HANSON – The “runway’s too short” to land the budgetary plane with an operational override this year, according to officials discussing the fiscal 2025 town budget on the eve of the certification of the W-H regional school budget.
“I think it’s a bit premature for us to zig or zag since we don’t know what the assessment’s going to be set at,” Chair Laura FitzGerald-Kemmett said at the Select Board’s Tuesday, March 19 meeting. “But we certainly need to be ready and be agile, depending on what that amount is set.”
Finance Committee Chair Kevin Sullivan agreed the town’s last override experience demonstrated that it takes a lot of education and groundwork to pass an operational override.
“I don’t think we have time,” he said “You have to make the citizenry aware that, while you’re approving the $5 million [for an operational override], it is the Select Board that decides how much of that is tax. … There’s no bank account where this money is sitting.”
He argued for going for a full operational override next year.
That said, Sullivan said he has done the math and personally has thought “for years, thought we needed a significant override,” to reset town finances.
Stressing that a decision on any form of an override, if any, is needed this year it would have to be a school override, FitzGerald-Kemmett said. She added she had spoken with Whitman Select Board Chair Dr. Carl Kowalski and School Committee Chair Beth Stafford this week, telling both chairs where Hanson is at and what the board has discussed in open session – “to the extent that, if the assessment didn’t come down to a point that we had felt comfortable with that we might entertain an override, but if we did, it would probably be a school override.”
By the end of their discussion, the Hanson Select Board reached an unenthusiastic consensus for accepting a 5 percent school assessment increase, but member David George refused to budge from 3.8 percent.
“That, combined with [consultant John] Madden’s presentation to us last week, indicating that next year we would need an operational override, it seemed ill-timed for us to do an operational override this year, with such short notice, such a short runway,” FitzGerald-Kemmett said. “We really need to educate people on what that money would be used for [in] an operational override.”
Even if the board decides to seek an operational override next year, they have a lot of education of the public ahead of them concerning what it means, how it would work, whether to do $5 million up front or break it up into annual overrides, how the average tax bill would be affected, and other issues she argued.
“Like I said, the runway’s too short for us to do an operational override this year.” she said.
Board member Ann Rein urged the board to stick to 5 percent.
“We’re not the only ones that should have to cut budgets,” she said.
FitzGerald-Kemmet agreed.
“I feel 3.8, but I’m going to be reluctantly, saying 5 percent,” Board member Ed Heal said. “But other departments are sticking to 3.8, by the sounds of it on average.”
“Or making a case [for more],” FitzGerald-Kemmett said, something she said the schools should be doing again as they did when Dr. John McEwan and Dr. Ruth Gilbert-Whitner had done.
At a 5 percent assessment increase, Select Board Vice Chair Joe Weeks said there would be just enough free cash to balance the budget with the remaining $44,000 easily wiped out with capital projects.
“No matter how you do the math, it comes out somehow to $1.4 million – which is exactly what we have,” he said.
Sullivan said the Finance Committee was willing to use that figure one more year, yet it would cause the spending of all the town’s free cash.
FitzGerald-Kemmett said Town Administrator Lisa Green and Town Accountant Eric Kinsherf have been thinking through different financial scenarios in preparation for the school budget certification.
“None of them are particularly bright spots,” she said.
Green noted that she and Kinsherf had calculated the effects of the different scenarios Superintendent of Schools Jeff Szymaniak outlined March 13 to get a broad picture of the increases and their effects on Hanson and what its budget shortfall might be.
“We don’t know what direction the School Committee is going to go into, but this will give an idea of where we will be should any of these assessments be voted in,” Green said, suggesting that the reduced schedule of the Building Department for a few weeks, due to the prolonged sudden absence of an employee, could offer a vision of what Town Hall could become if the town was forced to cut staff.
Green admitted when asked, that she had not yet discussed the potential for layoffs with department heads as yet.
“I want more information to provide them with,” Green said.
Anticipating that the schools may set a 5-percent increase, Kinscherf said the choice becomes balancing the budget with free cash this year or implementing budget cuts.
“If we have a 5 percent increase with the schools, the town of Hanson will have to use free cash to fund the budget, there’s no doubt about it, unless you want to cut the operational budget,” he said. “We’re either going to use free cash … to get us through one year as another Band-Aid, or do the budget cuts this year.”
If the schools are over 5 percent, Kinsherf said it leads to an override for the amount over the 5 percent. Right now, Hanson has $1.4 million on hand in free cash and there are already $396,000 in expenditures included in the Town Meeting warrant.
“I think we can balance the budget with the approximately $1 million that’s left over,” he said, cautioning it would leave the town with zero. FitzGerald-Kemmett asked about grants or other funding sources could be used to help town finances.
Kinsherf said he and Green were searching past warrant articles for unexpended funds, but warned any money found that way can only be used for capital projects – not to fund the operational budget.
“We’re already putting ourselves in the hole for $1 million next year,” Weeks said. “I feel like we’re just in this hamster wheel of the same conversation every year.”
“We did not have the data to make any decisions last year,” FitzGerald-Kemmett said, noting that was when they brought in Madden. “Now we’ve got that. Now, if we don’t act, it’s on us.”
Weeks replied they didn’t need John Madden to go over the numbers.
“We knew this,” he said.
Weeks then asked Sullivan if the Finance Committee supported using free cash that way.
“I know that, while we haven’t voted any actions, I know as a group, we are not fans of using free cash for the operational budget, but we are realists of the fact that sometimes, you’re just not going to get there [otherwise],” he said.
“To me, it’s a school override, and I know some people disagree,” FitzGerald-Kemmett said, acknowledging some people see a domino effect happening if it should fail. “But we just can’t keep using free cash.”
“We need to have people understand why we’re doing what we’re doing,” Rein said.
“Personally, it’s just a matter of what [the schools] can justify the spending of,” Weeks said.