July 16, 2015: Fixing past capital budget problems

July 16, 2015: Belmont Citizen-Herald

Belmont’s capital budget presents a story of historic inadequacy, resulting in costs, both short- and long-term, being higher than they should have been.   Improvements are being implemented.

The group primarily responsible for the oversight of Belmont’s capital expenditures is the Capital Budget Committee.  The CBC’s job is to annually review the capital expenditures requested by the town’s various departments and to report to Town Meeting each Spring those expenditures which “represent the most necessary. . .to be undertaken by the Town.”  Town Meeting must then vote to approve or modify the capital budget.

Belmont lacks the funds needed to fully address its immediate capital needs.  According to this year’s CBC report to Town Meeting, the cost of projects that are “appropriate and important. . .if funded immediately, exceeds the funds available.”  The problem isn’t new.

The capital budget has been squeezed in the past by the inadequacy of operating dollars as much as by the shortage of capital dollars.  When limited funds placed pressure on the annual operating budget in the past, the CBC said, “maintenance was not pursued. . .[T]he inevitable result of wear, tear and simple weathering, plus maintenance neglect [was] the seeming transformation of a current expense (maintenance) into a seeming capital expenditure (starting all over again).”  Rather than maintaining its capital assets, in other words, Belmont simply let them wear out and then replaced them. This was (and is) an expensive way to do business.

Belmont’s capital budget outlook improved when, in 2013, the Town consolidated oversight of all facilities, including those of both the schools and the town, under one staffperson.  One of this person’s first tasks was a “facility audit” of all buildings that had not been renovated within the past twelve years.  Using funds provided by the successful 2015 over-ride, the CBC has now committed to work “to ensure that the Facility Department is adequately funded in the operating budget to handle routine maintenance.”

Town Meeting, this spring, took an additional step to address long-term capital needs when it created a “Major Capital Stabilization Fund.”  According to the Warrant Committee’s annual report to Town Meeting, this fund “is intended to hold one-time revenues from the sale of Town assets” (such as the Cushing Square parking lot) along with other monies.  The Stabilization Fund serves as a type of savings account “to help address four very large capital projects” which the town will face in the future: the high school, the DPW facility, the police station, and the library.

One CBC recommendation that has not (yet) been approved is creation of a “technology fund for computer and other technological purchases.”  Unlike other capital items, technology needs to be frequently replaced and would benefit from a budget set-aside.

The CBC noted in its report to Town Meeting that Belmont benefits from capital expenditures made through Community Preservation Act funds.  Under state law, CPA funds can be used for housing, recreation / open space, and historic preservation. For example, the CBC said, CPA funds were approved this year to rebuild the Pequossette tennis courts  According to the CBC, that project would “most certainly” have been a capital request.  “CPA funds may not always lessen the burden on the Town’s capital budget,” the CBC said, “but will support worthy projects that enhance the quality of life in Belmont and preserve valuable public assets that would otherwise suffer neglect.”

While Belmont’s historic lack of funding has too frequently allowed its capital assets to prematurely wear out in the past, recent improvements have been pursued in long-term planning, consolidated operations, and routine maintenance.  Important additional improvements that have been recommended remain to be adopted.

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