Below, see the text of my letter to the community regarding my first budget, as well as the text of my FY 15 Budget Summary. If you have any questions, concerns, or input, please don't hesitate to contact me.
Have a great weekend!
Ken
P.S. I hope you will join us at 2 PM on Sunday, May 18, for the Dough Boy rededication ceremony at Amesbury Middle School. The Amesbury Veterans' Memorials Restoration Committee continues to work very hard to restore our monuments. I am grateful to see such dedicated volunteers in our community.
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Pursuant to Amesbury’s
charter, I am pleased to submit the Fiscal Year 2015 operating budget. The budget was prepared in consultation with
the Chief Financial Officer and the heads of divisions and departments.
This FY15 budget represents
my first since receiving the honor of being elected as your new mayor. As such,
it represents my effort to move Amesbury toward solving its most pressing
problems. For many years we have faced
two very large and very challenging financial problems in Amesbury:
- Enormously
high and ever increasing property taxes.
- Consistently
underfunded schools
These are deep problems with
no easy solutions and neither problem can be solved by itself without
negatively affecting the other.
For example, fully funding
the school administration’s level services spending projection could only
happen if we were to raise property taxes. Not only would such a move make our
property tax situation worse, home values would be negatively affected and
seniors, those on fixed incomes, and people struggling financially would
suffer.
On the other hand, actually
reducing property taxes would require unacceptable cuts in services, especially
schools, but additionally in public safety, road maintenance, social services
and economic development. Neither of these scenarios is acceptable. Therefore,
my long term plan is as follows:
- Decrease the rate of
increase in property taxes while maintaining or improving municipal
services and meeting previously contracted financial obligations.
- Invest in education,
with the majority of our increased tax dollars going to our schools. We
must strive for excellent schools, but not to the extent that we dig
ourselves deeper in the property tax hole.
- Focus our efforts on
initiatives that will result in expanding our commercial/industrial tax
base so we can raise much needed revenue in the future without further
burdening homeowners.
To this end, the FY15 budget
focuses heavily on schools, with the majority of new spending going to
education. Moreover, even with substantial
increases in personnel related contractual obligations, the proposed tax levy
increase is at a rate is slightly less than last year’s increase. We are able
to accomplish this in no small part because most of our municipal department
heads have been able to rise to my challenge to find creative ways to reduce
department costs while maintaining or improving services.
This budget is the first step
in what will be a long term solution. It’s taken Amesbury many years to get
into the position in which we find ourselves and it will take time to dig our
way out.
This budget is an initial
step in the right direction towards improving the quality of life for all our
residents and relieving our future tax burden.
Sincerely,
Mayor Ken Gray
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Budget Summary
Overview
The proposed FY15 general government operating budget is
$53,863,035. Spending is proposed to increase $1,426,771 from the FY14 adjusted
budget while revenues from sources other than the real estate tax levy are up by
$436,209.
The result is an increase in the property tax levy of
$990,562. While property taxes will increase with this budget, they will
increase at a rate slightly less than that of last year.
Expenses
The single largest component of FY2015 spending increases is
the cost of meeting obligations resulting from legacy contracts negotiated with
our union teachers, police, firefighters and office workers. This is followed
by increases in debt payments due to financing capital projects such as the DPW
buildings and the Fire Station.
Specifically, of the $1,426,771 total increase in the
requested budget, contractual salary related obligations account for
approximately $800,000 and debt service increases make up an additional
$311,240.
By department, of the $1,426,771 increase, $878,255 is for
increases in education, $311,240 for increases in debt, $200,108.00 for
increases in public safety, and $95,000 for increases in payments for veterans
assistance. These departmental increases are offset by a reduction in expenses
for the total of all other city departments of $57, 832.
Schools
On April 1, the School Committee voted unanimously to adopt
the School Administration’s proposed budget that represented an $800,000
increase over the FY 14 appropriated amount. This amount is in line with my
recommendation and is consistent with Amesbury’s historical school spending
increases. In spite of this we are still facing the possibility of cuts in
school services. This is because, like many other Massachusetts
District school spending is budgeted at $28,148,496. This
amount represents 52% of our general government expenses. In addition to
district spending, the state assesses Amesbury an additional $3.2 million in
education related costs, or an increase of $78,255 over FY14. This includes:
School Choice out $456,000
Charter School $576,000
Retired teachers $1,165,000
Including these assessments, total educational spending is
$31,415,000 or about 58% of Amesbury’s total general government spending.
Revenue
Total revenue is projected to increase by $436,209. Of this,
state aid is estimated to increase by $269,482 to $11,798,022. Revenue from our
Ambulance service is up $80,000 while other miscellaneous revenue is up by
$86,727, including an estimated increase in the meals tax of $50,000 to
$175,000, and an estimated increase in the hotel tax of $13,000 to $95,000.
Summary
Over 70% of our total municipal costs are personnel related,
including salaries and benefits. FY15 is the third year and largest percentage
increase of our three year contracts with the city’s union workers. As such
these cost increases have, by far, the largest impact on the budget numbers. In
addition, we are beginning to see the costs related to legacy capital
improvement decisions.
In spite of these challenges, we have managed to hold tax
increases to below those allowed by law. But these are short term reactions to
long term problems. Going forward we must solve our school funding problems and
revisit the way we manage our municipal expenses. I am confident that we can
accomplish that and I look forward to the challenge.
