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HomeMy WebLinkAbout2010-01-09 Board of Selectmen PacketOverview for Board of Selectmen - FYI 1 Budgets Jan 9th 9:00am 9:15am 9:30am 10:OOam 10:30am 11:OOam 11:30am Jan 16th 8:30am 9:OOam 10:OOam 10:30am 11:OOam Budget Overview Town Manager Community Services Police Dispatch Fire Accounting Finance/Board of Assessors Public Works Library/Library Trustees Benefits/Capital/Debt Budget Summary 2 TO: Board of Selectmen From: Peter 1'. Hechenbleikner, Town Manager Date: Friday, January 08, 2010 Re: FY 2011 Budget Guiding Principles • Avoid Gimmicks; • Maintain necessary levels of Public Safety and Public Health; • Maintain necessary levels of local services to assist those in need during difficult economic times; • Retain the ability to take advantage of opportunities, • Retain the Town's strong financial capability; • Maintain the Town's ability to emerge from the current economic circumstances in a strong position (Economic Development); • Understand and respect the impact of local government decisions regarding increasing costs on our residents and taxpayers; • Explore short and long range efficiencies, regional opportunities, organizational changes, and outsourcing of services; • Determine what things we are currently doing that don't add value to the community, and what changes (state law) need to be made to avoid doing them; • Request "early retirement" legislation that the Town can tailor to its needs. Common Assumptions. Capital and Debt Service will.remain at 5% of the budget; • 0% increases in salaries from 6-30-10 levels for FY 2011 Fees/Revenues Generally we would not recommend major changes in fees. to address the budget shortfalls, but there are several areas that we could consider: • Smoke Detector Fees - ours are very low; • Underground Storage Tank registration fees - ours are very low; • Site plan waiver fee - new; • Broader use of re-inspection fees for more than the initial inspection and one re-inspection; • Meals Tax • Consider un-bundling the Community Access fee o Commuter parking - our fees are very low o Compost center • Page 1 3 Town of Reading: Financial Forecast as of December 3, 2009 FY10 FY11 FY12 FY13 Projected revenues ($000s) 69,192 68,894 70,008 71,408 annual change -0.4% 1.6% 2.0% Accommodated Costs* $ 24,747 $ 25,252 $ 26,813 $ 28,422 2.0% 6.2% 6.0% *Benefits, Capital, Debt, Energy, SPED out of district, Voke, Insurance, etc.. .r i 'iA1 xi: ; , .s .4 3C.. rF 3 Left for wages & expenses $ 44,445 $ 43,642 $ 43,195 $ 42,986 Schools & Facs. 70%; Town 30% -1.8% -1.0% -0.5% Wages/expenses +0% 44,573 44,573 44,573 44,573 Annual Surplus(Deficit)' (128) (931) (1,378) (1,587) used free cash in FY10 Option - cut expenses & wages (layoffs?) Target budget 44,573 43,642 43,195 42,986 Annual cost reductions (931) (447) (209) -2.1% -1.0% -0.5% Steep cuts in FYI 1; additional cuts for two more years Option - use reserves Reserves Used $ 931 $ 11378 $ 1,587 Reserves Left (min $3.5mil) $ 6,840 $ 5,909 $ 4,531 $ 2,944 Reserves at minimum in two years; 6% cuts needed if FY13 to maintain minimum reserves of June 30, 2009 the Town of Reading has $6.8 million in available reserves. This d is well within the FINCOM guidelines of a minimum of 5% (or $3.5 million) at all es. Note that the reasons for such a minimum include unpredictable mid-year senses (such as snow & ice removal) and/or unforeseen drops in revenue (such as rtfalls in state or federal aid). .erefore as much as $3+ million in reserves could be available to help the general fund dget during these difficult economic times. The trick is that you can only use a dollar reserves to pay for a dollar of recurring costs for one year.. If we knew when the Dnomy would rebound (especially state aid), then we would know how long we needed rely upon our own reserves. History suggests that period of time will be longer than =e years. ;uming a zero percent change in wages and expenses for the town & school in FYI 1, still are faced with about a $1 million shortfall. Assuming a second year of zero nges, we would need an additional $1.4 million in FY 12 to balance the budget. -refore in three years - and at difficult zero percent budgets - we would draw down ,rves to below the 5% FINCOM minimum levels, leaving less options available for next few years. 4 wages 0.00%, F 0.00% Town of Reading expenses 0.00% 0.00% Budget Summary One Year One Year One Year 118110 3:45 PM Projected Changes Projected Changes Projected Changes No. FY - 2010 FY - 2010 FY - 2011 FY - 2011 FY - 2012 FY - 2012 avenues A General Fund Revenues $ 72,388,015 1.0% $72,140,221 -0.3% $73,253,502 1.5% Total Property Taxes Al 49,542,619 2.2% 51,096,967 3.1% 52,572,225 2.9% . A2 Total Other Local Revenues 5,809,950 -10.9% 5,398,000 -7.1% 5,398,000 0.0% A3 Total Intergov't Revenues 13,482,109 -2.6% 12,226,594 -9.3% 11,889,617 -2.8% A4 Total Transfers & Available 3,553,337 26.3% 3,418,660 -3.8% 3,393,660 -0.7% Ear-marked revenues 3,196,475 -1.4% (3,245,683) 1.5% 3,245,683 0.0% Debt Exclusion (2,108,170) -24.2% (2,086,657) -1.0% (2,086,657) 0.0% MSBA (1,088,305 135.5% 1,159,026 6.5% 1 _ 1,159,026 0.0% A98 Revenues before CashlSav. $ 69,191,540 1.2% $68,894,538 -0.4% $70,007,819 1.6% A5 Free Cash 223,805 -100.0% 0 0 0.0% A6 Savings 0 -100.0% 0 0.0% 0 0.0% A99 Net Available Revenues $ 69,415,345 0.7% $68,894,538 -0.8% $70,007,819 1.6% 5% for debt + capital 3,459,577 3,444,727 3,500,391 CCOn1nf90 a ed Osts B Benefits 10,951,082 1.1% 11,642,434 6.3% 12,421,472 6.7% C Capital 1,155,725 77.6% 845,686 -26.8% 1,031,512 22.0% D Debt 2,519,152 -3.7% 2,918,776 15.9% 2,796,607 -4.2% E Energy 2,472,121 -1.7% 2,402;023 . -2.8% 2,522,124 5.0% F Financial 620,000 -32.2% 611,000 -1.5% 627,800 2.7% G Education - Out of district 3,866,848 27.2% 3,747,751 -3.1% 4,143,439 10.6% H Education - Vocational 360,100 -15.1% 309,855 -14.0% 325,348 5.0% J Miscellaneous 2,768,631 2.3% .2,852,771 3.0% 3,012,229 5.6% K Community Priorities 28,172 -22.0% 125,000 0 L1 Annual Accommodated Costs $ 24,741,831 4.2% $25,455,295 2.9% $26,880,530 5.60% M1 Extra Capital 0 -100.0% 0 -100.0% 0 -100.0% M2 Stabilization Fund 0 -100.0% 0 -100.0% 0 -100.0% 12 Net Accommodated Costs $ 24,741,831 1.2% $25,455,295 2.9% $26,880,530 5.6% Operating Costs OC1 Municipal Government 13,778,012 13,778,012 0.00% 13,778,012 0.00% OC School & Bldgs 30,807,044 30,807,044 0.00% 30,807,044. 0.00% OC School, Town, Buildings $ 44,585,056 $44,585,056 0.00% $44,585,056 0.00% Municipal Government 30.90% 30.90% 30.90% School & Bldgs 69.10% 69.10% 69.10% TOTAL EXPENSES (L2+OC4) $ 69,326,887 $70,040,351 1.0% $71,465,586 Surplus/(Deficit) • $ 88,458 $ (1,145,813) ~ t'!,451,1nf) A Town of Reading Revenues - Details One Year One Year One Year 118110 3:45 PM Projected Changes Projected. Changes Projected Changes No. FY - 2010 FY - 2010 FY - 2011 FY - 2011 FY - 2012 FY - 2012 Property Taxes Tax levy (within levy limit) 47,519,656 3.7% 49,274,826 3.7% 50,762,946 3.0% New Growth 553,345 -0.5% 250,000, -54.8% 250,000 0.0% Tax levy (debt exclusion) 2,108,170 -24.2% 2,086,657 -1.0% 2,086,657 0.0% Abatements and exemptions 638,552) -6.3% (514,516 -19.4% 527,379 2.5% Al Total Property Taxes E49!,542,619 2.2% 51,096,967 3.1% 52,572,225 2.9% Other Local Revenues Motor Vehicle Excise 2,500,000 -12.3% 2,300,000 -8.0% 21300,000 0.0% Meals Tax Penalties/interest on taxes 174,300 5.0% 175,000 0.4% 175,000 0.0% Payments in lieu of taxes 289,800 5.0% 290,000 0.1% .290,000 0.0% Charges for services 1,554,000 5.0% 1,550,000 -0.3% 1,550,000 0.0% Licenses & permits 131,200 5.0% 130,000 -0.9% 130,000 0.0% Special Assessments 3,150 5.0% 3,000 -4.8% 3,000 0.0% Fines 157,500 5.0% 150,000 -4.8% 150,000 0.0% Interest Earnings 600,000 -43.9% 400,000 -33.3% 400,000 0.0% Medicaid Reimbursement 400,000 0.0% 400,000 0.0% 400,000 0.0% Other A2 Total Other Local Revenues 5,809,950 -10.9% 5,398,000 -7.1% 5,398,000 0.0% Intergovernmental Revenue State Aid 12,177,581 -9.0% 11,427,581 -6.2% 11,427,581 0.0% Federal ARRA 842,443 336,977 -60.0% 0 -100.0% MSBA 462,085 0.0% 462,036 0.0% 462,036 0.0% A3 Total Intergov't Revenues 131482,109 -2.6% 12,226,594 -9.3% 11,889,617 -2.8% Operating Transfers and Available F unds Cemetery sale of lots 25,000 -33,6% 25,000 0.0% 25,000 0.0% Sale of real estate funds 325,000 -7.1% 300,000 -7.7% 275,000 -8.3% Reading Ice Arena Authority -100.0% 60,000 100.0% 60,000 0.0% MSBA payments 626,220 100.0% 696,990 11.3% 696,990 0.0% RMLD earnings distribution 2,186,670 1.5% 2,186,670 0.0% 2,186,670 0.0% Overlay surplus 390,447 . 157.4% 150,000 -61.6% 150,000 0.0% A4 Total Transfers & Available 3,553,337 26.3% 3,418,660 -3.8% 3,393,660 -0.7% Stabilization Fund 0 223,805 0 A5 Free Cash & Savings 77~:~ TOTAL REVENUES 72,611,820 0.58% 72,140,221 -0.65% 73,253,502 1.54% 6 Town of Reading A000m Costs - Summary One Year One Year One Year 118110 3:45 PM Projected Changes Projected Changes Projected C hanges No. FY - 2010 FY - 2010 FY - 2011 FY - 2011 FY - 2012 FY -2012 B Benefits 10,951,082 1.1% 11,642,434 6.3% 12,421,472 6.7% C Capital 1,080,725 66.1% 845,686 -21..7% 1,031,512 22.0% D Debt (net - tax levy) 2,519,152 -3.7% 2,918,776 15.9% 2,796,607 -4.2% E Energy 2,472,121 -1.7% 2,402,023 -2.8% 2,522,124 5.0% F Financial 620,000 -32.2% 611,000 -1.5% 627,800 2.7% G Education - Out of district 3,866,848 27.2% 3,747,751 -3.1% 4,143,439 10.6% H Education - Vocational 360,100 -15.1% 309,855 -14.0% 325,348 5.0% J Miscellaneous 2,768,631 2.3% 2,852,771 3.0% 3,012,229 5.6% K Community Priorities $ 28,172 -22.0% $ 125,000 343.7% $ - 0.0% TOTAL Accommodated COSTS $ 24,666,831 3.9% $25,455,295 3.2% $26,880,530 5.6% JA commodaatedr oss - etai B Accommodated Costs - Benefits 131 Group Health / Life Ins. 7,225,000 -0.4% 7,560,000 4.6% 8,164,800 8.0% OPEB 0 0.0% 25,000 100.0% 0 100.0% 62 Workers Compensation 246,050 -5.0% 300,353. 22.1% 315,370 5.0% 63 Police / Fire Indemnification 55,000 10.0% 57,750 5.0% 60,638 5.0% 64 Contributory Retirement 2,731,532 3.0% 2,893,456 5.9% 3,022,986 4.5% 65 Non-Contrib. Retirement 73,500 -4.9% 73,500 0.0% 73,500 0.0% B6 Medicare I Social Security 565,000 15.0% 607,375 7.5% 652,928 7.5% 67 Unemployment Benefits 55,000 10.0% 125,000 127.3% 131,250 5.0% B99 Total Benefits $10,951,082 1.1% $11,642,434 6.39/6 $12,421,472 6.7% C Accommodated Costs - Capital C99 Total Capital $ 1,080,725 66.1% $ 845,686 -21.7% $ 1,031,512 22.0% D Accommodated Costs,.- Debt (net i 5,765,113 vote th is line Debt Service - Principal D1 3,720,000 -0.9% 4,165,000 12.0% 4,185,000 0.5% . D2 Debt Service - Interest 2,045,113 -3.6% 2,014,003 -1.5% 1,867,421 -7.3% D3 Excluded debt (2,783,876) -0.5% (2,798,191) 0.5% (2,793,778) -0.2% D4 MSBA reimbursements (462,085) 0.0% (462,036) 0.0% (462,036) 0.0% D5 adjustments excluded premium D99 Total Included Debt $ 2,519,152 -17% $ 2,918,776 15.9% $ 2,796,607 -4.2% internal transfer from Energy Savings to pay debt service Available for Cash Capital (C99) $ 940,425 C+E Net included debt + capital 5% of ne 3,459,577 $ 319,730 $ 3L/,Ito 1,$ 845,686 $ 1,031,512 37444, 727 3,500,391 Town of Reading l Accom Costs - Detail_ One Year One Year One Year 118110 3:45 PM Projected Changes Projected Changes Projected Changes No. FY - 2010 FY - 2010 FY - 2011 FY - 2011 FY - 2012 FY - 2012 E Accommodated Costs - Energy E1 Street Lighting 230,000 1.5% 241,500 5.0% 253,575 5.0% E2 Heating of Buildings-Town 147,798 2.3% 141,000 -4.6% 148,050 5.0% E3 Heating of Buildings-Schools 788,870 -18.0% 760,000 -3.7% 798,000 5.0% E4 Utilities-Town 198,967 15.0% 201,000 1.0% 211,050 5.0% E5 Utilities-Schools 895,696. 12.1% 837,193 -6.5% 879,053 5.0% E6 Fuel - vehicles (in DPW budget) 210,790 0.0% 221,330 5.0% 232,396 5.0% E99 Total Energy $ 2,472,121 -1.7% $ 2,402,023 -2.8% $ 2,522,124 5.0% F Accommodated Costs - Financial F1 Casualty Insurance 320,000 -9.6% 336,000 5.0% 352,800 5.0% F2 Veteran's Assistance 150,000 50.0% 125,000 -16.7% 125,000 0.0% F3 FINCOM Reserve Fund 150,000 36.4% 150,000 0.0% 150,000 0.0% 14 Stabilization Fund F99 Total Financial $ 620,000 -32.2% $ 611,000 -1.5% $ 627,800 2.7% G Accommodated Costs - Education Out of district G1 Out of district SPED transportation 915,000 -1.5% 895,000 -2.2% 939,750 5.0% G2 Out of district SPED tuition 4,349,648 0:9% 3,894,751 -10.5% 4,089,489 5.0% G3 Out of district SPED rev, offsets (885,273) (709,292) -19.9% (885,800) 24.9% G4 Out of district SPED carry forward (341,365) G5 ARRA IDEA Funds (171,162) (332,708) G99 Total Education - Out of distr. $ 3,866,848 27.2% $ 3,747,751 -3.1% $ 4,143,439 10.6% H Accommodated Costs - Education Vocational School H1 Vocational School Assessments - N.E. 295,100 -25.1% 309,855 5.0% 325,348 5.0% H2 Vocational School Assessments - M. 65,000 116.7% 0 -100.0% 0 H99 Total Education - Voke $ 360,100 -15.1% $ 309,855 -14.0% $ 325,348 5.0% J Accommodated Costs. Miscellaneous J1 Rubbish Collection / Disposal 1,524,627 3.8% 1,560,770 2.4% 1,677,828 7.5% J2 Snow and Ice Control 500,000 11.1% 525,000 5.0% 550,000 4.8% J3 State Assessments 557,009 -6.7% 580,006 4.1% 597,406 3.0% Cemetery 186,995 -1.9% 186,995 0.0% 186,995 0.0% J4 Salaries and Wages 148,226 -2.4% 148,226 0.0% 148,226 0.0% J5 Expenses 38,769 0.0% 38,769 0.0% 38,769 0.0% J99 Total Miscellaneous $ 21768,631 2.3% $ 2,852,771 3:0% $ 3,012,229 5.6% FY10 FYI 1(1) FYI 1(2) Change(2) Town Mgr TOT wages $ 209,845 $ 214,075 $ 210,746 $ 901 TOT exp $ 474,000 $ 472,000 $ 472,000 $ (2,000) TOTAL $ 683,845 $ 686,075 $ 682,746 $ (1,099) Comm Svc TOT wages $ 798,530 $ 896,807 $ 871,087 $ 72,557 TOT exp $ 239,275 $ 240,485 $ 240,485 $ 1,210 TOTAL $ 1,037,805 $ 1,137,292 $ 1,111,572 $ 73,767 Accounting TOT wages $ 155,770 $ 158,864 $ 155,770 $ - TOT exp $ 1,550 $ 1,550 $ 1,550 $ - TOTAL $ 157,320 $ 160,414. $ 157,320 $ - Finance TOT wages $ 1,125,155 $ 1,160,359 $ 1,137,410 $ 12,255 TOT exp $ 517,300 $ 581,300 $ 503,300 $ (14,000) TOTAL $ 1,642,455 $ 1,741,659 $ 1,640,710 $ (1,745) FINC Reserves $ 150,000 $ 150,000 $ 150,000 Accomodated Public Safety Police wages $ 3,508,136 $ 3,541,722 $ 3,508,136 $ - Police exp $ 208,285 $ 208,285 $ 208,285 $ - TOT Police $ 3,716,421 $ 3,750,007 $ 3,716,421 $ - Disp wages $ 405,849 $ 413,589 $ 405,849 $ - Disp exp $ 41,639 $ 41,639 $ 41,639 $ - TOT Dispatch $ 447,488 $ 455,228 $ 447,488 $ . - . Fire wages $ 3,432,975 $ 3,482,746 $ 3,432,975 $ - Fire exp $ 103,930 $ 103,930 $ 103,930 $ - TOT Fire $ 3,536,905 $ 3,586,676 $ 3,536,905 $ - DPW DPW wages $ 2,336,104 $ 2,394,834 $ 2,351,314 $ 15,210 DPW exp $ 708,795 $ 786,061 $ 719,335 $ 10,540 TOT DPW $ 3,044,899 $ 3,180,895 $ 3,070,649 $ 25,750 Snow & Ice $ 500,000 $ 525,000 $ 525,000 $ 25,000 St Lighting $ 230,000 $ 241,500 $ 241,500 $ 11,500 Rubbish $ 1,524,627 $ 1,560,770 $ 1,560,770 $ 36,143 TOT DPW(2) $ 2,254,627 $ 2,327,270 $ 2,327,270 $ 72,643 Accomodated Library Lib wages $ 960,861 $ 980,082 $ 960,861 $ - Lib exp $ 259,337 $ 259,337 $ 259,337 $ - TOT Lib $ 1,220,198 $ 1,239,419 $ 1,220,198 $ - TOTAL wages $ 12,933,225 $ 13,243,078 $ 13,034,148 $ 1001923 TOTAL expenses $ 4,958,738 $ 5,171,857 $ 5,027,131 $ 68,393 TOTAL $ 17,891,963 $ 18,414,935 $ 18,061,279 $ 169,316 $ 72,643 Accomodated $ 96,673 Operating over Zero 9 Town Manager FY11 Budget A level funded FY 11 budget has been submitted as directed. To implement the guidelines of a level-funded budget will require the following: Town Manager salary - the salary shows a slight increase because the FY 2010 salary established by the Board of Selectmen was for a 2% increase on 7-1-09, and a 2% increase on 1-1-10. Therefore the FY 2011 salary is level funded from the rate. in effect on 1-1-10 Professional development - the budget as proposed eliminates the funds put into the budget a couple of years ago for Town funding of the annual ICMA conference Property and Casualty Insurance. This is level funded from FY 2010, assuming that there is no increase in coverage. The 0% increase is a result of contracting with MIIA last year for a 2 year contract. We do not anticipate adding buildings or vehicles, and. therefore a 0% increase should be adequate. 10 Community Services FY11 Budget Narrative A level funded Community Services budget will necessitate staff reductions that will result in a decreased level of services provided. The Community Services Department has been directed to develop a customer service action plan that enhances the level of service we currently provide. The plan to enhance services would suffer, and customer service would be further diminished. The reductions are a result of a zero balance in the building permit revolving fund which had been used in the past to fund two positions: (1) the Permits and Licensing Coordinator; and (2) Staff Planner. Without this supplemental funding source, both of these positions would be eliminated as of June 30, 2010. The amount of the reduction is $79,028. Background: Eliminating funding for these key positions is required due to the budget and structure of the Community Services Department. The Community Services Department budget is mostly salary. When the discrete service related expenses provided by Health, Elder/Human Services and Veterans (many of which are reimbursed by the State) are separated out, the budget is only 2% expenses, and a reduction of this scale must come from salaries. Impacts Staff Reductions to the Community Services Department Staff support to several boards and commissions will be reduced. This includes: the Community Planning and Development Commission (CPDC); Economic Development Committee (EDC); the West Street. Historic District; and the Historical Commission. The areas impacted include: Site Plan Review; Zoning Updates; Downtown Revitalization; Business Retention, Attraction and Development; Historical Review of Proposed Improvements in the West Street Neighborhood; and Historic Preservation. To the extent possible, a portion of the board and commission workload would shift to the Town Planner. The vast majority of the work could not be done because the Town Planner also manages the Community Services Department comprised of 6 divisions (planning;, inspections; elder/human services; health; conservation; and veterans services). The more advanced planning work such as 40R, rezoning, affordable housing and economic development could not be accomplished by the Town Planner. Administrative work related to these boards will shift to the Town Planner including: posting meeting notices; scheduling public forums; taking minutes; assembling packets; following up on inquiries and general planning matters; tracking progress on various projects; providing updates to the website; and many other staff level functions. The Town would be taking a step backwards without a Permits and Licensing Coordinator. The inspections division was cut in the FY10 Budget by one full time person (Assistant Building Inspector) which has placed more demands on the Building Inspector and the Permits and Licensing Coordinator. 11 The inquiries from the public would not be managed properly without the Permits and Licensing Coordinator. A single point of contact has proved invaluable when assisting customers with permitting and insuring that all divisions are included in reviews related to permitting. This is a very time consuming, concierge type service that is provided to the public, that is essential to providing good customer service. People at the counter would be lined up for an extensive amount of time, and in some cases, could be asked to come back another day or schedule time with the building inspector. Impacts to Reassigning this work: Some of the duties can be reassigned. The Building Inspector greatly depends on the Permits and Licensing Coordinator to process permits in a timely manner. The Town Planner relies heavily on the Staff Planner to coordinate and follow up on numerous planning related activities. The capacity of the Building Inspector and the Town Planner to pick up these duties is diminished by an already overextended workload. The loss of the positions will significantly impact the following areas of our operation: Customer Service - would have a serious negative impact as the level of service would be significantly reduced both in.planning and inspectional services; yielding an.inability to provide exemplary customer service. Inspectional Services - would be affected and delayed as follows: o Responding to inquiries; reviewing plans; assisting customers; issuing building permits; performing inspections; and issuing occupancy permits o Plan review and coordination under the current system of Development Team Review and within the Divisions of Community Services Department o Responding to complaints, violations, and other code enforcement efforts Town Boards/Commissions - existing staff support will. be greatly reduced/eliminated Planningg - Day to day staff level planning would be prioritized and more advanced planning work would be placed on the back burner 12 Police Department FY11 Budget Background: The Reading Police Department is personnel driven. The budget for the agency is 94% personnel and 6% expenses. The Police Department currently is budgeted for 40 sworn personnel, 3 civilian office employees, 1 civilian part-time Animal Control Officer and part-time Parking Enforcement Officer. To implement the guidelines of a level funded budget, we will assume that our contract negotiations are settled with a zero increase and no step raises. That being the assumption the Police Department would be able to function with current staffing. Any increases in salaries would require a review of our staffing levels and any significant adjustments would require a reduction in staff. With anticipated losses of some staff to serve our country beginning this calendar year further reductions would be absorbed through potentially increased overtime expenses. Adiustments: For FY11, the Police personnel expense lines have been adjusted to more accurately reflect expected spending. The assumptions in the employee line items are assuming no employee turnover and wage levels at the end of FY10. The Police Department proposed budget will staff at the same levels as FY10. The only changes are adjustments within the existing budget in order to accurately reflect use. The educational incentive is fully funded in this budget as the long-term funding for the program and the cost to the community is still uncertain and aspects of. the educational incentive program are currently being negotiated with the Police Unions. The Department no longer receives State Community Policing grant funds of $46,000 and has seen a 15% reduction in Highway Safety grant program funding this year. This directly, impacts the School Resource Officer, Citizen Police Academy, RAD program, traffic enforcement, drug investigations, and other highly visible, pro-active, community based police efforts. In addition, about $20,000 in equipment was purchased through this grant annually. This included maintenance on our cruiser based defibrillators which will need to be maintained from within our existing budget as well our R911 system which will not be budgeted. We are trimming training and equipment purchases with the knowledge of the declining effectiveness this imposes on our department. Of course, we continue to explore grant funding opportunities and make use of regional partnerships like BAPERN (communications) and NEMLEC (training, rapid response team, SWAT) to reduce our costs and expand our service provision whenever possible. 13 Dispatch FY11 Budget Background: Dispatch is primarily personnel driven. The budget for the agency is 91 % personnel and 9% expenses. Dispatch currently is staffed with 8 unionized civilian Dispatch personnel and 1 civilian Head Dispatcher who oversees the administration of the Dispatch center. To implement the guidelines of a level funded budget, we will assume that our contract negotiations are settled with a zero increase and no step raises. That being the assumption. Dispatch would be able to function with current staffing. Any increases in salaries would require a review of our staffing levels and any significant adjustments would require a reduction in staff. Adjustments: The Dispatch budget is mostly unchanged. We have experienced a very stable year in employment and as of July 2009 all our Dispatchers have now completed a five week academy training program funded in part through E911 grants. There have been some adjustments in the Expense line items to better reflect actual intended spending. The biggest impact in the coming year will be the loss of Community Policing funds which paid for annual maintenance on the R911 system. This server based call-out system is about 7 years old and may need to be upgraded or replaced in the near future. The annual maintenance cost cannot be absorbed in the level funded budget. We continue to work closely with the E911 Department which provides training and support grant programs. The support grant is currently covering $40,000 of Dispatch salaries (about 10% of the total). We are also actively involved in a grant funded study to explore the feasibility of regionalizing our Dispatch services. 14 Fire and Emergency Management FYI 1 Budget A level funded FY 11 budget has been submitted as directed. To implement a level funded budget will require reductions in the Fire Department's budget and will result in a reduction in the level of services we provide. The reductions are due to contractual salary increases that will begin on June 30, 2010. The amount of the reduction is $49,770. To implement the guidelines of a level-funded budget, we will focus all resources into providing staffing for emergency response. To achieve that goal will require the following: Eliminate one Firefighter's position. Assign the Fire Prevention Officer to a Shift to cover a long term illness Scale back maintenance on the municipal fire alarm system. Impacts to Reducing the Department by One Firefighter's Position: A reduction in the number of Firefighter positions will: Increase staffing costs (overtime) and will eliminate our ability to manage overtime expenses due to long term absences. Require the Fire Prevention Officer to be assigned to a Group. Impacts to Reassigning the Fire Prevention Position: Assigning the Fire Prevention Officer to a Group will result in some overtime savings. However, the loss of the*position will significantly impact the following areas of our operation: Result in a significant negative impact to our plan review and building inspectional process and this will cause: o . Delays in plan review for major projects o Delays in issuing permits for major projects o Delays in conducting inspections for new projects Reduce our code enforcement efforts Impact the coordination and scheduling of vehicle maintenance Negatively impact our fire data collection The reason for these impacts is due to the need to shift most of the Fire Prevention Officer's duties to the Fire Chief. This is because a different Group Fire Officer works each day and is responsible to respond to emergency calls and perform other administrative duties. Background: Eliminating funding for these key positions is required due to the budget and structure of the Reading Fire Department. Since the Fire Department budget is 97% salary and 3% expenses, a reduction of this scale must come from salaries. The Fire Department's current structure consists of'a Fire Chief, Fire Prevention Officer, Department Secretary and four Firefighting Groups. Any reduction in staffing of the four Firefighting Groups will cause an increase in the overtime requirements to meet necessary staffing levels. 15 Accounting FY11 Budget A level funded FY 11 budget has been submitted as directed. The Accounting Department budget is 99% salaries and is made up of the following employees: 1 full time Town Accountant, 30 hour per week (.8) Accounts Payable clerk 22 hour per week (.6) Administrative Clerk 3.5 hrs per week (A) Assistant Accountant. (This is the full time Retirement Board Administrator who does some work for the Town Accountant) Total FTE 2.5 Impacts to Accounting by FY10 Budget Reductions: Loss of accounting assistance because of absorbing the coordination of the Medical Escort program that was handled by the eliminated position, Co-ord of Volunteers Accounting Department Efficiencies Eliminated budget spreadsheet (data entry of prior year amounts) A Eliminated.stuffing envelopes for vendor and payroll checks Eliminated double entry of school department invoices Eliminated double entry of cash receipts New Accounting Department Responsibilities Training and support on software use for 50 "'end users" Audit "end user" data entry Time and attendance entry Maintain Purchase Order System Trouble shoot software "bugs" Instruction manual updates' specific to Reading Maintain permissions for software access Weekly diagnostics for data integrity Manage software upgrade implementations Impact of cut in hours if necessary Negative impact to customer service o Delayed response to "how to" software questions for end users o Slow response to requests for new vendors, accounts, funds etc. Negative impact to accounting o Delays. in response to technical and training assistance o Higher chance of instances of incomplete or inaccurate accounting records o Less frequent audit of procedural and legal compliance o Delays in issuing reports Cuts in hours will shift responsibilities amongst the remaining hours for the department. Our first priority is to the accurate processing of bills, verifying appropriations, processing cash receipts, reconciling cash, receivables and other general ledger accounts. To the extent that the hourly employees cannot complete these requirements, the Town Accountant will have to absorb the work to meet deadlines and avoid detrimental consequences such as late payment of bills, incomplete or 16 inaccurate accounting records, non-compliance with laws and procedures, etc. Special projects such as the High School.Construction reporting, managing software implementation or setting up new budget reporting documents all require time beyond the 7.5 hour work day. Having to absorb day to day accounting functions from fewer staff hours means everything cannot be done timely or in some cases, at all. The catalyst for change and learning that would provide better, more detailed information or opportunity for efficiencies would be curtailed due to lack of time to spend investigating, implementing and training. 17 Finance Department FYII Budget The Finance Department budget for FYI 1 may be funded at lower levels than in FYI 0. Some increasing costs - such as technology support and additional elections - have been offset by a thorough departmental review of all expenses. Changes have been made wherever possible that would not impact the level of services to the general public or to employees. This budget reflects a level-funded Assessor's budget, which is well below that requested by the Board of Assessors. The Board will be in front of the Selectmen at 8:30am on January 16th to present their requests. Staffing - wage costs No changes to staffing are anticipated by this budget, and all wage costs are set at FYI 0 levels. Due to additional elections in FYI 1, total departmental wage costs are higher in FYI 1 as shown below: WAGES FY10 FY11 Change Assessors $149,317 $149,317 $0 Finance $495,053 $493,983 -$1,070 Human Resources $75,736 $75,736 $0 Technology Town.Clerk $273,723 $113,026 $273,882 $106,536 +$159 -$6,490 Elections $18,300 $37,956 $19,656 TOTAL $1,126,155 $1,137,410 +$12,255 (+1.1%) Staffing - impact to services Since there are no changes to staffing, no significant impact to the level to the level of services is anticipated in FYI 1. Demand on services has increased over the past year. The Finance department serves the entire town (including the School and Light Departments) in many benefit areas, and due to the economic downturn, the number of personal financial discussions have substantially increased. Increased demand for technology support has been met by the current staffing level - the addition of a technician a year ago has prevented a serious problem. An increase in electronic communications and preventative mailings to the general public has improved collections and reduced the number of complaints to the department. However due to the nature of the economy, some individual circumstances have required significant staff involvement before amicable resolution to billing issues are achieved. Expenses Tax title actual expenses'for FY09 were about $17,000. The FYI 0 budget amount was increased to $30,000, but at present that appears to be overfunded, and the proposed FYI 1 amount is $20,000. Banking services have been decreased from $32,000 to $28,000, reflecting savings generated by installing four scanners in the collector's office, which will help reduce expensive lockbox charges. A banking RFP next spring may reduce these projected charges further, 18 as the banking industry is returning to profitability. Decreased hiring has reduced HR expenses by $9,500 in this budget. As difficult financial times are forecast to last for at least a few more years, this 50% reduction in expenses is appropriate. There is an increase of $8,000 in technology expenses, reflecting the ongoing need to keep software and virus protection measures current, as well as a new $5,000 annual cost for document storage features on town hall copiers/scanners. A small increase in expenses is needed to cover the two additional elections in FYI 1. EXPENSES FY10 FY11 Change FINCOM $52,500 $52,500 $0 Assessors $18,000 $18,000 $0 Finance $134,000 $119,500 -$14,500 Human Resources $19,500 $10,000 -$9,500 Technology $262,000 $270,000 +$8,000 Town Clerk $1,800 $1,800 $0 Elections $29,500 $31,500 +$2,000 TOTAL $517,300 $503,300 -$14,000 Summary Improvements to the department - both in technology and operations - over the past few years have come with additional costs. Benefits including high levels of customer satisfaction for both residents & employees have resulted. Future improvements will always be needed. Many can be made with minimal new costs, and expensive alternatives may be delayed until sufficient funding is in place. There is a temptation to trim expenses for a while in the midst of difficult financial times. This must be weighed against the increased productivity brought to all departments through technological improvements, and financial flexibility brought to the Town through thorough financial analysis and planning. 19 Department of Public Works FYII Budget My first budget as Director of Public Works presents a number of challenges. More specifically, with budget guidelines set at 0%, and increasing supply and contractual costs, it will be the department's goal to maintain the high quality of service that the town has come to expect and enjoy. Within the scope of the Level 1 budget, FTE's remain at FY10 levels, and all expenses have been level-funded with few exceptions. Equipment Maintenance: The equipment maintenance line item in the Highway Division has been increased in the level 1 budget only to reflect more realistic and actual costs utilizing a 5-year average. For several years, the funding for this line item has fallen short and has been addressed through Town Meeting transfers. To reduce the need for further transfers in this area, I believe it's critical to properly fund it, especially when there's an ongoing history to demonstrate the need for it. Going back 6 years and more, equipment maintenance has been critically underfunded. To remedy this situation, I propose to bring the FY11 equipment maintenance budget up to the 5-year average. One potential funding source could be reallocating appropriate engineering costs from the General Fund to the Enterprise Funds to reflect a true allocation of cost incurred for the services provided. Specifically, move (1) Asst Civil Engineer from the General Fund to the Storm Water Enterprise Fund. One engineer is working on Storm water projects; moving that position under Storm Water Enterprise would align it with its funding. In FY11 and beyond, NPDES Phase II Program will demand increase staff time to complete outfall inspections and sampling, expand public participation programs, and work with a, consultant in developing detailed mapping -of the Town's drainage infrastructure. The current permit will most likely undergo a major re-issuance by EPA within the year, requiring at a minimum, increased compliance and regulatory demands of Town owned facilities, and increased monitoring and documentation of regulatory requirements by the Town for commercial and industrial sites. It is anticipated the revised regulations will require substantial increases of staff time to meet compliance and avoid administrative penalties. Landfill Monitoring: A new line item under Solid Waste associated with landfill monitoring costs involving a former town project has emerged in the FY11 budget. In the past, this expense has been addressed by utilizing permitting fees from the Revolving Fund set up for Johnson Woods, Archstone, and Walkers Brook. However, due to projected decreases in this revenue source, the town must now budget for this ongoing expense. This program will continue for a 30-year period: first with quarterly; then semi-annually; then annual testing. We are currently at year 4, and annual testing begins in year 6. Recreation: 20 The Recreation Division (which is fee funded), does reflect a new $5,000 line item for overtime. This increase has been built into the overall programming budget and will be covered fully by the revolving fund. The change was necessary to continue the high quality of Recreation programming as a whole. The Division was allocating many hours out of normal operating time (8:30 am - 5:00 pm, M - F) for programming and. events, thus planning and prep time was becoming more difficult to accomplish in the short hours in the office. The level 2 budget request also reflects 0% increase in the bottom line budget, including no projected cost of living or step increases for any employees in FY11. In a real sense the budget reflects a very conservative, no frills approach. It mirrors not only the state of the town available resources, but the state of our overall economy as well - an environment I see continuing for a few more years. 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