Officials endorse budget 'concept'
Published on March 28th, 2007
STONEHAM, MA - The town's Selectmen unanimously endorsed the "concepts" behind a five-year spending plan that would plug a predicted $3.8 million FY'08 deficit with a $3 million tax override.
The bold financial blueprint, pitched by rookie Selectman Paul Rotondi, will almost certainly cause a stir amongst Stoneham employees and their respective collective bargaining units, as the $800,000 budgeted for cost-of-living salary increases is not funded.
Specifically, the former School Committee member and Finance Board veteran contended that the town's unions will have to make a tough decisions during future contract talks: Find a way to fund your raises through existing funds or face the prospect of layoffs.
"Departments are responsible for whatever the negotiate for a salary increase. I have to be honest, it does not eliminate the possibility of future personnel cuts," Rotondi warned.
According to current estimates, the proposition 2 and 1/2 override, if passed, would cost the average taxpayer approximately $360 next year.
In return for the citizens' endorsement of the override, Stoneham would avert $3 million in budget reductions outlined in Town Administrator David Ragucci's spending plan for next year.
Under that forecast, when coupled with the School Committee's draft budget, five firefighters, three police officers, elementary-level music and art, all high school athletics, and the sixth grade wing at the middle school would all be eliminated next year.
Significant reductions would also occur at the local library, along with a relatively minor van driver reduction at the Senior Center - although Ragucci has indicated that transportation service would be restored through outside funding.
However, according to the Selectman, his proposal would not only eliminate the current $160 trash fee - meaning residents would actually see a net $200 jump in costs - but it would come with an explicit promise from town officials that another override or trash fee would not be sought between now and 2011.
"I was expecting that the Board of Selectmen would accept this tonight and that [approval] is conditioned on the other boards accepting it," Rotondi indicated. "I'll take that pledge, as long as I'm a Selectman, I'll never vote for a trash fee, and I'll never vote for an override."
"You can spin the numbers anyway you want, but we have no other choice. Quite frankly, I won't agree to anything more than $3 million for an override because I don't think the taxpayers can pay for it," the first-term Selectman furthered.
Although the Selectmen later backed the "concept" of Rotondi's five-year plan, the vote was largely symbolic, as an override was not formally placed on an election ballot. In addition, some board members appeared concerned with several spending conditions and limits contained in the proposal, although it's unclear as to whether the Selectmen will attempt to tweak those aspects.
Without specifically lobbying against any particular facet of the proposal, the Selectmen, in unanimously accepting the "concept", directed Ragucci to work the numbers to see what would be restored to the budget - although Rotondi made it clear that every proposed program and personnel reduction on the municipal and school sides would be restored.
"I'm thinking at this point, we should make it a point to endorse the plan. Then Mr. Ragucci could go back and work out the details," explained Selectman Tony Kennedy.
A tough line on expenditures
According to the basic proposal, all three of the town's major boards, including the Selectmen, School Committee, and Finance Board, would have to endorse the entirety of the plan.
Arguing that no citizen will even consider passing a tax increase unless they are sure that the town can do something to address a structural budget deficit over the long-term, Rotondi and Finance Board Richard Gregorio suggested that future budgets would have to reign-in costs.
Specifically, the blueprint will hold the entire municipal budget to an overall 2.5 percent increase every year, meaning that the town government could only raise operational expenses by that limit.
Any new revenues, above a budgeted $300,000 jump in new growth, would be split according to a 40-40-20 split, with an equal percentage going to the municipal and school sectors and the lower portion going directly into the stabilization fund.
One-time revenues, such as funds raised through building permit fees from a large scale project, would be slated for the stabilization account only.
A major facet of the proposal, any new annual revenues above $300,000, such as more local aid, or taxes raised through a major redevelopment, could only be slated towards operational costs.
In other words, while the funds could pay for new employees, programs, or additional services, not a dime of those moneys could be directed towards cost-of-living raises sought by town employees.
According to Rotondi, an annual personnel budget increase of 2.5 percent will be available for all salary-related items, including negotiated step, health insurance, and cost-of-living increases.
If workers want to negotiate a raise above that level, and can not fund it by making health insurance concessions or saving money through retirements, then they will shoulder the full responsibility for any layoffs that result, the Selectmen said.
"So you have information that we're ready to sign contracts without any increases?" Selectman John DePinto challenged.
"That's not what I'm saying. You get so much for raises and you have to make that within your budget," Rotondi responded. "I'm trying to force the departments to restructure. Quite frankly, if that's they way you're going to pay for your salary increases, then you're going to get everybody's cooperation."
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