Published in the December 21, 2017 edition.
By MARK SARDELLA
WAKEFIELD — The municipal budget season won’t get underway in earnest until early next year, but the Board of Selectmen got a preview of the town’s FY 2019 budget last week from Town Administrator Stephen P. Maio. By Maio’s admittedly conservative estimate, the town looks to be in good financial shape heading into the next fiscal year.
He first reviewed the town’s current fiscal position, noting that even after last month’s Regular Town Meeting expended some Free Cash, the town still has substantial reserves. There is $7.25 million in the Free Cash account, $3 million in the Stabilization Fund and $300,000 in the Reserve Fund.
In addition, the town has accumulated $12.5 million in its “Other Post-Employment Benefits” (OPEB) account. This fund is a hedge against the town’s long-term obligation for future retired town employee benefits, primarily in the area of health care.
The town has $1.1 million in water and sewer reserves, which Maio said was lower than it has been in the past. This fund is used to make repairs to the water and sewer systems.
He noted that its strong position in terms of reserves helps the town to get lower rates when borrowing money through bonding for large projects like the Galvin Middle School.
Maio said that he had asked the board to identify its budget priorities and he reviewed the list with board. Public safety was at the top of the list, along with the downtown revitalization project, roads and sidewalks, drainage, capital improvements (Public Safety Building and DPW Garage), business development, town website upgrades, recreational programs, recycling and senior tax relief.
Maio noted that most of the town’s debt for capital projects will be paid off in the coming years and he will be talking to the board about putting money into the Capital Projects account to fund some of the aforementioned needs.
Maio talked about anticipated revenues for FY 2019. He pegged revenues from tax levy at $69,967,383. He estimated state aid at $10.5 million. He projected money coming from the state School Building Authority to help pay bonds for the Dolbeare and Woodville Schools at $927,551.
Local receipts (excise tax, hotel tax, local meal tax, etc.) Maio estimated conservatively at $6.6 million. He put the Wakefield Municipal Gas & Light Department’s payment in lieu of taxes at $891,145. He projected using $1,233,000 in Free Cash or available funds against the FY 2019 budget. Maio estimated revenue from new growth at $1,000,000.
Total projected FY 2019 revenues came to $91,119,079.
Moving on to expenses, Maio estimated FY 2019 operating budgets at $60,732,000 by increasing them over this year by about 3.5 percent (4 percent for the School budget).
Fixed costs (insurance, etc.) Maio projected at $20,656,000, anticipating an increase in group health insurance costs.
Maio said that he increased the capital budget by 5 percent to $2,250,000. He estimated Debt Service at $2,843,000 and Town Meeting articles at $2,222,000.
The Overlay Account (funds used to pay tax abatements) was estimated at $600,000. State and County assessments (MBTA, Charter Schools, etc.) Maio estimated at $1,772,727 and Cherry Sheet Offsets at $39,000.
The total estimated expenses came to $91,114,727. With estimated revenues at $91,119,079, Maio said that at this very early stage it came out to a budget surplus of $4,352.
He stressed that this early point some of the estimated numbers used were of necessity unpredictable. He listed those budget uncertainties as State Aid, Health Insurance, School Priorities, Local Receipts, Snow and Ice, Walton School and Public Safety Building.
Selectman Tony Longo expressed concern that the list of budget priorities did not include addressing the water quality issues with Lake Quannapowitt.
Selectman Edward Dombroski was worried about the School Department budget, observing that if it once again comes in with an increase in excess of 4 percent, “it blows the whole budget.”
