from the stabilization fund, so it had no tax rate impact. The committee wants to restore the stabilization fund, but will wait to see the size of the town’s certified free cash since that could be the source of the funds. That total isn’t expected from the state Department of Revenue until at least the end of the month.
Mike Rosenberg can be reached at [email protected], or 781-983-1763