Hello everybody. Welcome to the Cadam Finance Committee meeting in January 27. >> We're live. We're live people. Uh pursuant to Governor Healey's March 28-25
signing of chapter two of the acts of 25 extending certain CO 19 measures adopted during the state of emergency suspending certain provisions of the open meeting law. This meeting of the gadam finance committee is being conducted in person and via remote participation. Every effort will be made to ensure the
public can adequately access the proceedings as provided for in the order. Reminder that persons who would like to listen to this meeting while in progress may do so by calling 508-945-4410. Again, 945-4410 and enter conference ID 516
530-665 hashtag 516-530-665 or one may join the meeting online via Microsoft Teams. Post a record of this meeting on the town's website as soon as possible. So, we are going to begin to get our
finance committee muscles back in shape after a little time off. Uh, and we're going to state start with a budget overview uh presented by both our town manager and our town finance director. So, with that, I'll turn it over to you ladies.
>> Oh, god. Yeah, muscles. Exactly. My apologies to the general public. Uh, John Papalardo >> here. >> Christristen Andres >> here. Andy Young >> here, >> Tommy Don >> here, >> or Madison >> here, >> chairman is here, and Joannne Sprag and
Tracy Shields are and Eric Whitley are absent with excuses. So, let's begin. Over to you guys. >> Thank you, Mr. Chair. I'm Joel Goldmith, your town manager, and welcome to budget season, my favorite time of the year.
This budget reflects months of work by my team led by Director of Finance Carrie Maserol in close collaboration with the department heads. So, in accordance with our town bylaw and charter, I respectfully submit the town manager's preliminary FY2027
operating and capital budgets for your consideration. We're proud to present the navigating the fiscal year ahead budget focused on preserving core municipal services at less than a 5% increase. It's
deliberately lean level serviced and focused on long-term stability. Budgets reflect priorities. The FY2027 budget aligns with the community goals and select board direction with an updated vision statement reflecting
input from our latest select board member and the added the added language that was voted on January 6 is promotion of a healthy economy encouraging yearround employment using Chadam and Cape Cod citizens.
In 2024, the select board identified goal categories to move forward on initiatives that align with the vision statement. A more robust description is included in your budget book and on the town's website under the select board page
with review. Earlier this month, the board the board voted on added objectives for this category which reads it's a goal respond effectively to the needs of a diverse, welcoming, safe, healthy, and livable Chadam. They also
added a few more objectives under that goal category that are listed here for your review. Um the last one, as you see, is provide a civics 101 class for Chattam residents. Um, in addition to the new Cadam Municipal Academy for which the
chair participated this year, an ADIB objective was also included in the educational excellence goal category. Uh, encourage students to serve the community and schools through civic engagement. So, I'll now turn this
over to Carrie, our director of finance, to continue with the presentation. >> Thank you, Joe. Good afternoon everyone. >> Hello. >> Um so I'll just go over um the state of the town. Um I did present this during
the budget summit, but I'll go over it again. Um the town valuation is at its highest to date, 12 bill869,437,800. That's an increase of 4.28% from FY2025 valuation. Um
the tax rate is $3.67 which was an increase of um 20 cents from FY2025 and we are re reaffirmed our triple bond rating as of April 23rd 2025. Reserves are stable and comply with fiscal
policies. The average residential value is1,642,816 and the average single family value is uh 1,735,456. I'm going to kind of um on the millions I'm just going to keep it short and say like 1.7 just to
so I don't get tongue tied while I'm going through everything. town budgetary components. So, we'll go over our budget highlights, um the revenue outlook for FY2027, our expenditures, which include the general operating budget, educational assessments, the
water operating budget, our five-year capital plan, and we'll also go over other capital and community priority items. Just like last year, we're using the um Clear Gov digital budget book. Um the digital budget book has budget narratives, budget statements, prior
year accomplishments, organizational charts, staffing history, and the 2027 capital improvement plan requests and inventory. So, I'm just going to show you the digital budget book. It's changed a little bit this year compared to last
year. Um, so when you view it online, um, there's this little button down here that you can click on and it will go through each of the sections for you. Um, or you can just grab this little toggle over here
and you can pick on like select department summary and then you can select which one you want to look at. We'll put pick natural resources and each one will have a statement on the front, some nice pictures that we added
this year. Um expenses by object. So you'll have you see um actuals and then you'll see um for 23, 24, and 25 are actuals. And then you have 26 and 27 which is um the budgeted amounts. And then if you dive deeper into it, you can
click the little toggle again and you can click each department and go through each department and you'll have budget statements, staffing numbers. You'll see the prior year accomplishments. Um this is an added section right here of departmental goals. Um and then the
expenditure summaries um by object. Um, and you can get you can see each one right here individual line items all the way down the comparison between 26 and
27. So that's for every department. Go back to the slideshow. So, the 2027 budget highlights um the proposed budget for 2027 shows an increase of 4.79% over 2026, an operating budget of 47.3 million with
no new positions. The capital plan is presented at 2,49 or 40 4.9% of our operating budget which is within our 9% um of our financial management policy and no use of the tax
levy. Revenue outlook. This chart shows the percentage of revenues per category. As shown, the largest contributor of the budget is our property tax at 64%. Local receipts at 15%
other revenue fund other available funds sorry at 14%. Uh the water budget is at 7% and state revenue um at 0%. As this is a small percentage of revenues received. >> Carrie, could you just edify us please
on the nature of the available funds? >> Uh yep. I'll get I have um some other slides that go over each of these items I'll go over. >> Great. >> So, first I'll go over the property taxes as this is an estimate of the
FY2027. Property taxes represents approximately twothirds of the town's overall revenue. The estimate for FY2027 is 48.7 million. for uh for FY 2026. Again, the assessed
valuation of the town is 12.8 billion. The average residential value is 1.6 million and the average single family home is 1.7 million. >> Carrie, >> yes. >> The previous slide. >> Yes.
>> The lower left >> excess levy negative 717. Is that just to balance that? >> That's the balance that will be left. >> Okay. Thank you. >> Y >> Carrie, what's new growth?
>> New growth is um any new properties that were built in town, additions, um properties. Um what else? I feel like that's kind of
it. It's not It doesn't What? Oh. building permits. >> So that suggests that only $375,000 new property, new construction was added in the whole of last year. >> No, no, no. This is an estimate. So I
estimate lower. Usually um so last year I think we had new growth around 403. It wasn't much more than what this is. Yeah. >> Wow. >> Yeah. >> Yeah. And I think the year before it was a little bit less than that. is the tax revenue from that new growth, not the
actual cost. >> Okay, John. >> Okay. >> All right. Thanks, Andy. Thanks, Carrie. >> You're welcome. >> Um, so local receipts are estimated um at 89% of the prior year actuals from 2025,
11,681,22. Again, that's 15% of the town's revenue. This includes meal tax, short and short short-term and traditional lodging, departmental fees, service charges, interest, um ambulance fees and such. And then we have other available funds
which is uh 10.6 million at 14% of the town's revenue. Um 1.4 million will support the operating budget roughly. Um receipts reserved for appropriations. There's free cash and community preservation funds.
Um others include um PEG access would be a receipts reserved for appropriation. Um waterways uh user fees is a receipts reserved for appropriation. Conservation funds um
I think that's kind of it. There might be another one not thinking of um oh Cape Coden Islands uh water protection fund. We use that. It's on this slide. Carrie, could you just briefly explain the thinking behind moving the estimated local receipts to
89%. Was do we historically other than the during the pandemic run 80 to 85? >> So we used to do uh yeah so it was around 85% and we've bumped it up. Last year we did 88% and this year 89%.
Just to help out with the budget with the increases. >> Okay. Thank you. >> You're welcome. So some other available funds we have our revolving funds which we use um recreation revolving um those uh receive program costs and we pay items out of
there. We play um part-time people uh seasonal people out of the um recreation revolving and then we also have the shellfish revolving. Um, we received chapter 90 funds for uh highway um roads
and sidewalks and such. Um, again, I just mentioned this Cape Cod and the Islands Water Protection Fund. We receive 615,000 each year and that's to support our debt service. Um, and then we have the waterways user fees and the balance as of um December 31st was 1.4
million in that fund. So, just to go over the um uh short-term and traditional lodging and meals tax revenues um currently. So, this graph um is going over the past six years. Um at
the end of 2025, the hotel motel revenue collected was 3.9 million and the meals tax collected was 695,000. The revenue has been consistent over the past few years with a slight drop in 24 and 25. Obviously, tracking and monitoring local
receipts for trends is important when building a budget because you can see the growth from 2020 during the co during the pandemic and now in 2025 expenditures.
This is an overview of the 2025 sorry 2027 preliminary budget. The town operating budget is at 47.3 million. The school assessments are at 12.5 million and as of now we've have only
received a preliminary budget from the Monoy Regional School and we're still awaiting the budget numbers from Cape Cod Tech. Um the water budget is at 5.7 million and again the capital plan is at 2.4
and those are for the items that cost between 10 and $250,000. This is a breakdown the percentages of the departments for FY2027. Um you'll see more of this in detail in your budget book or online. Um
the largest contributors will be our sorry the employee benefits at 12% uh public works at 13% debt service at 14% public safety at 15% and then we have education which is at 19% of the budget.
This also includes the water department. So, they're in here and they're at 8%. This provides a comparison of the FY2027 proposed budget to the FY2026 budget. As you can see, the total proposed budget for 2027 plus education is 59.9
compared to 56.88, 8, which is a 5.37% increase. And the operating budget minus the education assessments is at 4.79. These are the major operational factors we are seeing which I'll go over in
another slide. um salaries, contractual obligations, utilities, employee benefits, insurance premiums, debt and education assessments. The proposed 2027 budget reflects a commitment to maintaining essential services and meeting our financial
obligation. The primary drivers of this year's budget increases are salaries, employee benefits, debt service, and rising costs to utilities, and general liability insurance. The personal wages and benefits represents approximately 70.82% of the
town's operating budget, excluding debt, service, and education. increases are required for personnel services um including overtime amounting to $893,000
or 4.87% over FY2026. A contributing factor to all budget increases is labor cost pressures due to limited regional labor market and compensating employees at a liveable wage to stay. So, as you'll see here, um our employ
benefits are increasing 529,000 over last year which is due to um the increase in healthcare Medicare was increased in on January 19% and the u projected increase for health
insurance is roughly around 10 to 12%. Um we haven't received those that information yet from Cape Cod Municipal Health Group. We'll be receiving it probably in midFebruary in the next few weeks. So this is resulting in benefits
increasing 14.6%. We also have increased costs for software at 12.5%. And increased for insurance premiums at uh 12.6%. Utilities um last year um those
increased significantly. So um this is putting pressure on the town. So we've increased this 25.5% over 20 26 >> and Carrie with respect to the IT purchase of services
>> uh is that the new financial management software or ordinary course of business stuff? >> Ordinary course of business stuff. >> Okay. >> Carrie, is that insurance all um employee health insurance or does that is that the insurance for buildings and
things like that? >> Yep. The insurance line is our general liability insurance. So that includes our buildings, auto um auto insurance. Um and we have other different little items in the insurance that we pay for
uh flood insurance. Um cyber security insurance. >> Does that figure include a provision for the 90 Bridge Street project? >> So yes. Yeah, >> good >> Tommy.
>> Thank you. Just in the uh utilities though, how many of the town buildings have solar panels? >> It's a good question. How many have solar panels? Is it just Does this building have solar panels? Annex,
police, >> fire, >> fire. Um, we do receive we are part of a program where we do receive solar credits, but they don't they go into a pilot in the in for our local receipts.
It's it's a pilot payment that we receive money for. You're welcome, >> Andy. Gary, the um I'm sure I missed the headline somewhere, but >> the increase in Medicare of 19%. Mhm.
>> That's what we're being charged for employee on our employee payroll. >> No, that is the cost of the insurance for retirees. So, if they're on Medicare, then the increase for their health
insurance was 19%. >> So, it's not Medicare per se, it's the excess or the supplemental, >> right? >> Okay. Yeah, it's not. Yeah, Medicare in for employees is standard. That hasn't
changed. >> Okay. >> Right. So, the the Kai Municipal Health or Baral Municipal Health Group. >> Yep. >> That's like >> That's a lot. >> Just
>> It's a lot. I know. >> It is. >> Mhm. >> Yeah. Okay. Thank you, >> Carrie. That's for retirees. Does that somehow land in OPED calculation or >> Yes, it does land in the OPEC calculation. >> Okay. >> Y
>> thank you. >> So this is um general fund existing debt service as of uh June 30th, 2025 five. Um, just keeping in mind that we still have approved projects that we still are working on, uh, that were approved at
town meeting for borrowing. So, um, for FY227, it's 8.8 million. I'll get into another slide for you, John. You're welcome. Um again, this is um the 2027 school
assessments that they're just preliminary as of right now. Um the school committee on January 15th uh voted um the Modoy school budget at 52.7 million which is a 3.46 million uh over
2026. This amounts to Chadam statutory preliminary assessment at 11.9 million which is a 7.7% 7.74% increase from FY2026. This includes uh capital and Chadam
elementary school assessment which is uh 2.32 million. And as of right now I'm estimating a 5% increase for Cape Cod Tech School based on prior years. Um but at this time I don't have any further information.
We'll have more information in the coming weeks. Um the final vote from the school committee is uh February 26, 2026. Um I do know that the Cape Cod Tech has 19 students right now. So
Carrie, two questions if I might. Um, is there still any momentum behind Haritch wanting to tinker again with the MRSD formula? >> Um,
so there has been talk, but um that's just about all I know. We haven't actually met on anything to change. >> And the last engagement would have been what? When Jeff and Mike Shell went over and had a chat with their their crew? >> Yes. Okay, that turned out well. Um,
when did we assume carriage of Chattam Elementary School? Is that four years ago at this point? >> It was in um Hold on one second. >> Before your presence, >> I have it. I think it's over here.
Um, >> I'm I'm asking because I think at the time, and correct me if I'm wrong, I think we were looking at um >> it was in 2023 when the town So, they voted it in 2022 and the town pays their own Chadam pays the Chattam Elementary School in 2023.
>> And that first year was roughly what? 800,000 or so? >> 9. So, it was 8.5 in 2022 and it was uh 9.5 in 202. >> No, but I'm just thinking the co the cost of Chattam Elementary. >> Oh. assumed what four years ago now it
was >> um >> 750 $800,000 roughly and now we're up to almost 2.5 million. >> Yeah, I believe it was like 800 and something thousand. >> Yeah, that's what my memory is. >> Mhm. I think I >> So it's gone up 300% in three years,
four years. >> Yeah, >> I think it might be in here, >> but I believe it was around 800 and something thousand. >> Yeah. Well, I think that's that's good. That's close enough. just order of magnitude. It's sort of >> okay >> a remarkable increase over that period of time.
>> Thank you, Barbara. >> Does that include that number, that $2 million number? Does that include any capital improvements we've done to the building? >> So, they have like small capital items that they include, but um yes, it it also includes the debt service that
we've approved as well, the assessment, if that if that's what you're asking. So, um the uh they're going to have an article this year for the roof for the middle school and the windows and siding is included in their assessment,
>> but that's not CH C Chadam Elementary. >> Yeah, >> that's not Chadam. No, that's the middle school. Chadam Elementary. They might have some smaller capital items in there. >> So, nothing that would account for the huge um increase. What What does account for that? Do we
know? a lot of um special education costs have increased. >> Um I think they're also they're they are still waiting on the governor's um budget to get approved. Um so it this
could be reduced in the next uh couple weeks as well once they receive their state aid numbers. So to see what they get for chapter 70 and the circuit breaker and stuff like that. But um they'll be presenting to you guys
I believe um February 12th. >> Carrie, has the number of kids gone up in the elementary school? That I don't know. I don't We can get you that information.
I just kind of want to hone in on why it's such a huge increase over such a short period of time. Yep. Yep. Yeah. We can get you more information on this, but um they'll be presenting on the 12th, but if you have questions that
you want specific answers to, um you can send them over to me, too. That way, Michael is prepared when he comes to present the budget. Um, so this slide just goes over kind of the same information that we just talked about. Um, they'll present to the select
board on February 24th. I believe I have them on the schedule for you guys for the 12th. Um, the original agreement, there's no proposed changes as of this as of right now. Overall proposed budget for the school has increased 7.04%.
Um and Chadam's assessment increased 7.74% or 860,000 over FY2026. Um there's going to be an additional borrowing to replace the roof on the middle school and their final vote for
the school committee is March 2026. Um I did just show this slide a little bit. Um but you can just see um the growth of the Monamorei Regional School District over the past few years. So in 2022 it was 8.5 million and now we're up
to 11.9 million. >> So interestingly the rate of growth at Chattam Elementary is six times roughly what it is in admir. >> Mhm. >> Yeah. I Barbara, I think we should try
to understand that number a little better. >> Okay. >> I do have um I did receive some budget information from Michael and I can forward you that once I get it um get back to the office. I can send you that information
>> at your convenience. That'd be great. >> We'll drill down a little bit more on the numbers for you. >> Cool. Thanks. >> You're welcome. Um so this slide goes over Cape Cod uh regional technical high schools assessments. Um in 2023
um as you can see it's gone from 355,000 up to um an estimate of 617,000. Um, and um, of course in 2025 it we bumped up to 20 students and now there's 19 students. Um, I can't remember what
there were when there was $355,000. How many students there were? >> Do you remember? >> Single digit roughly. >> Five or something like that. >> 567 something that order magnitude. >> Um, this goes over the water department budget. It's an increase of 4.68%
compared to FY2026. Um, we've got salaries at 304,000. Uh, regular operating expenses at 2.4, indirect costs paid to the general fund at 353,000,
and we have debt service at 2.5. Um, this is uh the water department's existing debt service. Uh so for 2027 we're at 2.5 and it goes all the way up until 2032 on this slide. So this is an added slide I added
to go over our authorized and unissued debt. Um so as of June 30th 2025 the general fund authorized debt was at um 118 million. The water fund authorized debt was at 34
million. We have unissued debt at 43 million which is approved for projects which we haven't borrowed for yet. So the general fund has 40 million and the water fund at 2.2.
Um this year um I have going to be writing an article for to resend some debt at town meeting. They're for some older projects. um general fund is uh article 10 from 2006 for 659,000
and then there's article 14 from 2009. That's a combination of the two. And then there's the water fund um for an article 13 from 2012 for 478,000. And Carrie, just for clarification, is
the bulk of the authorized but unissued at roughly 41 million predominantly sewer related? >> Yes. So that general fund one is predominantly the $32 million one that was approved last year.
>> Yeah. And we you're not seeking a >> an additional We still on the two-year cycle. >> We are still on the two-year cycle. >> Okay. Thank you. Yep. You're welcome. It's not all the detail that you'd probably like, but it's something.
Um, so this goes over our debt um equalized valuation. So, um, again, this is a two-year, this gets done every two years. So, this is from 2024. Um and the equalized valuation in 2024
was 12 bill659,22,000 which is 5% at 632,951,100. We have a net debt subject to limit at 161,89,000 and the total available debt limit is $471,142,81. And this this chart actually kind of
goes over a little bit what I just went over for you and um the calculation and how it gets there. Andy, please >> carry the debt outside line. >> The debt outside is the water debt. >> Ah, thank you.
>> It gets subtracted because it's not part of this calculation. >> That wonder. >> Yeah, >> it was kind of non-specific. >> Yeah. >> Other capital and community priority items. So, we're going to go over the FY2027
capital plan between 10 and 250,000. Um, the amount of requests for 2027 is 11.5 million. This includes all capital including warrant articles. Um,
we're recommending for this at 2.49 million using free cash in the amount of 2.26 million which is 4.89% 89% of the operating budget net of debt. Any larger items over 250,000 will be
considered for separate articles. So this slide shows the capital plan approved for um 2026 as well as the requests summary for FY 2027 um and recommendation totals. And as we move through the budget, some
of these might change a little bit. And you can see the other funding sources that we're using. Uh free cash at 2.2, waterways improvement funds at 115. We are not using cemetery sale of lots because they didn't put anything forward
this year. Um PEG access fund at 30,000. We have prior year articles at 73,000, conservation fund at 10,000. Same information I just went over and um some other potential capital
articles that are pending review. Um, let's see. We have dredging which will be using the tax levy at 400,000. That's an annual um article. And then we have a uh a couple of borrowing accounts that will um
borrowing projects that will be put forward uh by natural resources. We've got Barnhill Landing Bulkhead improvements at 2 million. Then there's Ryder's Cove Landing improvements for another borrowing at 3.5 million.
Um then there's the Center for Active Living. Uh this is a capital exclusion and it will also be using some other funds such as free cash and um prior year articles and that's roughly around 1.8 million. Um and then we have the
financial management software uh using free cash at 400,000. I did apply for a grant. Um I probably won't hear back until after we set the budget. Um and then the child care voucher program using the tax levy. This is another um
annual article and this is at 200,000. >> So Carrie, another two questions, please. >> Um I think for the sake of clarity, >> isn't the Barnhill Landing Bulkhead U kind of repair and maintenance as opposed to improvement?
Is that more appropriately characterized is that given that it's partially collapsed? >> Uh yeah, probably if it's >> Yeah. I just think it's important for the taxpayers to know it's seems to be more of that than >> an improvement. >> Okay. I know that um Greg is going to be
presenting um tonight and he'll be presented to you guys on Thursday, but I can definitely get you. >> Yeah, we'll tune in. >> Yeah. Um and then just a question I I'm familiar of course where we landed on the sefell
um with the working group and kind of recommendations that it made. >> Is there a benefit or a point to kind of overfunding the recapital borrowing for that project so we don't find ourselves six months from now another $200,000
short or something like that? That might be a good idea to make sure there's enough contingent. >> Doesn't have to be doesn't have to be spent presumably. You can just resend it >> the following year, but it'll be a shame to have go through this whole exercise. >> So, come up short again. >> With this one, it's a capital exclusion.
So, um it's different than a borrowing. So, there will be nothing to res resend because a capital exclusion just goes on the tax rate for one year. >> Yep. >> And then that's it. So, >> okay. Well, again, I just I it would be
a shame if we missed by $50,000 or $100,000 and have to take this thing back another year, >> right? >> So, Mr. Chair, for town meeting, we're hoping to have our bids in hand so that when we go to town meeting, we know that's probably the highest amount that
we would need. And as you know, the budget includes all sorts of contingencies for >> right >> everything basically. So, um, but Carrie's right. It's it's it's a one-year increase to the tax rate in tax bill. >> And if the bids and hand come in again
slightly higher than anticipated, we could tweak the article presumably. >> So, we need to have the exact amount on the for the ballot question. >> Yep. >> To be approved. We can't just have a it. So, when you
have a ballot question for a borrowing, usually there's no dollar amount associated with it. But with a capital exclusion, you need to have a dollar amount associated with it. >> Okay. Tommy, please. >> Thank you, Mr. Chairman. In the financial management software,
what does that usually run every year? So, we're buying new software. Um, like uh it was presented last year that we needed the town needed new software because our software is 20 years old. Um, so it doesn't typically cost this
amount of money. This is just because we're getting new software. Um, so roughly our contract is around $60,000 for our old for the system that we're currently currently using. Um, we're going to be going with um Tyler
Services, which is widely used in Massachusetts. Um, and it would probably cost us a little bit more, probably 100,000, maybe 125 versus the 60,000. >> So, how long does that software usually
good for? >> Well, Tyler Services will be good for a very long time. They actually um they're more current, up to-date. They're the largest um company that I know of for uh municipal
software. They're always making upgrades. They're always adding FE features. Um they're definitely the number one software company for um municipal accounting, tax, utilities. So,
>> thank you. >> You're welcome, >> John. Please. >> Thanks. Um with respect to the RERS's Cove uh item up there, are we have we exhausted all of the funds that were in that water ways or waterfront?
>> So there's um No, they uh there's still 1.6 million left to borrow on the original borrowing >> and six. >> And would that project also be eligible to use waterways user fees dollars?
Um, it could. >> Yeah. And >> you'd have to appropriate it at town meeting, >> right? And the 35, is that inclusive of the 1.6? So, is this above and beyond the money that we we currently have authorized?
This is an additional three and a half. >> Yes. >> So, that's that's a for sake of clarity, that's a $5.1 million project effectively. Yeah, it could be. I know he'll pro he'll be use reusing some of
that for. Yeah. Okay, let me move on. Some more uh articles. We have the floor treatment re renovations which we'll be using free cash475,000
and this is for um the community center flooring that has um this has been presented um in the capital plan since 2019. Um and then it also includes extra funding for the town hall flooring and
um the police dispatch center in their little area over there. Um there is a um borrowing for the water department for um I'm sorry there is it's on there for the
water storage tanks painting um at 2.3. This one up here, the sewer capital transfer from water capital stabilization for two million is for um an article that was approved in 2017
um for um phases 1 C and 1D. And this is for um expenses that have incurred above and beyond what the article has been approved for. And in the article, it was written that the offset
would be from um the wastewater capital stabilization fund. So that's what this kind of article is going over. Um we have the other postemployment B benefits OPED. This is a a normal article, annual
article that we usually have. Um, but this year we'll be using free cash instead of the overlay. Um, at $150,000. Um, there will be an article for stabilization which is going to be using free cash and reappropriate an old
article that was actually written using the stabilization fund. So, we're going to put it back into the stabilization fund. and this is at 350,000 and this is to stay in compliance with our financial policies. Um
there is going to be presented a grant match fund using free cash in the amount of 50,000 and that is to um make sure that the town has some way if a department was to go for a grant and apply for a grant and it was a matching
grant that we have funds there that we can utilize instead of having to wait to go to town meeting and get appropriated. the funds will be there and this fund um will just be like a normal article that gets it can get funded each year as we
need it. Um >> Carrie, hold on. Uh Andy, please. >> Couple of questions, Carrie. First one has to do with the um OPED. >> Yep. Um, considering the significant increase in the Medicare
cost in previous slides, is that going to change this >> this funding right here? >> No. Is it going to change the an appropriate calculation for the OPE amount? >> So, we just got our OPE analysis
um that was done. It's done every two years and we just got it back and it actually went down. It was at like 16 million and now it's down to 10 million. >> Did that incorporate the 19% increase in Medicare?
>> I I don't think so because it was probably evaluated before that 19% was was done. >> Right. So I mean I I just it's that would be one of the interactions that >> Yeah. >> So OPIP PB does fluctuate.
So it's based on market trends too. But my second question has to do with the uh fund overlay account. Um this is at least part of the expense of going to residential
um >> tax exemption. >> Tax exemption. And you know what was the other amount coming from? >> Oh, on the bottom. >> Yeah. So, this right here, the to fund the overlay on the free cash at 500,000, that's to
fund the real estate exemption. Yep. >> Right. >> Um the other portion is going to be coming from the balance of overlay. >> Okay. And now it's currently estimated at >> it has a balance of around 970,000 somewhere around there.
>> Okay. So, roughly a million4 to a million5. >> We want to make sure that's in there. That's based on the 60% participation, right? >> Yep. >> Okay. If we fall below that, then the overlay is going to be higher. >> Correct. >> Okay.
>> Thanks. I knew it was real money. I just >> It's real money. Yeah, it it does. It >> um >> Yeah, it it definitely affects things differently. >> Thank you. >> You wouldn't think of >> Not including any prospective personnel costs.
Oh, yeah. Uh part-time uh temporary person. >> Yep. >> Barbara, please. >> Thanks, Carrie. Um those old articles that you're going to ask to be rescended, where do those funds go? >> Which ones? The borrowing?
>> The Yes. >> So, those just get resended. Rescended and they just fall off our um our report. >> Rejected borrow. >> Yeah. Yeah. >> Are those those aren't anything that's likely to come up again, are they? >> So, I did write them down because somebody in the select board meeting had
asked me what the articles were and I didn't I didn't write them down. So, article 10 from 2006 is a well and pump station. It these are too old. We can't even if we incurred costs for these, I can't I can't get the money from from them
because they're just too old. >> They don't let you borrow after a certain amount of time, unfortunately. um they assume that the project has already been done. Um and then there's article 14 which is 2009 is a police water treatment project and then article
13 from 2012 was for water manes. Okay. >> So we could eventually go back to borrow for these but we just we can't use these funds anymore. Okay. Thanks. You're welcome. >> I think the grant matching fund is a very prudent idea.
same. Um, and then there's a couple others on there. We have an airport article uh for FY2026 using free cash in for $17,600. Another article for the airport using free cash for $7,000. And these are the
towns uh portion of the grant for their match that they need to in order to support the grants that they get that they receive from the federal government. And then you have um the PEG access cable funds at uh 76,458
and this is to uh go to um Cape Media and we had that article last year. We received the funds in the town and then they go back this portion is theirs. So um the balance of free cash so we at the beginning we had 5 million rough
roughly um the capital improvement project requests are for FY2027 using 2.2 million and then other capital and capital articles requests are using uh roughly almost 2.5. Um, we have a
balance in free cash around 246,000 if all these articles go through. >> Yes, John >> Carrie, do you have a do you have a list of all the articles and assignments of free cash like
>> Yeah, I canated I can get it for you. Yep. You're welcome. >> It is. Oh, it's in here. Yep. That's okay. Thank you for the reminder, Jo. community preservation articles. So, the CPC uh received 13 applications
as of November 1st, 2025, and they plan to vote February 2nd. The total amount of applications is just over 3.3 million. and this amount exceeds the community preservation balance and estimated receipts
approximately 2.6 million. It is recommended that they leave roughly 300 to 500,000 to have a starting balance for the next fiscal year. So, um there's probably going to be a few of these that they don't put forward
or a few of these that they'll uh reduce the amount. I'm not really um positive on items that they're not going to be approving, but um we'll see. It will be an interesting
meeting on the second to see what they do approve put forward. Um and then we have our 2027 budget calendar um for the annual town meeting. Um some important dates. The finance
committee preliminary recommendation is due to the select board on February 17th. The select board um approved budgets transmitted to the finance committee on February 20 February 24th and the finance committee warrant
article recommendations are due March 11th. Um annual town meeting warrant closes on March 17th. Annual town meeting is on May 11th and the annual town election is May 14th.
>> And that's our budget presentation. >> Terrific. >> Any questions? >> Very much. Any questions from the committee? >> I'm gonna write questions. >> Still getting those muscles warmed up. John, please. Um, again, I haven't reviewed everything in detail, but uh, I think as a town manager said, it's lean
on purpose. It certainly seems to be that way. Um, I imagine a majority of the increase over last year has to do with contractual obligations and health care and energy costs as you pointed out.
>> So, um, on very first glance, impressive. >> Thank you. Joe, would you like to say something? >> Yes, I would. Thank you, Mr. Mayor. So, we just Carrie and I and a few others just came back from the Mass Municipal Association annual conference and
meeting, and it's it's really surprising to hear how many Massachusetts municipalities are looking for overrides just to fund their operating budget. And um there was a report that was issued about a month ago or maybe longer.
Carrie and I read it and we really just wanted to still provide level services but really start mapping out or mapping out even further than we normally do for a fiscally sustainable budget. And so that's why there's no new positions uh
at this time. Um right now we're waiting to see or or waiting to um really get a feel for how the new positions have been working out, which we know they have, but how much workload they've absorbed, which will be great. And then we're also Carrie mostly is diving through previous
warrant articles. So the borrowing recisions which actually don't have a fiscal impact but looking at old articles to transfer funds to help offset other projects. So we've really dug in deep on this one. So thank you. >> Two more questions. My questions seem to
be coming in pairs. Um, with respect to kind of what you heard at the conference and the override, were there specific drivers that kind of rose to the top of the heap uh across the various towns? healthcare seems to be the largest.
um keeping up to date with um private sector on salaries um pension um staying within the Prop 2 and a half is been really difficult for towns because
you're you're basically, you know, you you can only go up two and a half% and sometimes that's not enough to support your budget >> um with the increases that we're seeing >> and with constraints on the levy limit itself. A lot of towns are are raising
so raise an appropriate on their articles. Um you've seen a shift. Last year I think we used more the tax levy. This year we tried to take a break from that. There's still some items um dredging. It doesn't really count as a capital item because it's not depreciable. Uh but it's something that
benefits everyone. So I think the other towns are are having these operational costs that aren't being absorbed by the ex excess excess levy capacity.
>> Do thank you. Do you ever foresee a time when we would go to a zerobased budget process and just take everything back to the root and build it up again?
And or would there ever be a time where we would consider not providing a level service operation in the face of budget pressure? So I think the last time the town really considered a zerobased budget was before
I was here. I think 2009 2010 >> and I think with the new software that we're getting that's used by like most municipalities we're going to be able to see performance and cost centers better than we ever have. And that's basically
AI doing that work for us with the the prompts that we put forward. I I think, you know, there's es and flows. When, you know, I first started in Massachusetts, it was 2001 and and communities were hit pretty hard and so they were doing zerobased
budgeting. It's just in today's complex finances, it's really hard to just have a clean slate, right? But I think with the technology that we'll get and it's much better than ours and also Tyler's been in business for at least 25 years
just in in um on the East Coast but longer on the West Coast. I think we're going to have the data to look at that some of the stuff Carrie and I do as we I'm a hard copy person looking like through all the financial reports and trying to find these trends and and
we're good at it but I think this will enhance uh the way that we budget in the future. >> Good. I think we're fortunate to have you both. Uh Barbara, please. >> Thanks, Mr. Chair. Um, I noticed there are no new positions requested this year, but I was wondering, did any of
the departments wish they could ask for uh additional positions? >> Um, we did. Um, we alluded to that in um the packet. I know you haven't had a chance to review it. Uh, the police chief has
asked for an additional position, still trying to um I guess balance some of the the overtime and forced overtime. um but also just the workforce that's needed for the department. But he knows that it
wasn't funded at this time. And as we go through the budget review process, you'll see the budget next week along with the select board where we'll be reviewing public safety budgets and DPW. And there there might be some appetite for funding that position, but we didn't
put it forward at this time. And um I see in the paper that four people from our health department have resigned. Are those hard resignations? I mean, are they gone? And if if so, is that going to hurt us until we can replace them? >> Um that's actually for four board
members. They're the appointed officials by the select board. Okay. >> Um our our staff is solid. We have a couple retirements coming up, but we we have a really great bench behind them. So, I think we're okay on the town employee side of it.
Phew. I must have misread that. >> Andy, please. >> Um, Mr. Chair Carrie, I'm not sure who's got the answer, but the future meeting schedule includes this coming Thursday. Do Do we have time of day for that yet?
>> Thursday. Um, the FinCom meeting is at 1:30. >> Okay. And then there's a joint meeting. >> Yep. The joint meeting um on February 3rd is at 4 o'clock. Thank you. I wanted >> I mean that I know I knew that was going
to be a change this year. >> I had originally had it at five o'clock, but we changed it to 4. So yeah, four o'clock. >> February 5th the same. >> Um so February 5th will be um a Thursday and that's at 1:30. >> 1:30. Okay.
>> Y Okay. Just some advanced warnings so we know what to look for. Yeah. And most of your meetings will be the Tuesday, Thursday at 1:30, your normal time. >> Yeah. >> Um I think the only one that's different is the joint meeting with the select board on the 3rd at 4:00. >> Okay.
>> Now, there had been some charter chatter with respect to that at 5, but we're firm at 4. >> Yes. >> Yeah. >> Okay. >> Very cool. Do we know just tangential to um the question has Chief Anderson been
able to fold the pos fulfill the position >> or does he have to wait for the end of the fiscal year or >> so he was granted one last year right? >> He doesn't have any vacancies. He he does he actually has one um Jeff Phillips has recently retired and so
he'll be recruiting for that position >> and then we have three people in the academy which I think ends in another month or so and it's a lot of the hiring is based on an available spot at at the academy.
>> Okay, that's helpful. Thank you. Did do those three positions at the academy include the one that he was granted last year? >> Yes. >> Okay. Terrific. Thank you. >> All right. Further questions. All right. You're getting off easy
today, I guess. Um >> plenty of time. >> All right. The um All right. So, next on the agenda is the brief discussion on the residential tax exemption. Um I don't know about
you guys, but I've had a lot of incoming traffic on the matter. Uh there's obviously been some um letters uh in the Chronicle and I got a
email from one of our colleagues uh earlier today that was a sternly worded objection to the undertaking. Um, I think what I was very disappointed that the select
board didn't seek our input with respect to this very impactful undertaking. And I think what I would like to do is set up a working group of the finance
committee numbering three or five people depending on who's willing to raise their hand and see if we can't dedicate some time to eval reviewing and evaluating the RT whether there are alternatives
that we can take advantage of whether we are fully utilizing all the exemptions. ions available under state law. We've got roughly I think 12 of them. Uh involving a total of 90 people. Um does each of those exemptions are they u kind
of available to the full amount that's been authorized by state law? Um and are there other mechanics? I think one of the things that troubles me personally the most about this is that the select board has never identified the cohort
they're trying to help. which to me is a monumental fail in terms of process. Um I don't think that somebody who's earning a million dollars in investment income or wages and salary but who lives in a $2.5 million house
well below the threshold the anticipated threshold needs a tax break. um and the inequity of it. Um I've heard from a lot of year rounders who think it's just a terrible divisive
thing. So give some thought as to whether or not you might be interested in working on some ideas that we would present to the select board potentially with uh a request or an article to town meeting that would seek to defer implementation for a year.
uh while this thing is more thoughtfully considered and perhaps reformatted to some degree or another. So that's I'm happy to have anybody say anything they want at this point in time, but that's what I just wanted to throw out there. So John, please.
>> Yeah, thanks. I I read the article, the most recent article on the Chronicle. I actually watched the select board portion of the last select board meeting on this issue and the discussion. Um I
I haven't seen a clear articulation of the reason the select board went down this road. So while I support your recommendation to form a working group, it would be helpful for the working
group to have a goal or a target that it's working towards. Um, so it's I don't expect you to answer that because unless you know of a specific goal that's been articulated. >> Funny you should ask. >> Thank you.
>> Um, well, I think it would be up to the working group to develop its thinking on what the goal should be. I would ideally like to see some analysis of the cost and benefits of the proposal.
Um and again sort of an exploration of what alternatives might be pro p prospectively deployed uh in lie of just a blanket RTE. Uh again is there a more surgical approach to
solving whatever the cohort and we would have to be you know getting input from the select board from other towns Cape Cod commission. I mean, you know, I think we'd have to turn over a lot of rocks to learn as much as we can about the experience in other towns. Um,
but I see perspectively kind of two work products. One is an analysis of the RTE and prospective alternatives. Two would be an article town meeting which would be advisory only. I mean, we can't tell the select board. town meeting can't tell us like
we're to do but some something the effect of the sense of town meeting is to put this offer uh not necessarily to kill it but to put it off and have a little more engaged conversation about it so broadly that's how I would see
prospective work product I think that would be helpful I'm just you know I read the same article John and you If the quotes are accurate, clearly the purpose is to, you know, provide relief to year round residents
and to help folks who live in this community. But they did nothing to define who those people are because real estate tax is regressive. It has no nothing to do with
ability to pay or the need of the people that might be involved. Now, at the same meeting, or was at a later meeting, there was a town voter taxpayer who made some proposals
referencing specific pieces of state law. And I gather there may be a petition article or two already in the works to adopt um broader or more liberal
um qualifications and and amounts uh for tax exemptions, right? and for tax deferrals for Chattam resident taxpayers
who demonstrate a need, but it's a demonstrated need, not an assumed re need. >> John, please. >> That's helpful. didn't what isn't there already a working group to that's been uh
>> so we have the the >> people in need taxation aid committee >> uh which I happen to sit on and again you know preliminary thinking would possibly suggest that that could
be the enterprise that evaluates applications for assistance maybe this is something that like the Lauren Seldon program like the daycare program gets funded by the town on an annual basis
and there's a specific you know again is this possible under state law I don't know but that's something we could look into. There is very specific means testing for the t work of the taxation aid committee under Massachusetts general
law. Could we submit a home rule petition that allows us to create a means tested element branch element whatever uh in the portfolio in the oversight of the taxation aid committee
I mean it would seem certainly to be mission congruent but you know whether that's viable under state law I don't know but these are the kind of questions that I think this working group could provokey you I mean, I'm particularly struck
considering sort of the somewhat ambiguous goal that they stated that a lot of these things associated with the real estate tax exemption don't really work to hit that goal.
Um, you know, how about all the people in town who are renters? They don't get I'm on, right? Okay. How about all the people in town who rent property but don't own it? They're not going to benefit from that.
At least certainly not by action of the real estate tax exemption. Then all the other people who have some secondary property, it's nonowner occupied. They may own it for investment or for their children. They're going to
get whacked with a non-resident tax as well. Then there are the folks who happen to live in a particularly valuable property who I guess is somewhere between 400 and 700 in number who are going to get no
benefit whatsoever from the RT. They're actually going to build for significantly higher taxes despite the fact that they may have a need. they're simply not determined,
right? The way this thing works. Um, that's astonishing. And then of course there's a small matter of, you know, the what is it,500 approximate trust in town. We don't know how many of those are for properties that are owned by
town resident taxpayers or not, but gee, you had to reddraft your trust as of December 31st last year in order to qualify. Give me a break. They're passing something that or they're
intending to pass something that means people have no way to comply. So I'm I'm Yeah, I'm >> a dog's breakfast. >> Yeah, pretty much. Right. Um
carrier gel, I mean is I think there are or at least there was a submission of some petition articles to broaden the application of some of the state laws. Or did I mishar it? Um, I think it was mentioned during the
meeting that somebody was going to bring forward a petition article, but um, I haven't seen anything come through yet. >> Okay. >> I think they're contemplating it and maybe circulating a draft, but we haven't seen it formally submitted yet. >> Ah, okay. All right. Because it's quite clear that under under those sections of
state law, by some town action, whether it's by executive action or by town meeting or perhaps a ballot, that in fact we can broaden the limits, raise the limits. Um so that the exemptions and and deferrals could apply to a
larger cross-section of people depending on need and it actually requires a needs test. Well, and as noted the the opices of the tax a taxation aid committee,
uh there's a very prescribed application process that includes the submission of tax returns as required by state law. So there there is a model that's out there.
Anyway, John, please. >> Just from my own information and anyone who might be watching this or watch it later, what's the process here? I mean, the decision's been made and that's it. Does this doesn't go before a town
meeting? >> No, it doesn't. It gets approved at the classification hearing. So it'll have to go through approval again um when we have the classification hearing in September when we set the tax rate. So that's the time when the select board
can vote to approve the residential exemption or not or just stick with >> but the town assessors have to be prepared >> correct well ahead of time. >> Yes. Yes. The town assessors have to be prepared for it and that's why we're trying to stay on top of it and get
things moving. So >> it just seems like a very significant change that can happen without I mean we have to go before town meeting to spend a very small amount of money and we duke it out on town meeting floor
and people have an opportunity to influence the town folk prior to the vote and this just seems like I'd be very careful here. Okay. So, give it some thought and uh if you're interested in participating, send
me a note and uh we'll see if we can't do something along the lines of what we did with respect to the housing matter back in what 21 I think 20 or 21. Come up with a suite of possibles. Um
all right. >> I do have one thing to mention. Um, Greg did say that his barn hill is more of a construction reconstruction than a maintenance. Um, but he'll be presenting on Thursday to go over all that. I just wanted to mention that. >> Terrific. Thank you.
>> Welcome. >> Um, okay. Further comments, questions, observations as we release the hounds. Okay. There being none, I'll take a motion to adjurnn. >> Seconded. >> Second. >> Thank you, John. Favor.
>> Yes. Kristen, >> yes. >> Andy, >> yes. >> Tommy, >> yes. >> Barbara, >> yes. >> Chairman says yes. We are adjourned. Thank you guys very much. Appreciate it.