The first forecast for the coming budget season in Belmont is dreary with little chance of a sunny outcome.
With the US and Massachusetts economies expected to bump along for the coming year without any real growth, town officials are predicting yet another year of the school and town departments requiring to hunkering down in the budget process with little in the way of relief from added commercial growth in Belmont or an increase in local aid from Governor Deval Patrick's administration.
But while the initial outlook is dank, some see a glint of a silver lining as it could be far worse.
On Wednesday, Dec. 12, Belmont Town Manager David Kale provided the Warrant Committee – the financial watchdog to the Town Meeting – with a preliminary revenue outlook for the town in the coming fiscal year 2014 that begins July 1, 2013.
Kale's initial prediction is that overall revenue – from property taxes (increasing by nearly $2 million to $74 million from last year), state aid (a predicted drop of two percent or $39,000) and other areas – for next fiscal year will increase by $1.7 million to $91.1 million, a nearly two percent increase from the current fiscal year.
Taking out about $15.3 million of fixed costs, such as debt serving on large capital expenses and retirement costs, the town will have just under $75.8 million to fund both the schools and town departments, an increase of $1.6 million from fiscal 2013.
Yet the increase to fiscal 2014 is 2.1 percent compared to 3.6 percent between fiscals 2012 and 2013.
And using a "split" approved by Town Meeting last year, 58 percent, or $44 million, will be going to Belmont schools with the remaining 42 percent, or $31.8 million, will fund town services.
Compared to the fiscal 2013 budget, the schools will see a $903,000 increase to its budget and the town will see $654,000 more.
But as Kale told the Warrant Committee, this is the best guess as of Dec. 12 of a budget that goes into effect more than six months from now.
"There are a lot of moving parts" to the budget, said Kale, noting that the state aid figure will certainly change by the time Town Meeting meets to approve the town budget in the first week of June.
Based on information provided by the state and Town Moderator Michael Widmer, who "in real life" has been president of the Massachusetts Taxpayers Association – the state's premier public policy organization dealing with state and local fiscal, tax and economic policies – for the past 20 years, it's likely that revenue coming into state coffers will be slower than the national economy in 2013 than in 2011 when growth in Massachusetts was stronger than in the US.
"We are tied to the national economy and expectations is for very modest growth," said Widmer, resulting in the state likely to face a $800 million deficit for the coming fiscal year.
Widmer said Patrick is considering one of two "major" revenue initiatives this year; a increase in the state income tax rate currently at 5.3 percent or a transportation-targeted tax such as bumping up the state gas tax or increasing registration fees.
But even if those raise an expected $1.4 billion, about $400 million will be go to tax relief for the most vulnerable which will leave just enough to fill the deficit the state is facing, much less sending any amount to municipalities.
Widmer said that he is predicting there will be no reductions in last year's allocations to schools known as Chapter 70 as education continues to be Patrick's "highest priority."
"It will be level funded for the coming fiscal year," said Widmer. But he believes Patrick will be sending less to pay for all other town services from police and fire to recreation and public works.
Yet, as Warrant Committee member Elizabeth Allison noted, the predictions are "are not as cataclysmic as it could be."
Saying she didn't "want to say anything cheerful to break the current mood," Allison said while the rate of increase in total revenue was nearly half of the previous year's, the amount the town will need to "find" to obtain the same level of spending is about $510,000, an amount that is just a quarter of the nearly $2 million deficit the town faced in January of 2011.
"So it's not so bad," said Allison.