Coordinator FY15 budget report – 2/20/14

At this juncture in the budget process there is a lot of uncertainty.  The Pioneer School District and our Fire and Police Departments are all making requests for increases. Nobody has requested a significant reduction.

Revenue prelude to FY15

No out of ordinary revenue is anticipated. In the past, revenue has included unrestricted grant revenue, disaster relief from FEMA and MEMA and more generous free cash balance.  Free Cash is the rolled over balance from the year prior to the current one.  It consists of revenue in excess of what was anticipated and un-expended appropriations. As of today we don’t know what free cash will be. My best informed guess is $70k and that is what I am modeling. Last year free cash was $135k. Year before was $60k. We used grant money to fund almost all of the new highway truck that is on order. And we have been informed verbally that our $480k Mass Highways grant request for paving the north half of Winchester Rd has been approved.  Senator Rosenberg is including $3.2 M in the current state bond bill for completion of the remainder of Orange Road’s reconstruction. We are running this winter with three not four full time highway workers which savings will be allocated to the snow and ice account.

Operating Expense

Highways and Schools are the bulk Warwick’s budget.  The Pioneer District negotiated new contracts last year that are in force. The district will need more funding to avoid cuts because wage lines are up. We need to figure how much of a school increase we can sustain.

We are going to have a deficit from this season’s snow and ice spending that we have to fund in FY15.  How large is the only question. There are six weeks left in a typical winter and we are out of money.  Way things are going I’ll guess $40k.  I’ve modeled $25k as it will be offset by some regular wage savings.

The Police Department request is increased. This is to fund almost two times more patrol coverage, increase pay rates, and adds a number of line items.  The FD budget appears to be reduced but part of the reduction is that the Selectboard have requested that I model FD capital items requested as Town Meeting Articles to keep the funds accountable in a way that including them in the regular budget under strong chief law would not.

We need to recommend a rate of pay increase. I suggest 1.5% which is what the FRCOG decided on. The retirement board is giving 3% but they look at their revenue side more than the cost of living. My opinion is that zero would be inappropriate in the context of the school district’s raises.

Last year we had total appropriations for schools of $915k. This included operating and capital. For highways $632k was authorized including Chapter 90 (the expended number is moving upward on snow/ice costs with each storm).  Fire spending was $33k and for FY15 $72k is proposed while police was $40k and $68k is proposed in FY15.

Capital Expenses

Library requests $10k to accomplish repairs to the entryway. Capital stab is modeled as funding source and they have a solid binding quotation to back it up.

New Fire truck – I recommend waiting until we have a station it will fit into. I think the truck proposed is too large for our roads and volunteer drivers. Chief has spoken of a lease. I modeled borrowing at 1% instead, saving at least $4k per year. Selectboard may require a petition to place this before Annual Town Meeting.

Other fire articles include ladders, SCBA, and turn out gear. Funds for SCBA, (air packs), if appropriated, shouldn’t be expended until we reach the end date on the equipment being reconditioned or replaced which I understand is four years out.  

Tech School Roof – Whatever the fix or replacement decided upon by member towns, Warwick’s cost won’t exceed $2500 per year for the amortization period.

Warwick Community School Roof – Sadly it is a bit past time. Efforts to get financial assistance from the School Building Authority have to date failed. Our neighbor town Bernardston calculated it lower cost to do it themselves than to pay 30% share and have the State involved. Based on their actual costs and on our recent town hall roof replacement I think this can be done for about $135k with a 50 year roof. We should borrow $150k just in case. If the gym roof portion can be delayed it will give us more time to pursue performance contracting with the District. We won’t have an appetite to insulate the gym on top of a new roof.

Town meeting is May 5th.

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