July 20, 2017: Talking today about when savings run dry

July 20, 2017 — Belmont Citizen-Herald

It’s worth saying out loud already.  Even though Belmont has been frugal with its spending in recent years, Town Meeting was told this May that “projected deficits for [Fiscal Year 2020] and beyond suggest that. . .increased revenue (such as in the form of a future override and/or reduced expenditures) may. . .be required in the coming years.”

This message was brought by a group called the Warrant Committee.  The Warrant Committee is charged with being TM’s advisor on financial matters.  The Committee authors a report to TM each year on Belmont’s proposed budget for the coming year and beyond.  While not easy reading, the report is worth paying attention to.

Belmont has used the increased revenue from its 2015 operating override wisely, this year’s report said.  When voters approved the 2015 override, TM created what was called the “General Stabilization Fund.”  The GSF was intended to serve as a “savings account” to hold the override revenue until needed.  The override revenue was expected to help the town balance its budget for three years (2015, 2016, 2017).

In fact, according to the Warrant Committee, Belmont will not need to draw money from this “savings account” in 2018.  As a result, the Warrant Committee said, “we should be in a position to use a portion of [the GSF] to balance the budget in [Fiscal Year 2019].”  It is at that point, however, that the arithmetic catches up with Belmont and the savings account will run dry.  The arithmetic is easy to understand.  While expenditures in this year’s budget will increase by 3.5%, revenues simply don’t increase that fast.  Accordingly, while Belmont can draw down its savings account for several years, eventually those savings will run out.

This year’s budget does what most Belmont residents really want done.  According to the Warrant Committee, “the recommended budget maintains roughly level town services, avoids major cuts in the School programs and addresses higher enrollments, and provides for capital investments (roads, sidewalks, equipment).” The Warrant Committee reported unequivocally that “Belmont’s schools are efficiently run with excellent results.”  The Committee noted that “there has been increasing attention to the state of our roads and sidewalks and the 2015 override devoted more resources in this critical area.”

Schools. Roads. Level services.  Good job, right?

So, given that good news, why talk about 2020 today? The time comes closer, you see, when Belmont will need to seek another override approval from the voters.  When that time arrives, statements will be made about the dire consequences of not approving the override, as well as about the “millions of dollars of waste” that could be removed from the budget (if only we “really tried”).  Letters will be written. E-mails sent. As we know all too well, however, in an election campaign, it is often difficult to separate truth from spin. Competing claims are often intended not to educate, but rather simply to harden the pre-existing opinions of people who already firmly believe one way or the other.

Knowing what we know today about when the arithmetic tells us our savings will run dry, therefore, one process that would be beneficial, whether through the Warrant Committee or someone else, is for a series of public forums to be held over the next two years to allow the public to express their opinions about what specific services are essential to preserve from cuts and, conversely, where specific budget cuts would be proposed by those who believe waste exists.

Engaging in that public conversation outside the context of a campaign, by beginning it before an override is proposed, and hosting it by town officials, would be helpful to all concerned.

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May 25, 2017: Walking the line between capital truths

May 25, 2017 — Belmont Citizen-Herald

One of the truly thankless jobs in Belmont is serving on the town’s Capital Budget Committee. Two intractable truths face Belmont: (1) the capital needs of the town are real; and (2) the inability of many households to pay increased taxes to meet those needs is just as real.  The conflict posed by these two competing truths should be acknowledged. The reality of the needs does not make the ability-to-pay any greater; and yet, the inability-to-pay does not make the needs any less.

Some of the town’s most experienced public servants sit on the committee to figure out how to walk the line between these competing realities: former Selectman Anne Marie Mahoney, current Selectman Mark Paolillo, Jennifer Fallon, Becky Vose, Pat Brusch, and others. Under Belmont’s by-laws, committee members determine which projects or purchases are “most necessary.”  And they are charged with developing “the probable cost,” along with a “recommendation as to the method of financing” each project.

They scrimp and scrape and try to figure out how to make do with not enough money. In this year’s capital budget report to Town Meeting, for example, the committee reported, “the Fire Department will replace Squad 1 with a refurbished truck from the [Department of Public Works].”  The committee noted “a spirit of cooperation has developed among the departments who now make an effort to offer ‘hand-me-down’ vehicles and equipment to other departments.”

The problems the Capital Budget Committee faces are often thorny.  The lack of “good” solutions, however, does not allow them to “do nothing.”  Increasing student enrollment is one such issue.  The committee reported that “additional classroom space was required at the high school and the Burbank for the 2016-17 school year.” The addition of more modulars at the Burbank and the Butler is expected in the fall of 2018.  The committee told Town Meeting: “if enrollments continue to grow rather than [peak], more classrooms will be needed in the not too distant future.  The CBC anticipates that these future requests to fund modulars and/or to outfit additional classrooms may become more and more difficult to include in our limited budget allocation.”

The Capital Budget Committee is not, indeed cannot be, a cheerleader. If there is bad news to report, it must be said (out loud and in public), popular or not.  For example, Belmont has facilities that are not simply falling apart, they have fallen apart. According to the committee, in the opinion of many people, the police department and DPW “facilities are in worse shape than either the library or the high school.  Our town employees work in the police and DPW facilities under deplorable conditions. . .”

Finally, one job of the Capital Budget Committee is to identify those projects needing to be pursued, whether or not there is any group of people clamoring for them to be done. The committee told Town Meeting this year, for example, that unlike the library and the high school, “the Police Station and DPW are left without a constituency to advocate for them and no clear path forward.”

Understanding the job of, and the limits upon, the Capital Budget Committee, of course, does not require Town Meeting to accept without question the annual capital budget presented for Town Meeting consideration. I certainly have had my differences with the committee in the past.  In its upcoming review of the town’s capital budget, however, one would hope that Town Meeting will express an understanding of the complexity of the task of structuring a capital budget, and an appreciation for the willingness, and ability, of the Capital Budget Committee to keep all the balls up in the air for yet another year.

April 27, 2017: Ill-fated solid waste facility should not shackle our future

April 27, 2017: Belmont Citizen-Herald

Town Meeting should act favorably on the Pay as You Throw article that will be considered in May. That article would allow the Board of Selectmen to consider PAYT when Belmont negotiates a new solid waste contract this coming fall, notwithstanding a 1990 over-ride regarding solid waste. Arguments that the 1990 vote created a “social contract” under which Belmont residents would never need pay for trash collection should be rejected.

The tale of the 1990 over-ride actually began years before, when Belmont yielded to pressure placed on Massachusetts communities to join a consortium to incinerate their solid waste. According to a 2001 Harvard Business School analysis: “in the late 1970s and early 1980s Massachusetts officials leaned hard on many communities to join a consortium to incinerate their solid waste. . .[The state] wielded heavy sticks, notably the threat to close down existing landfills. Some municipalities resisted this pressure, but almost two dozen—representing 500,000 Massachusetts residents—felt they could not.” Belmont was one of 23 communities that joined the North East Solid Waste Committee.

Things went wrong almost immediately. The biggest problem arose when the state stopped pressuring local governments to close their landfills. Landfills that were expected to close instead continued to operate. Since the NESWC contract called for a Guaranteed Annual Tonnage to be provided to the incinerator, when large communities such as Lawrence and Lowell decided not to participate, the 23 smaller communities (including Belmont) were required either to provide equivalent substitute tonnage for the trash that had been expected from the large communities or to pay for that tonnage anyway.

The adverse impacts on Belmont were extraordinary. The 1985 Warrant Committee report to Town Meeting noted that the “costs of disposal will rise to about $29 a ton from $16 during the current fiscal year.” In 1986, the WC reported that the “costs of collection and hauling will be about $56 a ton.” In 1987, the WC told TM that the budget for solid waste was “almost 70 percent above the amount voted [the previous year]. . .”

The cost increases simply didn’t slow down. A subsequent investigation of NESWC by the Massachusetts Inspector General reported in 1997: “NESWC communities currently pay approximately $95 per ton for waste disposal.” In short, NESWC created a financial crisis for Belmont: a 600% increase in trash collection and disposal costs (from $16/ton to $95/ton) in just over ten years (1985 to 1997). The Inspector General’s report noted that “rapid increases in the cost of waste disposal meant that other budgetary items necessarily had to get trimmed.”

Because of these budgetary pressures, Belmont swallowed hard and passed a 1990 over-ride devoted to solid waste. This was not based on any commitment that residents would “never have to pay for trash collection and disposal,” but rather because Belmont was drowning in NESWC debt that threatened the town’s schools as well as its police, fire and other community services.

The financial debacle associated with the NESWC trash incinerator no longer burdens our community. Today, moving to PAYT would not only be environmentally friendly, but would save the town close to a million dollars over five years. To allow the NESWC disaster to prevent Belmont from even considering a contemporary trash collection and disposal scheme would be to allow that NESWC incinerator to impose continuing environmental and economic harms on Belmont.

Belmont suffered for years because of the ill-fated NESWC facility. It should not, today, be allowed to shackle us in the future to both our financial and environmental detriment. In negotiating a new solid waste contract this year, the BOS should be authorized to at least consider PAYT.

January 26, 2017: Fire Department retirements: what happens next?

January 26, 2017: Belmont Citizen-Herald

One of my pet peeves about Belmont’s town government is when issues are raised but never again publicly addressed. No report is made. No decision is presented.  People are left not knowing whether the issue was resolved; found to be without merit; or simply swept under the rug with the hope that folks would forget it was ever mentioned.  The public debate last year about the town’s continuing participation in the Minuteman High School is a good example of an exception to this process.  The issue of Belmont’s participation in Minuteman was squarely presented to the Belmont community and definitively resolved.

One contrary example involves the future of the Belmont Fire Department.  Each spring, the Town’s Warrant Committee, the committee which advises Town Meeting on financial matters, presents its report on the upcoming year’s town budget.  The report is based on dozens of hours of study by Warrant Committee volunteers of the proposed revenue and expenses for the upcoming year and beyond.  The Warrant Committee report includes not only findings, but recommendations moving forward.  The committee is intended to be a community-based financial watchdog for Town Meeting and thus for the community as a whole.

In the Warrant Committee’s report on this fiscal year, starting July 1, 2016, one observation the WC made was that “as a result of key retirements, there will be a loss of institutional knowledge and leadership in late FY2017 and FY2018 at the Fire Department.  A broader strategic process will help ensure a smooth transition that also matches Town strategic plans.”

That comment was significant because in the previous year, in its report on the annual budget starting July 1, 2015, the Warrant Committee had advised Town Meeting that “over the next three years, approximately one-third of the Fire Department’s administration will be eligible for retirement, with FY2018 representing the peak year. The Town will be able to assess in the coming two budget seasons whether this creates opportunities to reorganize or outsource non-core duties for greater efficiency while ensuring that Departmental priorities are not compromised.”

And, in the year before that, in its report on the annual budget starting July 1, 2014, the Warrant Committee had advised Town Meeting with respect to the Fire Department that “transition of staff in [the] next five years” creates an opportunity for a “dialogue for vision – ‘What are our needs in Public Safety?’ and, ‘What type of department/services would we like to have?’”

The time ticks down.  In 2014, the WC referred to the “next five years,” three of which are now in the books. In 2015, the WC referred to “the next three years,” two of which are now in the books. In 2016, the WC referred to this year and next.  Nonetheless, no public assessment has been made of a possible reorganization of the Fire Department. No “dialogue for vision” has occurred.  No public process has happened to determine “what type of department/services would we like to have.”

I’m not saying that Belmont’s Fire Department requires major reorganization (though, as readers know, I would prefer to have a single Department of Public Safety rather than separate fire and police departments). However, when Town Meeting is told, particularly when it is told in three consecutive years, that certain planning processes are needed, and that the period in which those processes should occur is time-constrained, those recommendations should not simply evaporate into the mists of time.  The time in which Fire Department retirements reportedly will occur is now nearly upon us.  Community members deserve to be informed both what planning processes, if any, for our Fire Department are expected and what public input is intended.

February 11, 2016: Belmont Finances: Ready, aim-aim-aim-aim?

Belmont Citizen-Herald: February 11, 2016

Back in the days when I taught Urban and Regional Planning at the University of Iowa, we talked on occasion about the “ready-aim-aim-aim-aim” syndrome. The concept, of course, refers to communities who constantly plan what they’re going to do without ever actually doing it. At some point, we told our students, you need to “fire.”

Belmont’s leadership is now beginning the process of developing next year’s budget to present to Town Meeting. Even though Town Meeting is still more than two months away, as part of that budget process, let’s briefly review some of the financial goals set by the Board of Selectmen for 2015 to inquire whether they were actually done.

The questions that follow are truly questions. Asking the questions should not be read as implying the lack of performance. These questions instead simply express the belief that the Belmont community has a reasonable interest in hearing whether the BOS, in fact, did last year what it said it was going to do.

In the Town’s Annual Report, released in early 2015, the BOS articulated its “goals for 2015.” Those goals included to “implement the recommendations of the Financial Task Force.” The Task Force was the work group that was charged with developing a long-term financial plan for Belmont. The Task Force’s January 2015 recommendations largely served as the foundation for last spring’s successful override.

Many of the Task Force recommendations are not subject to ready accountability after-the-fact. For example, it is difficult to determine whether the recommendation that specific sources of additional revenues be “considered” actually occurred. As parents, we’ve all probably responded to the kids’ plea for a Disneyland trip by saying, “I’ll consider it.” Nonetheless, the community deserves to hear a reporting out of the results of such “consideration.” Which new revenue sources were adopted; which were not, and why?

Other Task Force recommendations were quite explicit. The question “was that task completed” is easily answered “yes” or “no.” One recommendation was to “hire a new full-time professional Recreation Director to manage recreation facilities.” That was accompanied by the recommendation to “consolidate the management of Town and School recreation assets under experienced recreation management.” Were those tasks accomplished?

The Task Force recommended creation of “a Field Management task force of all stakeholders to determine usage, prioritization, fees, maintenance and upgrades and to coordinate improvements for both Town and School fields.” Does this new group to oversee the use, funding and maintenance of our fields now exist?

One recommendation was to “explore opportunities for collaboration and/or regionalization with surrounding communities in the delivery of Town services.” A commitment to “explore” something is somewhat akin to committing to “consider” something. Nonetheless, a report of the results of such “exploration” is merited. What possible regionalization opportunities were identified; which were accepted or rejected?

The Task Force recommended that Belmont “establish a working group of town administrators/managers with comparable communities to enable the sharing of innovative ideas and solutions to the common challenges we face in the delivery of town services, effective management of our increasing cost infrastructure and the generation of additional non-property tax revenues.” That’s a specific task. Does that working group now exist?

Developing a long-term financial plan can be of great value if used to direct decisionmaking. Such a plan can be of little value if written and then left to gather dust. As we enter Belmont’s budget season, both the community as a whole, and Town Meeting in particular, have an interest in hearing the extent to which the Financial Task Force’s recommendations have been acted upon. Without such implementation, Belmont is simply another example of the “ready-aim-aim-aim-aim” syndrome.

 

July 23, 2015: Rethinking our public safety budget

July 23, 2015: Belmont Citizen-Herald

One of the most fundamental services that Belmont provides its residents is public safety.  Public safety shows up in the budgets for the police and fire departments.  An opportunity to reorganize and improve these departments, while reducing costs, may be before us.

In its annual report to Town Meeting this May, the town’s Warrant Committee noted that “over the next three years, approximately one-third of the Fire Department’s administration will be eligible for retirement. . .”  As a result, the WC said, “the Town will be able to assess in the coming two budget seasons whether this creates opportunities to reorganize or outsource non-core duties for greater efficiency. . .”  While not identifying specific ideas in its report, the WC told Town Meeting that examining how other communities organize their public safety functions will “bring ideas, efficiencies and enhance[d] support for departmental goals while ensuring priorities are met.”

The potential benefits from fire department reorganization can be seen in the staffing and “incident” responses that the WC reported to Town Meeting.  “Fire suppression” constitutes nearly 90% of Belmont’s fire department budget.  The WC told Town Meeting, however, that out of the 4,667 “incidents” which the fire department responded to last year, 1,570 (33.6%) involved emergency response by ambulance; 1,315 (28.2%) involved “non-medical emergency response”; and 947 (20.3%) involved life support transport.  In contrast, 110 incidents (2.4%) involved fires, while an additional 725 (15.5%) involved “good intent/false calls.”  The fire department, according to the WC, does not have “supportable data” to report staffing workload by call type.  Obviously, however, not all “incidents” are equal.

Nonetheless, now may be the time to rethink Belmont’s fire department.  “Prior to the addition of new positions,” the WC told Town Meeting, “an in-depth analysis of staffing models and best practices in peer communities should be conducted to determine if there are opportunities. . .applicable to Belmont. . .”  The WC said that it would “encourage” the fire department to undertake such an assessment.

In the police department budget, the two largest areas of expenditures involve “patrol services” (57.2%) and “public safety communications” (13.5%).  Police administration is reasonably efficient, representing 6.6% of the budget (virtually identical to the 6.3% the schools spend on administration).  The WC noted that over the past five years, the police department has experienced twenty vacancies “due to retirement and voluntary separation.”  Filling those vacancies, the WC told Town Meeting, “has always been a management challenge in an environment of increasing complexity of the role of [the] police force and constrained municipal budgets.”

Any effort devoted to rethinking how the fire department fulfills its functions, therefore, should also pay attention to whether some functions are neither uniquely “police” nor uniquely “fire,” but rather “public safety.” Ways in which these functions might beneficially be combined should be examined.

Belmont faces certain financial “headwinds,” the WC told Town Meeting, that the town has “been managing for years and will continue to do so.”  The “major drivers on the expense side,” the WC said, include “increasing compensation costs” and the town’s “large pension and healthcare obligations.”   Given the large proportion of the police and fire budgets devoted to salaries, therefore, a thoughtful reconsideration of how most efficiently to deliver public safety services could be important to Belmont’s long-term financial health.

Opportunities to fundamentally rethink how the town provides an important public service are rare.  Belmont, however, may soon face exactly this opportunity for our police and fire.  In considering how public safety functions might be combined between the police and fire departments, either through physical facilities or through staffing, town officials should aggressively solicit the broadest possible public input.

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.