FY2012 Budget Ready with Debt/Tax Impact Projections

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Review of the town manager’s recommended FY2012 budget will end on Tuesday, March 22 when the Board of Selectmen is expected to vote their approval. Over the past few weeks, the budget has gone through several reviews and changes and the board has met multiple times, in some cases in joint sessions with the School and Appropriations Committee.

Beginning with an almost $900,000 deficit, the members of all three committees have worked with Town Manager Norman Khumalo to reach a balanced budget that is acceptable to the majority of stakeholders.

The FY2012 budget totals roughly $63 million dollars and represents a 3.2% increase over last year’s budget of $61.4 million dollars. In order to balance the budget, the full 2.5 percent Proposition 2 ½ increase was used, as well as one half of the $900,000 excess levy from the last two years when Hopkinton did not tax up to the levy allowed by Prop 2 ½.

At their March 8th meeting, the board reviewed the budget line by line and had questions on several of Khumalo’s recommendations. Khumalo presented a list of several budget items for discussion and the board ended up rejecting some and keeping others. At the end of the March 15th meeting, the board kept the following items in the FY2012 budget.

Youth Commission New Initiatives $3,000.00
Park/Recreation Maintenance of Fields $79,930.00
Fire Department Portable Radios $17,000.00
One Police Cruiser $30,000.00
Council on Aging Bus $58,000.00

Money for a West Main Street/School Street intersection study was taken out of the budget as well as money for town hall renovations. Selectmen also rejected a $30,000 request for new phones at Town Hall and money for MIS network cabling.

At their March 15th meeting, selectmen made further adjustments and voted to accept Khumalo’s request for a one week extension to the budget deadline to allow him to more time to review ongoing contract negotiations and to answer outstanding questions from the board.
The major components of the FY2012 recommended budget are as follows:

Total Local Education $32,957,721.00
Total Keefe Tech $501,253.00
Total Public Safety $4,125,143.38
Total General Govt. $2,066,912.33
Total Public Works $3,351,903.20
Total Health & Human Services $340,173.00
Total Culture & Recreation $355,432.00
Total Debt Service $5,992,203.75
Total Miscellaneous $8,882,563.00
Sewer Enterprise $1,038,220.49
Sewer Enterprise Debt $1,194,463.50
Total Water Enterprise $1,170,439.18
Total Water Enterprise Debt $504,230.68
Total Park/Recreation Enterprise $513,604.00
Total Recommended FY2012 Budget $62,994,263.31

Also discussed throughout the budget process were tax impacts; tax impacts of Prop 2 ½, tax impacts of projected new debt by project and the total debt impact from existing and projected new debt. The projected average single family tax impact for FY2012 from Prop 2 ½ alone is $7,643. Projections of Prop 2 ½ increases through 2022 show ever increasing numbers, ending at a projected tax impact for the average single family home in 2022 of $10,826. If Town Meeting votes to approve all requests for FY2012, the tax impact increases from $7,643 to $8,121 for the average single family home for 2012. Carried through to 2022, the average single family home tax will increase to $11,260 rather than the $10,826 from Prop 2 ½ alone.

When presented with the initial tax impacts, selectmen then asked for a breakdown by project, saying residents need to know the breakdown in order to make informed votes at Town Meeting in May.
Detailed debt impact graphs will be presented at the March 22 selectmen’s meeting.

Projects included in the debt impact projections are listed below:

Library $ 3M
DPW $12.6M
Elementary School $23.6M
Hopkins Renovations $1.4M
Major School Renovations $7.2M
Major School Renovation Plans $144K

Once approved by the Board of Selectmen, the FY2012 budget will move to the Appropriations Committee for their review and recommendations.