This government meeting is brought to you by Eastworks and our local cable subscribers. >> Good morning, Southampton. >> Good morning. >> Welcome. Welcome. Welcome. Quorum being 50, we have over 50, so we
can begin our special town meeting. Please rise for the pledge of allegiance. Judith Miller Conland, our chair of the Southampton Cemetery Commission, will lead us in the pledge. I pledge allegiance to the flag of the United States of America and to the
republic for which it stands, one nation under God, indivisible, with liberty and justice for all. >> Please be seated. Thank you, Miss Conland. Good morning, fellow citizens of Southampton. Welcome to our 2026 special
town meeting. I'm Robert Floyd, your town moderator. Thank you for your continued support. It's an honor and a privilege to serve you. I also serve you as being clerk in the Southampton Cemetery Commission. There is no compensation for either role.
Thank you for prioritizing this morning. Let me read the warrant. Southampton, Massachusetts special town meeting, January 10th, 2026, 10:00 a.m. William Minor School. And you are hereby directed to serve
this warrant by posting the tested copies thereof in six usual places in said town, 14 days at least before the time of holding said meeting. here fail not and make due return of the warrant with your doings thereon to the town
clerk at the time and place of meeting as were said given under our hands as 23rd day of December in the year 2025 signed by the select board attested to the council May we have a moment of silence now in keeping with Southampton's culture for
those who have moved on ahead since our last town meeting even only a month ago. Hold them dear in our hearts. This morning, a special town meeting will be recorded and streamed on the East Hampton Media YouTube. This afternoon, it will not be live. Thank
you, Tim Riley, Jacksonfoot, Jody, and E Media. My opening remarks may easily be longer than the actual meeting for one article. So, I will dispense with most of my opening remarks. You're welcome.
Speaking at the mic, ready to contribute something new. Please approach the microphone by up front. Stand in line, be acknowledged by the moderator in order. First come, first serve. I recognize speakers only when they stand at the mic, unless it's a point of
order, which can be called out from your chair. Address the moderator. Clearly state your name and address. Speak up to five minutes at a time as long as you stay on topic regarding the motion and direct your opinions, questions, answers, and remarks to me, not the town meeting
audience. Listen attentively. Vote according to your conscience. Can I hear a motion for article one, please? Hello Is it done? Okay. Hold on. Mr. Moderator, I move that the town
reduce the amounts to be raised and appropriated for the town's FY 2026 operating budget as voted at the May 6, 2025 annual town meeting in the amounts and for the purposes as shown in article one of the January 10th, 2026 special
town meeting warrant. >> Motion made. Do I hear a second? >> Second. >> Motion made and seconded. Who would like to speak on this? And if I'd extended the five minute maximum for this presentation to 10 minutes. >> Mr. Moderator Scott Zebach, town
administrator. Uh I just want to apologize for having to take up uh some of your Saturday. Uh we did, trust me, we did everything we can to avoid having to meet today. Um I would like to give a quick timeline, explain the issue at hand, and talk about putting in place procedures in the future. Uh, in late
November, the select board had the classification hearing for taxes after the Department of Revenue approved the new valuations on property. Every year, our assessors review the town's property values, and then the select board decides if there will be a single tax rate for residential and commercial properties or if it should be a single
tax rate. As with most municipalities, this um they vote to go with just a single tax rate. Once that is complete, the town is able to begin submitting our financial numbers to the Division of Local Services or DLS, which oversees all the municipal finances throughout the state
in December. And that's to verify our tax levy and begin setting the tax rate. This is required for all municipalities. As part of setting the new tax rate, DLS, Division of Local Services, reviews many financial areas of each municipality, including but not limited
to the tax levy, overlay, and abatements, estimated receipts, and tax base growth. After a lengthy review, DLS has requested that the expenditures scheduled for the FY26 budget be reduced prior to setting the new tax rate. This will keep a balanced budget as presented
at annual town meeting. This is done every year and with the emerging financial issues across the state, this is not a unique situation to our town. Specifically for Southampton, the DLS did have some questions this year which added to the time needed to get here. For example, last year we took the
initiative to provide a transparent budget that provided actual expenses, funding sources, and revenues. This change provided the taxpayers with a true picture of where we receive our funding and where it's spent. For example, nor school's budget showed non-town revenue or offsets in the
amount of $763,000 from different grants, revolving funds, and school choice tuition. This is money that is used outside of the general fund or what is raised by taxes. This detail never been shown before and is a way to be transparent with true costs.
Similarly, on the town side, we wanted to include, for example, the $175,000 grant that the town receives that we applied to our regional dispatch agreement with East Hampton. DLS helped us on how to best report these additional revenues to the state in the future and how they apply against our
expenditures and revenues. And we now know how to best report these revenues to DLS without delay while still providing the transparency of the costs to the town. After that, we worked the DLS on reviewing our cherry sheet revenues and offsets, which is just over $4 million.
Although it's weirdly named for the color of paper they used in the past to send them out, cherry sheets are essentially the money that we receive from the state as determined by the governor and state legislature as well as the money that is owed to the state through assessments against the town.
These are things like library funding, school chapter 70 funds, and general governmental aid. These figures are not approved by the governor and legislature until later in May or even June of each year, well after our budget is approved, but we use best practices and remain conservative in our estimates. DLS makes
sure that our assessments and approved funding balances are aligned to our approved cherry sheets. We also found some discrepancies in how our death service had been reported to DLS. This would impact the amount that we can raise on the tax levy. We were able to go through all of our borrowing since
2019, double-check everything, and submit an accurate account to all the debt exclusions from dump trucks to loaders, as well as recording approved and rejected ballot questions. Everything was submitted to DLS and was approved because of the help of the hard work of the town clerk and new town
treasurer. Everything is corrected and processes are in place to record these debt exclusions in the future when they come up. In fact, how we record and report our debt schedules had already been a project we were working on thanks to a separate recommendation from DLS when we requested them to come in this past summer and fall to provide guidance
and support through a financial practices audit on where we can improve. And you will see a detailed debt service schedule in each budget moving forward that outlines all the information. The DLS did raise some questions on our revenue estimates as well. For example, this year we estimated $180,000 in new
growth and we were expecting to receive at least that amount and we were hopeful for another year above $200,000. This is similar to last year when we expected new growth to be $180,000 and it came in above estimates at over $200,000.
We rolled over the same expectation of $180,000 to this year, but it looks like our new growth will come in under $120,000. Historically, new growth for Southampton has been consistent and also relied upon for building the budget. Even going back 15 years to FY11, new growth was
181,000. In FY12, it was 193,000. FY15, it was 201,000. And you can see the results of that new growth around town, especially in construction and homes being built over the last 20 years. More recently, the average new growth over the past 6 years is 185,000.
this actual new growth going back the last couple years. In 2020 it was 201,000. In 21 it was 172. In 22 it was 1868 186,000. In 23 it was 181,000. And in 25 it was $27,000.
Last year we budgeted the same 180,000 as years past and it came in at $26,498. What we relied upon this year was that same $180,000 as last year. a conservative number based on our historical trends. Unfortunately, it came in the lowest it has in years, if
not decades. We will see a slight uptick in some revenues like cannabis tax and meals tax, but it's not enough to make up for the difference. And we will receive a very small and we only receive a very small portion of our revenues, less than 7% from these types of revenues.
Another issue was our overlay. Our five-year average, which is the standard benchmark to use use, is $97,000. Overlay is essentially an estimate of tax revenue that we won't or can't collect. These are things like people not paying taxes to exemptions for our
veterans, uh reductions in senior taxes, either directly or through senior tax workoff program, uh programs that are vital to the community. This year, the reduced revenue will go beyond our 5-year average and will likely exceed $130,000. Next year, we're already planning on
that to grow between 150 and $175,000 in tax revenue that we won't be able to collect. What this means is that the DLS, after reviewing everything from cherry sheets to death service and exclusions to our meals and cannabis taxes, building permits, and on and on and on, is
requiring us to reduce our FI26 budget to stay within what they can approve as a tax levy limit. The reductions will not impact current personnel or services, but are already part of the spending restrictions that the select board implemented over the summer in anticipation of the impact of a potential economic downturn and
upcoming budget shortfalls for next fiscal year, as well as increases in cost for health insurance and other areas. The town has already started tightening our finances and put a freeze on hiring new positions or filling old ones that are non-essential. Even though these positions are important to our operations, we need to stay within our
financial guidelines this year and also in preparation for next year. There is also no reduced reduction in school funding. The vocational tuition is again budgeted months in advance in March and April and we won't actually know the real enrollment numbers and costs until sometime in July and August.
This is something that we normally provide enough flexibility for. In total, the reductions that DLS require will be $195,000 based on their calculations. Now, these types of projections are a moving target. We've we're looking at limited data predict what revenue will be 69 and
even 12 months in the future. One of the problems is if we have a thin margin, then we may have to adjust spending in the future. With the budget last year and the proposed override not going through, we recognize our projections for revenue would be thin. On the opposite side, if we underestimate too much, it might give us more room for
revenue suddenly declining, but also mean potential cuts to nor school, the budget, services, um, and other personnel. Going into next year's budget, we put into place guidelines and practices so this doesn't happen again. Our new growth will be estimated at its lowest in decades. Our overlay estimates,
again, taxes that aren't being paid, will be higher than has ever been. There would be flexibility built into the revenue estimates and cherry sheets with possible reductions and and flexibility. The hope was that we could at least estimate similar revenue sources for another year or two, but this may be a
very serious indicator that the economy will be slowing down much sooner than expected. Southampton has historically relied on high new growth, low overlay, and other revenue sources such as ARPA funding and limited grants like our $175,000 uh dispatch grant, which is expiring to
fund the budget. The state has failed to also keep up with providing towns their fair share of funding, but looking at next year, we have to realize that those funding sources are simply not going to be available or as a reliable revenue source. Ultimately, we have been working hard to
provide a transparent budget, implement best practices, and already working with the DLS, identify areas that we can improve our financial processes and procedures. We already working on the recommendations from the previously mentioned financial processes audit that we requested the state to perform over the summer and into the fall that focus
on our financial systems, which will be released to the public next week after having our meeting with the DLS that we had this week. Thank you for your time. >> Thank you. Anyone like to speak in opposition for the motion of article one?
Any comments? The floor is open. John Lumber College Highway. Um, I oppose this, not because we have to do the vote, but uh, and I realize I may be in the minority on the select board, but last year's override didn't go through. Fine, whatever. DLS says we have to cut
another 200,000 or 195. may not impact essential services, but I suspect the $57,000 cut to the fire department means we're not getting the second paramedic that three years ago we voted for. Um, so we are suffering. We are going to continue to cut. We are going to die the cut of a,000 cuts here and going through
Tuesday night joint session select board finance. We're a half a million dollars in the hole. There's no relief in sight. We cannot continue down this spiral unless we want to cut services. We want to go to part-time, we go part-time. Part-time clerk, part-time administrator, eliminate the fire
department, rely on special services, whatever it is. We can't continue to cut, cut, cut, cut. Thank you. Anyone else like to speak? Any comments, questions? Seeing none, we'll vote on the motion for article one. All those in
favor, please indicate by saying I. I. >> Opposed, please indicate by saying nay. The motion for article one passes by majority. That concludes our business for the morning. I will entertain a motion to dissolve our special town meeting.
>> Second. >> Second. >> All in favor? >> Opposed. The special town meeting is dissolved. Safe home. Thank you. Lucy D, our town clerk, deputy moderator Sarah Simmons, our counters, police chief, Eastampton media. Thank you for your
value participation. This government meeting is brought to you by Eastworks and our local cable subscribers.