Hey, AJ. >> Hey, Susie. >> I think um if it seems appropriate, I want to say something about rural aid advocacy. >> Okay, good. >> I'm working on a project that will be at the school um for the week of the 9th
through the 13th, an action that we'll we can see if we can get attention from that. >> Great. That sounds great. Um, something you can maybe get some press coverage about. That's great.
>> Yep. That the state house. >> Okay. Very cool. >> I guess. No breakout. >> No. >> Don't know. Yeah, it well it's going to be a big group
probably, right? But I wonder how the weather is going to affect participation today. >> Probably no highway. >> I can't imagine we're going to see Dave. Yeah. >> Yeah. >> I was so looking forward to doing this at the library.
>> Yeah. All right. There is street mark. Hi everyone. We're going to just give it a couple more minutes as people roll in. All right, I think we'll get started.
Uh, I'm sure there'll be a few more folks and I'll just let them in. Uh, want to thank everybody for making yourselves available today. My name is AJ Cashew. For those I think I know everybody here, but just in case.
Uh I'm the chair of the finance committee and I'm joined by uh most of our our finance committee today. Uh Laura Soto, April Stein, George Arvinitis is here. Uh Susie Moer
is here. I think I saw Molly Moss in the list here. Yes. And uh April Stein, if I didn't say April, she's here as well. And I think that's everybody that's here. Um, yeah, I don't see Jim Walton
is another member of the FinCom, but I don't think he's here yet. Uh, and uh, I guess we'll just get started. So, I wanted to thank Haley for holding this together. The finance committee, I think, is is trying to do a couple
things a little bit differently this year. Um, and one of them was uh sort of anticipating what what would be a very challenging year. We pulled this group together. Um, I think that was in November. I can't remember now
actually or October or November. Um, just kind of talking about um the sort of outlook uh for uh this FY27 budget year that we were going to begin working on. Hi, Ellen.
>> Hi. Uh, excuse me, but since I have called a committee meeting for for capital planning, could I call it to order, please? >> Yes, thank you for reminding me. So, there may be others too. So, yeah, please go ahead, Alan. >> Okay, so there I call this capital man capital planning meeting to order at 306
with at the moment three members of the five present and that is George Ivanitis and Laura Seoto and and myself. >> Thanks. I should have mentioned I'm calling the finance committee to order uh 3:05. Are there any other committees
or boards that need to um announce that they are meeting? Let's see. I think I see so that might >> Eric. >> All right. Any other committees, boards
need to come to order before we move on? Uh, Eric, I see I see you and Rita here. So, does that mean the select board needs to be called to order? >> Hi, Rita. >> Hi.
>> Do you need to call the select board to order? >> We are call to order. I'm sorry. I was muted. people asking. >> No problem. Okay. >> All right. And I'm sorry I didn't see Rita the first time. >> No, no worries. All right. So, um uh I'll uh just mention again that we're we're trying to do a couple things
differently this year. One was that we pulled the this group together uh back in November, which is kind of the beginning of our process of putting together an FY27 budget. And I believe at that meeting we said we were going to kind of reconvene in in January or
February, probably a little bit later than we thought we would to give you an update on kind of where um where we are in the process and what um our preliminary estimates um look like and what some of the
implications of of of that information might be for the town. So that's that's our purpose here today is to kind of report back to all of you on kind of where we are and um and and what's coming uh as far as FY27.
Um so I really want to start by being very clear about yeah where we are in the process. This is there was a handout distributed in advance. We do have a draft budget. It is most certainly a work in progress. We're not finished. Um
what I can tell you we've done is we we've um received proposed budgets from all uh departments and and committees that um make up our operating budget. Uh we've met with uh every department head
um to kind of understand better understand the decisions that they've made and the assumptions uh behind their requests. um really appreciate the thoughtfulness and professionalism that went into those pre
preliminary budgets. Um, we used the information from those pre prelim pre preliminary budgets as well as some initial revenue estimates provided by the state to build what I'm going to call today uh refer to as our kind of
baseline FY27 budget and and it reflects the sort of current cost realities budget estimates before any adjustments are applied. and we're going to spend some time talking about what kinds of adjustments that the the finance
committee is going to recommend. And that um so th that preliminary information basically produces um an operating budget that stands at basically just short of $8.5 million. So
$8,464,539. Okay. Again, that's our sort of baseline estimate before any adjustments are made. And I should mention there are we know that there are certain line items in that budget that are going to need to
change. So, it's really it's not um there's nothing in that budget that is uh absolutely set in stone. And we know of a few things that we're expecting to change. There are some placeholders for various lines. So, it's kind of our best
estimate at this point, but again, it's it's it's a work in progress. Um, so that budget results in a um 9.1% increase in our operating costs as
compared to FY 26. And there are a few things I want to say about that. Um I think most importantly is that the the vast majority of that increase is driven by um fixed costs or
an obligation of some point of some type like our health insurance assessment. um a a an assessment related to our elementary school that where a we have a student in our district who um requires
an out of district placement and we're obligated to um to support that placement that has a very significant cost to it. Um we have debt service. Um we have um an oped account which is a a
fund that exists to um support our future um benefits for town employees. Um we have co a cola policy that our personnel committee um has developed a
few years ago that results in cost of living increases um for town employees. So there are no major like new programs embedded in this budget. So it's not it's not like expansionary spending.
it's um cost growth that's kind of or or you know largely um sort of outside of our discretionary control. I actually think department heads did a very good job this year. I think recognizing what what the FY27
outlook was that we communicated earlier this year and for the most part brought to us what I would describe as kind of very lean um level services budgets that did not include kind of yeah any kind of expansionary
spending or costs. So what does that mean? So, if we were to adopt this baseline budget without any adjustments, the estimated average single family tax bill would
increase by approximately $851. The finance committee does not believe that is um a responsible outcome without taking measures to mitigate that that impact.
um or you know kind of further reviewing um where we are. So, um, so that's kind of the stage of the process that we're at right now is we're considering a variety of adjustments or mitigation
strategies that will um kind of reduce the impact of that or minimize the I should say the impact of that um that uh baseline budget on taxpayers. Um so what
do I mean by mitigation strategies or adjustments? They're really sort of two types that we're considering right now. Um one type is applying um cash reserves to fund certain items
in the budget. And we have to be thoughtful about how how and where where we do that because it's not as you might understand kind of it's not um it's not responsible budgeting practice to be
using cash reserves to fund um uh recurring operating costs, right? Um so what we have done and this is not the first we've done it several years in a row now is we've looked for
opportunities where we have um expenses or items in our budget that are sort of by their nature uh not sort of permanent recurring kinds of expenses that there there's some fixed term to them whether that doesn't
necessarily mean it's a one year but it's it's it's it's not a long-term um cost that's going to live in the budget in perpetuity. So that's one type of of of of budget line where we're we sometime you
know we we can sort of deem it appropriate to apply some free cash and then there's a second kind of category which is you know la particularly this year and and the last FY26 year there are a couple of items in our budget like
the health insurance increase is is a good example where they are so significant um that we've felt like it was responsible for us to ease in the impact
of those increases by applying free cash. So, health insurance is a good example like last for FY26 that um that our our um health insurance for town employees costs increased by
40%. that we felt like that was an enormous burden to put on taxpayers in in a single fiscal year. So, we applied a fair amount of cash to the to the budget last year to mitigate that um that
increase. And we're actually going to do something similar to this year for health insurance. But the the reason I'm highlighting that one is it's it's that is an a case where that's not a temporary increase, right? that that that nobody in here here has any
expectation that health insurance costs are are going to are going to reduce. Um this is kind of the world we live in right now. And so um the reason why we're applying uh cash reserves to ease the impact of
that cost is because it is of such a large impact. we felt like it was better to kind of smooth the impact of that over multiple fiscal years. So, or more than one fiscal year. So, so those are the sort of two types of adjustments that
we've considered. Um and uh we we've we've already identified um certain lines. So, we've we even just in our most recent meeting, we've talked
about applying about $194,000 cash reserves. Um, and we're recommending about $86,000 in targeted budget reductions. We'll walk through those a little bit later. And taken
together, those steps would reduce the estimated uh a increase in the average single family tax bill from $851 to $543. Uh it's a meaningful reduction of about
300 a little more than $300 per household. But we're not done. We we have a kind of informal goal to explore other kinds of adjustments. Uh hoping to that we can responsibly
bring that projected increase below the $500 law mark and perhaps even lower than that while maintaining core services and ensuring our long-term fiscal stability. So, that's kind of
where we are in the in the process. Um, just a couple other things to emphasize before I I I'm going to turn it over to my colleague George Arvinitis to just walk through a couple of details. But, um, few things I want to emphasize. Um,
uh, our handout mentions this. This is a a a phrase that uh Susie Moer from the fincom I think it it's it's really stuck with me. This idea that what we have here is fundamentally a funding problem
and not a spending problem. Um our our you know state aid that we receive from the Commonwealth has not kept pace with structural cost growth and inflation. Um, our tax base is heavily dependent on
residential property taxes. Operating costs are rising faster than than corresponding revenues or even allowable levy capacity, which is going to be an issue that we'll talk about. And so that structural mismatch is kind
of the broader context that we're we're dealing with. Um, so it's not the case, at least I think from from our perspective, that there's um any sort of like irresponsible
or um spending happening that's that's that's contributing to this problem. It's it's really a problem of a kind of mismatch of revenue and rising sort of inflationary costs and um
obligations, financial obligations and limited um grow opportunities for growth and and this reliance on on the property tax base that's that's created. But that's what this problem um is. Um,
okay. So, uh, I think the last thing I want to say is that, you know, our goal today is is transparency and collaboration. We we welcome your input. If if there are adjustments that can be made with minimal service impact or or
risks, obviously, we would love to surface them. I'm not sure if if there are, but we we are we're certainly open to that. Um and and I want to also acknowledge that um you know this is an
opportunity for advocacy as well. Um I'm going to ask um my colleague CZ Moer a little later to talk about some efforts that um are happening throughout the state to advocate on behalf of towns like ours um to address the the kind of
revenue problem uh that we're dealing with. Um, and I want to just say that, you know, we're all working towards the same objective, which is a fi a fiscally responsible budget that's um sustainable
and fair to taxpayers while at the same time preserving core services that our residents um have come to rely on, consistently support um through their participation
in the budget process. at annual town meeting. And so um that's the goal. Uh so so again, thanks for coming. Thanks Haley for pulling this together. Uh and I'm looking forward to our discussion. So um
let me do this. Let me uh have George, if you're um available, um I would love for you to just sort of talk through maybe some of the details that got us to um
the kind of current baseline budget that we're uh we're looking at. And I can share George uh I think one of two documents. So you tell me which would be best to do this. the >> well I think what you what you wanted me to show was um the development of the
budget and then um how it impacts his tax taxes. So it would be the preliminary >> the summary sheet >> and that has two tabs that we'll look at right we'll look at the summary and then we'll look at the considerations. >> Yep. >> If in detail although you've covered them but yes
>> that's where I would start. >> Yeah. All right. So can everybody see this well enough? I'll make it a little bigger. Is that is that okay for folks? Is this readable? >> Yeah. >> Okay, George. Um, do you want to take it away? And
>> yeah, sure. Yeah. So, so, you know, we're good afternoon everyone. Um, you know, we're all aware of I think everybody's aware based on our meeting back in December of some of the financial difficulties. And so what we did as a finance committee is we're just trying to
monitor the impact on taxes um knowing that you know it's it's difficult for um the community. Um so what we start with is this very first section rows 5 through 18. Essentially what we've done here is
started with last year's uh budget or this year's budget FY26 operating budget the year we're currently uh living in. Um, and you can see the increases from line seven all the way down to 18, uh, 16. Um, mostly in order of size, not exactly,
but pretty much the three largest are the ones at the top is a and AJ really covered these pretty well. Um, outplacement represents $114,000 of the 164,000 that we're looking at for an increase. when you take that in if
you adjust that increase for the house place services the school is asking for 2.7 increase uh health insurance as everyone knows has just gone through the roof if you read the papers every town is dealing with this problem every town's dealing with all the problems we're facing as a
matter of fact and I think most of you if not all of you are aware of that health insurance increased 43% last year this 148 represents another 20% increase is what the Treasury told us >> it's possible it could come down a little um 30,000 at most, but we think
that would be risky. Um probably we'll take it to 18% which would save us maybe 15,000. So that's certain certainly something we're considering. Um library debt kicks in this year. That's full principle and interest. That is based on 10 years a 10-year note and we're going
to address that later. OPED. Um, you know, we've been funding OPED at $50,000 a year. Other pension Oh boy, never mind. Um, it's post um >> retirement benefits. So, we have to pay
health insurance mostly is what it is, a portion of health insurance for all retired employees. And we're building up a fund to do that. And we've been building up that fund by contributing from the operating budget $50,000 a year. Last year we made that zero to try
and mitigate tax impact. This year um we put it back up to 50 because we'd like to start that funding process again. A highway department had um a large increase this year. I forget what the percentage is, but they're uh mostly this is maintenance
repairs. The uh aging equipment has really um been um created quite a challenge for Dave. And so, um, that's what that increase is. And then we have the debt for the high school. Um, it's been running about $35,000 a year. Next
year, it's going to double essentially um the track and the middle school roof. We're going to see that line continue to increase over the next few years. And our long range plan, that is definitely one of the um nuts we're going to have to crack. One of the difficulties we're going to have PAS debt. We have been
borrowing for our PAS work around town and now we have to start paying it back. So that's brand new. Um and then coal increases amount to about 16 $15,000. And we are one of the lucky towns in the regional school system. U most of the
other towns are dealing with six figure increases. Um we are very fortunate. We we do pretty well um in terms of financial need from the state. We do a little better than the other towns, but it's really this number uh is driven by population and our enrollments um are
just decreasing relative to the size of the decrease enrollments in the other towns. Um so essentially we looking at a $700,000 increase year-to-year on our operating budget and that's the 9% that AJ had mentioned to you. Um so AJ, could
you do me a favor? Line 31 to the left if you could uh hit that plus sign. Yeah. So to to figure out the tax impact now that we know we need to raise $700,000 in additional revenue, we take a look at
where um that 7003 is going to come from. And we know that for the tax levy, it increases 2.5%. The levy limit, the amount of money we're allowed to to raise from property taxes to fund the operating budget, that increases by 2
and a half% every year. Um, and so that's 168,000. The other increase to that is debt exclusions. Any debt excluded items that are added to the budget will increase the tax levy. That 19354 will decrease.
Well, it's going to increase because of the regional school portion. The library building portion will decrease each year as the balance on principal goes down. The interest uh costs will go down. But debt exclusions, 2 and a half limit, and then new growth
are the things that increase our tax levy. And new growth, um, the assessor's office right now does not see any reason to any reason for optimism from our point of view. Um, they're using a very conservative number, the most conservative number we've ever used, because there's just no signs of new
building in town. Um, the utility companies still need to be talked to and looked at. there's a possibility that if they're doing any work, we could uh see some new growth there. So, um so far those are our those are three revenue items. We're estimating um our local
receipts will be higher by 35,000 36,000. I skipped state aid. We're looking at 41,000 increase there. Um overlay, I'm not going to get into it too much, but there's an adjustment there. Um, last year we funded the budget with $139,000 in cash reserves.
To start this budget, we were assuming no cash reserves would be used. So, what that means is if you add up 23 through 29, rows 23 through 29, we have $313,000 in new revenue in the tax levy with tax
levy limit in the tax levy. And so we would need to use basically increased property tax levy by $390,000 to balance the budget. And it's that increase of excess levy capacity is
really what triggers the 8 I forget what the number was. 8 >> 51 >> 51. Thank you. 851. It's changed so many times. um the 851 average single taxpayer tax increase from FY26 to FY27.
So um excess levy capacity 387. Now the next section is our total le levy estimate. So this is just taking some of the information from above and processing in a different way to calculate the tax
impact. So, our tax levy this year, the limit, our tax levy this year, the amount of money we're raising from property taxes to fund the budget was 100 uh 1 6.1 um million. Excess levy capacity to
balance our budget, we add 390. And then, of course, those increases we talked about at top, the uh levy limit, debt exclusions, and new growth. And we're looking at a tax levy of 6.9 million. Um we're assuming that values won't increase this year in property. We
know that's not true, but we need to be conservative because we found in the past that um other factors affect the tax rate, the tax impact and they're not always easy to measure and um it is the most conservative thing to do is to use
the same property values that we're currently using. So row 38 is our estimate tax levy to balance our budget. If you go down to sections um called forecasting FY27 average single tax bill
row 45 in column C, you'll see um the bottom line there 851. And so that's basically taking the levy that's on row 38 dividing it into the excess into the assessed values of the town and you get
a tax rate. Average single tax value is 418,000. our tax bills would be 7,621 for our average single family home and that is current year currently this year that's 6,700. So that's the problem we're facing. And
now um AJ talked about the options we have of uh applying some cash reserves to this operating budget and cutting some lines. And row 39 4041 you can see the two um categories that AJ discussed.
When we subtract the amounts that we came up with with the work we've done so far from the 6.9 million tax levy, we now bring it down to 6.6. Column D on the right right side of um
yes, the after adjustments, I'll call it. Um you can see our single tax bill would be 7,313, an increase of 543 versus the 851 based on what we've done so far. So, um we can probably AJ uh look at the
considerations and show everyone how we came up with $280,000 in tax um in low in lower levy. And so here you can see we the two categories row six through row nine are
>> before you walk through that I I see Rita has her hand up. Let me see if there are any questions before we walk through these. Yeah, I just had a um a question as to um you said the average single family tax bill is increased with the lower
amount in the $500 range. What is the valuation? What is that? What is that average value? >> That's that's based on an average single family of $418. >> Okay, thank you. Yeah, we're again as I said earlier, we're using the same
values as this year um because trying to estimate those increases for next year gets tricky. And if we keep this year and last year's calculations on the same base, then we get an accurate increase amount, a fairly accurate, you know, we
we need to think of these numbers more in ranges. It's 851, but it could be anywhere from 830 to 860. Um because when the assessors take everything, the budget that was approved, the final cherry sheet that will be determined well after town meeting, the other
sources of revenue that come along or change, it's going to all impact these estimates. So cash reserves applied. Basically, what we decided to do um at this point in time was we know that the total the
total cost of the outplaced students at the elementary school is over $200,000. I believe it's $224,000. And so we decided we're going to fund 50% of that. That particular item um outplace district um outplace um out district
placements is one could argue not a full permanent expense and will decrease in the future as the student population demographics change, if you will, as students who need these services move to the higher
grades. Maybe some will come in, maybe some won't. This is this 224,000 is the highest we have ever we have ever seen. Um, and we have had spikes in the past. So, basically, we're going to manage this spike by funding half of it with cash. And it's based on it's broken
between the two lines. the actual outdist placement, what we paid the school district that the children will be going to and the transportation to get them there. And then the third item is um this this concept that AJ mentioned easing, you know, spreading the cost of the large health insurance
increase over a number of years and instead of letting it all spike in our operating budget in one year. So basically this year's increase of 148, we just threw 50,000 at it, calling it a third. um we might tinker with that, but that's the other item. We also decided
that um we would fund OPED uh at $25,000 and we would use cash to do that. So, we're going to use $25,000 towards OPED. And then there are some new costs associated with the library building uh in town. So, we thought we would just apply a little cash to those to ease
those costs in. So, you can see $194,000. That's a very large number. we have it. Um if we spend this much money out of our um free cash reserves, we would still have a reasonable free cash
balance to manage any unforeseen costs in the future. Capital Planning has not approved um all the items they've received yet, but um they'll be voting at their next meeting and probably, you know, we can
assume we'll be approving most if not all and we'll have to consider how to fund those and how that will affect cash. So the cash number is still something, you know, we we are not settled on. And then the other actions are are the cuts as AJ was talking
about. The first cut would be in the library debt. We're working AJ has been working with the treasurer um trying to um we really would like as a committee I think we've agreed that a 10-year note
is lower interest cost to the town. A 15-year note is lower tax impact on the taxpayers each year. It would lower the amount of principal payment essentially and spread it over the the principal payment over 15 years. and and I I won't
get too deeply into it, but you want to you want to apply debt at a length that aligns better with what you're um funding financing. You wouldn't finance a car for 30 years, but a house for 30 years makes sense. So, we wanted to get it more aligned with the
um library. And again, as I mentioned, by lowering by going 15 years, it lowers the principal and that lowers the tax impact. It also spreads that tax impact to people who will be moving into town in future years. you know, those of us here for the next 10 years will be contributing to this. Many of us have
contributed prior to this year through um the fundraising that's happened. So, it allows other people to you, you know, it it kind of provides some equity. Okay, enough about that. So, um lowering the OPED from 50 to 25 means that we
also have a cut. And so, not only do we have the 25 pickup on row 8 on the tax levy by using cash, but we're also lowering um OPE to to 25 to 50 uh 225 from 50. So, that's a 25 saving. And then um we're going to be meeting with
the town um building committee. Uh our experience is they have some funds available and they have not been spending at the 40,000 level that we started with with the budget. that brought us to the 851. So, we just cut
that back by 20. So, the total impact of everything, 194 cash applied, 85,000 decreases in operating lines that we originally started with brings us to $280,000. That equates to about $38 on the average
single tax bill. >> Super. Thank you, George. Um just a couple of um >> just min minor things to just add to what we went through. So that outofd district placement that George talked about. Um one of the things that's
different about that placement this year is it's a um it is a private school that is um providing those services. So um that's partially explaining why that
single student um increase is is so significant this year. So there's I wanted to mention that and then uh there was one other thing. Oh, I think one po I think the reason
why I think the fincom felt comfortable reducing our annual contribution to the OPED fund this year from 50 to $25,000 is that the fund I think it's fair to say has performed um well in terms of
the interest income that it's earning and so uh I think the fund is in better shape than it might have otherwise been in given the uh the economic climate that that we're in right now. So, we
felt comfortable doing that at least for for this year. Okay. Uh we've we've dumped a lot of information on you all um in the last uh 30 minutes or so. So let me stop and pause for questions,
comments, reactions, suggestion, anything, anything you want to share. Uh, and let me stop sharing stuff. And please just use the the raise hand um feature and I can call on you. And if if you know other FinCom members um
actually while people are thinking about questions Cuy do you want to talk a little bit about the the advocacy work that is um that is in many ways addressing the problem that we're we're dealing with in Shootsbury but like pretty much all of our neighbors are as
well. >> Yes. I'm looking where am I am I can you hear me? >> Yep. >> Okay. Good. I can't see my square. Um, as I said, and this is from somebody
else as well, we have a funding problem, not a spending problem. And when the governor announced her budget, she was proud to say that she was not raising state taxes. But because the costs are going up, they are indirectly raising
local property taxes because they are not funding us um to help us deal with inflation and other issues um uh federal federal a grants being cancelled. We're
experiencing that, too. And so, um, we don't have to get elected. We're not on a campaign trail. Um, so we're not proud to, uh, we're not saying that we do not have to raise taxes. We, in fact, do. Um, so, as you can see from the numbers,
we're trying to get that number down. But, um, we can advocate for state aid. Rural aid for schools has been promoted by the state since 2017, but they are
not coming through with that money. Um on the week of March 9th through 13th, there's um a group of people who are organized to do actions across the state. I collected a hundred um postcards and we sent them to the
governor. Now, the uh joint house and senate committees for ways and means has the budget. They're wrestling with it. Um they hope to have something come out in midappril. But if they do not tackle
the $60 million that are supposed to be in rural aid, we will have missed yet another opportunity to get ourselves on better footing. um that 60 right now the governor's proposal is 20 million and
she is proud of herself for getting it up over the 12 million after they cut it last year by 25%. When a bud when a revenue line is cut by 25% it dr it makes a big hole in our budget. So, we are working to get the
state to respond to this issue um and get the $60 million which is shared across 109 towns to deal with the rural aid inequities of the current um funding formulas. So, um the school is going to
do an action. I'd like to help figure out an action for the highway, fire, police, and town hall because all the areas of our budget are affected by the lack of rural aid when they don't support our schools. So, um I hope that
people will join me and as we figure out what those actions will be, but it will be during the week of March um 9th through 13. Thanks. Right. >> Thanks, Susie. Okay. Um,
Anna, >> I just um I wanted to uh plus one on Susie, but also just let you know that I will be participating in the Massachusetts Association of School Committees Day on the Hill on March 30th
to also advocate for school funding. But also, you know, anything that you can do like writing um I mean it I feel like the people who are who are writing are already doing a lot of fighting for us, but I I think
additional reminders of rural aid and getting more money for Western Massachusetts um is very helpful. and just continuing to tell our representatives and um
senators that we support them and that we encourage them to fight harder. Um they need to hear that support. Ellen. >> Yeah. Thanks to the local newspaper, I just caught the fact that our select board has voted to send a document to
the legislature about raising our pilot for quab for for the Quabin Reservoir, which as we all know is grossly underfunded compared to the same amount of acreage or what per acre that the Boston area gets from the state. you
know, it's basically they've totally ignored us. Why? Because it it's not developed land. Well, we're still providing fire. We're providing police and things like that and they seem to want to ignore it. So, I did hear from uh Mindy Dom. I was at a meeting with
her not long ago and she did indicate to someone that not a very good chance of of them giving us more money, which is like thanks a lot. But anyway, uh you know, that's of grave concern because we don't get anywhere near what we should get for that for that property that they
keep getting more and more of. It's not like it's a constant amount. They keep managing to find ways to get more of it. So, my comment >> Thank you. Any other thoughts, questions, comments? Eric,
you're muted right now. Yeah. Sorry, I shouldn't I shouldn't be doing this. Uh I my my first my question was just what what will after all your applied uh use of free cash in this budget? What will
our cash reserves be? Um you know both short-term long-term what will our cash reserves look like? And the second question is what do we ins what do we think health insurance is going to do over the future years? I mean is it going to be like this where every year we're going to get these huge increases
or anyway and thank you Alan for the shout out. I do hope it works but I don't think it will. Um, okay. Uh, let let me answer your question about cash reserves, um, and
what these steps um, are how they're going to impact our cash reserves. And, and while I'm doing that, I know I see Ryan is in this meeting. I'm wondering if if he might uh if I could turn it to you then to talk a little bit about sort of health insurance issue and kind of
what you're what you're hearing and thinking about the sort of long-term uh um trends of in terms of our health insurance costs. So, uh let me I'm just going to access a sheet that I have.
All right. So, um I'm going to caveat what what I'm about to say now, which um by saying um the the the as George mentioned, the capital planning committee has not um
formally um uh voted on the various uh capital requests that have been made for this year. So, I'm going to give you some numbers that assume that all of the items that are under consideration right
now by the capital planning committee um are ultimately recommended and brought before the town at town meeting and then are approved there. U but obviously that's that's a big that there's some big caveats. So,
our cash reserves kind of coming into FY27 um include about $1,40,000 in free cash and about $433,000 in stabilization funds.
Now, we have um kind of a a fiscal policy for the town which recommend that was developed maybe seven or eight years ago, something like that. Um, and those guidelines recommend that
the town maintain 10% of its operating costs in free cash reserves and then 5% of its operating costs in stabilization funds. Okay. So, um, I can tell you kind
of coming into FY27, uh, let's see. Um, we have about our free cash reserves represent about 12% of our operating costs and our stabilization funds
represent about 5% of of our of our capital, sorry, of our operating costs. So, so those are those put us I mean we're we're entering FY27 in a pretty good position as far as the amount of cash reserves that the town holds. So
assuming about um $134,000 worth of capital requests, which again very I I can't emphasize enough that I have don't know that this is what's going to happen, but but at least under
consideration right now are about $133,000 worth of of capital requests that impact FY27. There a couple big ticket items that are being discussed that will come into play in future fiscal years, but
for FY27, we're talking about $133,000 worth of West assuming all of those th that gets ultimately recommended by the capital planning committee gets put before the town in town meeting warrants
and they are approved by the town. um and we take m we make the adjustments that um George and I have talked through tonight. That would leave us with the same level of stabilization funds. So
$433,000 and would leave us with about $717,000 in free cash reserves. that cash reserve amount would be under our 10% guideline. It would be about 8
and a.5%. But there's an important caveat which is there is a process every year where um line items in our in our budget. So for FY26 that were not fully spent will then be
that difference the amount that that wasn't spent would be returned to to our free cash. So I think it's fair to say that we would after that process happens we would still be at about carrying about 10% of our operating costs in cash
reserves. George, do you want to add anything to that? Oh, yeah. I just wanted to mention um as far as the capital planning committee and the items you you mentioned about $11314,000 worth of items that we're looking at, that does not include the items that would probably require borrowing. Um
which we have two very large items, three very large items. And um one of them well the reality is all of all three of those items would take a year. Let me let me just think about this. So
um two of the items are the parking lot repavement at the elementary school and the fire truck. And those are as you know very large items and too large to fund with cash. those we would probably need debt. But the other thing to for
everyone to note is that both of those items will take time. Ordering the truck, building the truck, delivery of the truck, and then debt service. Ryan can can tell you more about this. Usually is delayed into the next fiscal year. So neither of those items would
have a fiscal 27 impact. So that's one of the reasons why we're not including them in really any of our analysis as far as the operating budget goes. The third item is the greater and we're also the capital planning will be reviewing and um approving that some of that will
be I think in I'm not sure when the debt service would kick in for that or to what extent we can use funds in town. There is a grant that Dave applied for $250,000 which would cover a substantial portion of a new grader depending on
which one he decided to go with and there is a possibility that he could use chapter 90. Those two things combined might allow us to buy that truck without having any tax impact in any year in the future. Um Dave has um a pretty
substantial balance in his chapter 90 funds that he's received for the roads and he's comfortable using a portion of that for the greater. So just in case Lenny you are worrying about your worried about wondering about your fire truck for instance, we are looking at those other items as well. But the cash
items are really much smaller items. The largest is a $75,000 tractor and the rest are all under $15,000 each. >> Thanks. Um All right. So, Eric, I hope that answers your question about sort of
cash reserves and what these steps would how they would impact um our reserves. And then you had a question about kind of the the long-term outlook um terms of our health insurance costs.
Ryan, is there anything you're comfortable sharing um on that front? >> Yeah. Yeah, I'm happy to touch on that. Um, you know, obviously looking into the future is really hard and and really having a a exact idea as to what our health insurance costs looks like
honestly outside of 6 months from now is kind of nearly an impossible task. But with that said, I think you can safely assume that the costs for health insurance are just going to continue to increase at this point. The reality is is that the the rebound from COVID has
been substantially greater than I think anyone had ever anticipated. the overall um ser medical services like utilization and um prescriptions that are being written is just greater than they've ever seen in history along with mergers and acquisitions amongst hospitals are
just rising costs of hospital care so substantially that it's just causing a huge hiccups across the whole healthcare industry. Um the reality is that we currently belong to a a joint purchase
uh authority. A a JPA is what it's called, the Hampshire County Group Insurance Trust. They've had a really tough year financially. They're looking at their options um as far as rates and benefits go for the next year. We are also during this time we've been looking at our other potential options for the
town itself to see if there are any cost savings measures that exist. Um, we haven't had a ton of luck on that because the reality is is that this is an issue facing the entire healthcare industry. Um, you know, just for example, Blue Cross Blue Shield themselves had a $400 million operating
loss in 2024. Harvard Pilgrim Healthcare had a $200 million operating loss in 24. GIC, the states plan, had a $240 million, you know, quarter of a billion dollar deficit in FY25. So, the reality is is
that we aren't facing this alone. And I think it's it's safe to say that we're going to see this kind of this be um a trend of a challenge that we're going to face for the next couple years in in my honest opinion. I hope that somewhat answers answers
your question on health insurance. Yeah, I mean that that certainly tracks with kind of everything I read which suggests that at least in the the sort of short to medium term there's
no reason to think that these escalating costs are going to level out. Yeah. And um yeah, so I I I just I I I think I'm certainly not planning on that. Yeah,
just for perspective, a perfect example is, you know, I'm working with a company that's helping solicit quotes for insurance and you we could provide insurance through Bluec Cross Blue Shield directly uh just with us. We could kind of cut out the middleman of HCGIT for example, but like Blue Cross Blue Shield declined a quote. Harvard
Pilgrim declined a quote. We did get a quote from Health New England. They're really not a very strong um player in where we reside in where we exist. So, it's really not an overly attractive offering to our employees, but ju just
to give some insight, I I I think it's important that municipal um officials and employees and just the overall employees of the town know that we're not just saying because of the increases deal with it. You know, we are looking at what our options are. They're just nothing good is coming to the forefront
at the moment. >> Thanks, Ryan. Uh Susie, >> and I want to remind people that the 43% increase on our health insurance bill that also increased the co-pays for uh
the premiums for the employees. They also had a 43% increase in their part. And if they live in town, their taxes went up to help meet that. So, this is a um a service that has a lot of impact on the individuals and the families and
we're trying to maintain coverage for these people that serve us. Other comments and questions uh I there are a couple themes that I think were discussed in the handout. out that I shared that I we haven't really
touched on in any detail that I think I want to just make sure everybody's clear on. Um, one is about this issue of of excess levy capacity. Um, so obviously our sort of primary concern that we're trying to
that we're focused on right now is kind of moderating the impact of this budget um for taxpayers and their tax bills. But there's a related concern that we have which is that you know we
have relied on excess levy capacity in the last couple of years in particular to um avoid a um the need for an override because obviously our operating
costs and our tax levy is increasing uh greater than the two and a half levy limit. um allows uh you know um uh uh allows us to do without relying without utilizing excess levy capacity.
So um that's been an issue in FY26 where we used I think uh almost over $200,000 worth of excess levy capacity to fund that budget. Um, in this
preliminary budget, we would be even after these adjustments that we've discussed today, we would be utilizing uh, let me get the exact number about $151,000
worth of excess levy capacity. So, um, I don't mean I'm certainly don't mean to be alarmist about this, but I I do want to make sure it's clear to everybody that this is not a sustainable practice that we will eventually
run out of the excess levy capac if if we continue to have budget year budget years like the last two, we will run out of excess levy capacity. that won't be an option and we would be in that override territory to fund the kind of
budget increases that we've been dealing with in in the last couple years. That that would be the only um the you know the only way to accomplish these kinds of increases in the future. So, that is certainly something that is of concern to us and we're we're we're monitoring.
And um just to give just to put some numbers on it, um we had as much as let's see 863,000 worth of um of uh of excess levy capacity that we had
acrewed going into FY26. Um, if we take the steps that we've discussed today, um, and we use around $150,000 worth of excess levy capacity in FY27, that would
leave us with $466,000 worth of of levy capacity moving forward. So, the trend is clear. we're that we we will have um utilized almost half of our of of our excess levy
capacity over the course of two budget years with how things have unfolded um in FY26 and what FY27 looks like. Um and then you know I mean the the only other thing I wanted to mention is you know is that we
you know the fincom I think is is very concerned about the limited um opportunities for for new business growth new commercial growth in town. And this is why we're concerned about
it, right? Is that we we have the the structural problem in our budget that we've spent a lot of time talking about today. And because of the nature of our town, we have um we we have this
um uh reliance on state aid which is you know which is very flat and residential property taxes. we have very limited commercial
tax base and you know we you know the the it's I I know it's a controversial issue but you know we we've the you know the in recent years our um the sort of
prospects for for bringing new business development into town have faced um you know polit political challenges and uh ultimately were not, you know, we're not, the town was not able to pursue. And so this is,
I think, part of the context I hope we as a town consider as future opportunities come to us and we're having to um to negotiate and and think about whether we
whether the town is interested in taking advantage of those opportunities or not. like this is this is an important part of the context for those those discussions and um I think it's important to just acknowledge that. So that's that. Um any other sort of
thoughts, comments, questions? That's pretty much what the FinCom has sort of prep was prepared to talk about today, but again we're we're happy to field questions um and and hear your thoughts, suggestions, and and concerns.
Okay. So, as I said, you know, we're going to continue to work on this budget. It's it's um things will change because we're getting, you know, additional um estimates both terms of revenue and costs. You know, I think we're close,
but we're not we're not there in terms of having a complete picture of every line in our budget. Like I said, we do have a bunch of placeholders in there. Um, so those things will be updated. The FINCOM is going to continue to have a conversation about the possibility of
making additional adjustments. I I person I'll just speak for myself. I personally would like us to get that um average tax bill increase to under $500. That's kind of a goal that I'm hoping
that the FINCOM can meet. But again, it's not it's not going to happen just on its own. We're going to have to make some tough choices, but we're going to have to make choices that don't that that are um that don't have an impact on service
delivery that um that is going to be detrimental to the town, you know, to to residents. So, that that's that's the that's the balancing that we have to do on our end. Um, I see a couple hands up. So, let me go to Anna and then Sizzy. >> Can you just remind me when capital
planning is meeting to discuss the proposed projects? >> Uh, Ellen, can you can you answer that? >> Oh, boy. >> Sorry. >> George, >> no, that's okay. Wait a minute. Let me see if I have it in my phone. George,
can you help? I know it's the beginning of March, but I'm >> March 4th. >> March. >> Thank you. I wasn't sure if it was the third or the fourth. >> And are there is there a lot of school projects on that list or is it >> the parking lot?
>> There are Well, of course, there's the side the paving of the of the of the road. That's a big one. There are the purchase rather than purchasing a new tractor, they have asked for two snowb blowers, which is a savings of a pro well over $25,000
for which we are very thankful. And uh what was the other one? >> Gym curtain divider. >> Oh yeah, the business with the to be able to split the gym the unit they currently have apparently doesn't work or doesn't work well. So that's I think
the two things. George, can you think of anything else? See, okay. Laura's shaking her head. No. So, good. That's the two >> that's the two things for the school >> or three things for the school. And, uh, you know, as George mentioned, the paving is definitely not going to get
done in fiscal 27. There's too much work that has to be done preliminary to even drying it. >> Yeah. Okay. Thanks. >> Yeah. Exactly what time it'll be, I have no idea. Usually when I do things like this, I open it up and say, you know, when I put the agenda up, it's uh, you know, this time to this time, we're
going to discuss these because I, you don't want to say you've got 10 minutes when you need 15. >> As you can imagine, >> thank you for your question, >> Susie. And the um other part of gathering everybody here so we share the
same information is to know that we need people to be um bringing a message to the people around them. Um and so how would you message this? We've done our best today. Um it isn't over yet, so we
can't make definitive things, but please talk to other people. let them know what um issues the town the town is wrestling with, the budget is trying to address. And um if you have any questions, ask us so that we can get the message out to
other people. This is one of the times we really need a lot of um citizen information and citizen support as we work our way towards the town meeting and as we lobby for um funding
from the state. >> Absolutely. Uh and I just on that front I I want to thank uh you you probably have noticed that the fincom I think has done a much better job this year of sort
of community engagement and information sharing. That's not by accident. That's because um Susie and Laura Soto from um the Fincom have have um taken um an important step which is
sending updates on sort of our fiscal related discussions and issues. And so yeah, as a committee, I think we're we're trying to do a better job of of not just engaging you all but but engaging residents in our work. So
hopefully you've noticed that. Uh George. Oh, you're muted, George. Something that we're all aware of and and I think everybody has learned from this meeting is we're trying not to cut budgets. Um the committee has talked about, you know, the operating budget
and what it takes to run the town. We talked about how we started at that point and we're now to now at a new point on the tax levy, but you notice we really didn't cut back too much on services. I don't think anything. And so I just want to mention, you know, a lot of towns the only answer is and a lot of
people ask to cut costs and we're we're not comfortable doing that at this point. We don't think that the department should be suffering. We don't think the running of the town should deteriorate based on our current situation. in the long run it may not be sustainable but we're certainly going to
fight that right now um and you know as a committee try to come up with uh innovations and use our imagination to try and and save save um the committee I'm sorry the departments from having to cut budgets and from the services again I'm being a bit redundant but um just
want everybody to know that we've had that conversation it's one of the reasons why we are you know concerned about the lack of growth and where are we going to get funds in the future? Um the chapter 70 for two decades really
chapter 70 the education aid really helped us with our operating budgets and allowed us to build excess lovy capacity where we didn't need to tax to the full limit that we could have and the formula is based on enrollments and you know
enrollments have been going down. So our chapter 70 funds have not been going up while all our other costs have gone up and and that's how the state chooses to fund municipal budgets is through the help with the education with education costs because education for rural communities like ours is over 60% of the
budget. And so that's a key factor as to why we're here. Uh we can't guarantee that in future years we are running long range projections. We put together a long range plan. I won't call it a plan, but just long range forecasting out to the next five years. What if this
happens? What if that happens? It's not a pretty picture. So, you know, we don't know how long if things don't change, we can go without looking for cuts at, you know, uh in many of the departments and obviously the large departments would
have to be affected, but we are going to fight that right now and I just want everybody to, you know, be aware of that. >> Great. Uh, Ellen, >> I just want first of all to thank the FIN cop for all the work they're doing. It's a I'm sure it's very tedious and
very difficult and you're making some very hard decisions and we very much thank you for all you're doing. I'm sure you know you lie awake at night worrying about these things and yeah, Susie says yes and uh that's not fair to you. So, please just
know we appreciate it very much. And another question that has nothing whatsoever to do with this meeting. Haley, do we have trash collection tomorrow? >> Trash collection is delayed by one day. >> Thank you. >> Thank you. That's what I thought, but I wanted to check. >> Yeah,
>> thank you. >> Um that reminded me obviously our highway department could not participate in this meeting today. So, uh, I just want to let people know that this is being recorded and so, um, uh, I'm sure
Brennan can make the, uh, the link available, uh, for folks who want to be able to see this. So, if you have colleagues that, um, that need that need this, that, need to watch this or would want to watch it that couldn't attend,
it'll be available. Okay. Um, all right. I think, uh, that's pretty much it. So, um, please don't hesitate to reach out if you have questions or
comments. You can email the fincom uh at fincom sheets.org. And um you know we we can always uh come to a fincom meeting as well and and share any thoughts or concerns or
suggestions there as well. So um we'll keep >> before you call us to conclusion can our various committees get out of the meeting too please? >> Yes. >> Okay. Uh could I have a motion to uh close close the meeting from the capital
planning? >> So moved. Right. Okay. Where's Laura? >> Second. I second it. >> Okay. All all three of us in favor of course. Okay. So, our meeting is
adjourned at 4:16. >> All right. Uh and I will make a motion to adjourn the fincom at 4:16. >> Second. >> All in favor? >> I
Skine eye >> moss eye. >> All right. So the fincom is adjourned. Select board need to >> uh Erica is gone. So >> I'll adjourn the meeting my one and only. >> Okay. >> Great.
>> All right. Well, thanks everybody for for taking the time on this snowy day. Uh really appreciate it. And I also want to thank everybody for um yeah for for it was it was very evident in the fincom that you all um approached your proposed
FY27 budgets with a lot of consideration about the challenges that was that was not unnoticed by by the FICOM. So um appreciate all of that work. Okay, thanks for joining us everybody. Appreciate you all.
>> Bye. >> Take care.