Less than four months into fiscal year 2024, the Bedford Finance Committee on Thursday unanimously approved a 3.5 percent fiscal 2025 spending increase guideline for schools and municipal departments.
The guideline is about two months ahead of the traditional schedule.
“When we do this now, we know where we want to be when budgets come in,” said Finance Director David Castellarin. “But there are so many unknowables.”
There are also variables to consider such as the amount for reserves and contribution to offset future employment benefits, he noted.
Member Mark Bailey introduced the percentage, which replicates the number used in recent budget years. Committee chair Ben Thomas said the number makes sense because it approximates what the town receives in tax and other revenues. “If revenue was flatlining that would totally change my view of things.”
He called the percentage “reasonable,” and added that he would not support a higher rate of increase, which would be “living beyond our means.”
The “real proof,” he continued, “is to see how the budgets come back. If every budget comes back 4.5 or 5 percent, that’s telling us something. I don’t think that’s going to happen.”
Thomas also stressed the cumulative impact of a budget rise, since each year’s total becomes the base for future increases. “Everything we do compounds. I don’t like making fiscal tsunamis. I’m content with non-revolutionary changes.”
“There’s a balance,” observed member Abbie Seibert, “maintain a level of services and don’t tax any more than necessary. This becomes part of the historical trend.”
The guideline is preliminary, as various projections are based more on patterns than on specific prospects.
“I know there are a lot of moving parts,” Bailey said.
Thomas added, “We have to be prepared for everything without having perfect information on anything.”
Regarding projected revenues, Thomas said, “We always lean conservative. We don’t have a choice. Things happen – Covid came out of nowhere.”
Castellarin noted that one of the cellular phone carriers paying annual rent to the town for transmission from the top of a standpipe has withdrawn.
Member Karen Dunn asked about the area with the most uncertainty. Castellarin replied that to fill some positions, “we had to pay outside what was in the budget. You want to hire someone with experience and they want top dollar.”
Bailey asked about assumptions about inflation. Castellarin said key indicators are not only large line items such as fuel and utilities, but also specific items such as water and sewer pipe fittings.
There were seven committee members at Thursday’s meeting, and five of them have experienced no more than one budget cycle.
“Nothing here is a sacred cow,” said Thomas.
Added Dunn, also a senior member, “We have a whole bunch of new eyes on how to approach this.”