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Town's budget task force weighs two expensive future votes

Discussion about override, AHS debt exclusion point to next year

Finances logoA couple of expensive votes loom in Arlington's future, and leaders charged with looking at the larger financial picture grappled Feb. 26 with the amounts of money involved, when to hold those votes and how to make the cases for each to the public.

The Budget and Revenue Task Force weighed scenarios about an override to support the town's structural deficit as well as a debt exclusion to help pay for a new or rebuilt Arlington High School. Participants did not vote on the matter, but the consensus of those who commented appeared to favor having both votes next year.

The amounts of money under discussion depend on the option considered. The overall increase in taxes could range from $766 to $1,377 a year.

The body, in existence for at least a decade and represented that Monday by 21 members, provided a framework for further discussion.

Structural deficit

After Deputy Town Manager Sandy Pooler provided an overview about where the town stands financially as it moves toward fiscal 2019, Town Manager Adam Chapdelaine sketched out the town's structural deficit. That built-in shortfall has been tracked at least since 2010 and was part of the conversation during the last town override, $6.49 million in 2011

Basically, a structural deficit means long-term revenue does not keep pace with costs. Those on both the town and school side have found economies since 2011 that has extended an original three-year pledge for no overrides for nine years, all the way to fiscal 2019

These factors are among those signaling to officials that finances cannot be stretched further without returning to the voters -- increases in school enrollment, higher school costs and the lack of new growth supporting the overall tax base. The end to the stretch is predicted to occur just as the need for another override collides with paying for a revamped Arlington High, estimated by some at $200 million.

The focus of the discussion about the next override was a sheet showing a series of scenarios predicting the economic impact of votes covering three-, four- and five-years. See all of the numbers here >> 

Note that the amount of the override, ranging from $5.5 million over three years to $11,315,000 over five, pushes off when the town's structural deficit again takes hold.

Next year's budget is for fiscal 2019, and official predict the next structural shortfall would be two years later. Add a successful $5.5 million override, and that provides a breather until fiscal 2023. Higher amounts under four- and five-year scenarios delay the red ink until fiscal 2024 and '25.

What would the impact of the three scenarios be on taxpayers?

Expected tax increases tied to override

Based on a single-family home valued at $655,000, here are the expected increases in a home owner's annual tax bill:

-- $5.5 million override: $373.24

-- $8,730,000 override: $592.43

-- $11,315,000 override: $787.85

AHS debt exclusion

So this covers options for an operating override, which would shore up expenses for Arlington's delivery of services to taxpayers. What about the costs for a revamped high school?

The process is not yet far enough along to know with any precision what that is, but Chapdelaine and others have floated $200 million.

The handout provided at the Budget & Revenue Task Force meeting Feb. 26 offers these numbers based on the impact of debt for the massive project:

AHS rebuild debt impact

In what years should these votes occur?

Selectman Dan Dunn prefers the same date for each, in 2019.

Chapdelaine said he is concerned about "the agony of defeat" on one measure. "Pain and blood will flow." he allowed that lots of people are worried about their mortgage payments. "What can people absorb?" he asked.

Charles Foskett, of the Finance Committee and Capitol Planning, echoed that. "Members of the public are not ATM machines," he said.

Cindy Starks, a member of the school Committee, said: "We owe it to everyone to go home and find out how much [money] we need .... What are that real numbers?"

School Committee Chairman Jeff Thielman said he would like to see a set of metric to determine what the right number for an override might be. He added" Tell voters what services we get" for the money.

Bill Hayner, a School Committee member, said that when senior citizens know how money will be spent, they will support an override.

"I don't know answer," said Paul Schlichtman, a School Committee member. "The town is changing radically ... we have parents coming in with pitchforks ... they want to know how to improve services?" 

Long Range Financial Projection (Feb. 7, 2018) 

Operating-override scenarios

Jan. 31, 2018: A second look at $161M town budget plan for next year

This news summary was published Wednesday, Feb. 28, 2018.

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