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The Budget 2014: Good News From the State Could Ease Belmont's Budget Crunch

While the most recent revenue projections for fiscal 2015 are conservative, come back in March for more realistic estimates.

Mike Widmer.
Mike Widmer.
It was news that Michael Widmer has been unaccustomed in delivering in his annual presentation to the Belmont Warrant Committee, the town's fiscal watchdog, on the coming year's state budget.

"I have a little bit of good news," said Widmer, president of the Massachusetts Taxpayers Foundation and Belmont's Town Moderator, before the Warrant Committee at its Wednesday, Dec. 4, meeting in which Belmont's first preliminary budget was introduced to the public.

"I don't know how to handle it," he quipped after presenting five years of anxiety-filled predictions on the amount of state aid predicted to be coming to Massachusetts cities and towns.

Widmer revealed that revenue from taxes and growth entering into state coffers has picked up during 2013, beating the predicted "benchmarks" set by the Department of Revenue at the beginning of the year.

And unlike the spike in tax reciepts of a year ago that primarily came from residents selling equities before the federal government increased taxes on them, Widmer said this year the jump in state revenues is the result of greater withholding taxes due to an improving state economy and a rise in job participation. 

While calling the improvement "a modest recovery" from the 2008 crash, Widmer said the four to five percent growth in the state's economy is far better then the relative meandering numbers of the past few years.

So how does this improving condition in state revenues help Belmont's budget crunchers?

Rather than predicting either no or a middling increase in state aid coming from the state this spring, Belmont can conservatively predict a two to three percent jump in funding for general government and the schools from Gov. Patrick's budget which should be released on Jan. 22, said Widmer, who as Town Moderator selects the member of the Warrant Committee. 

And the good news keeps coming; Widmer notes that next year will hold state elections in which the Massachusetts legislature – filled with members seeking re-election in November – will not attempt to undercut Patrick's proposal as they have in the past.

"We will surely see an increase in state aid for the first time in a long time for general government and education will also see a bump up," said Widmer. 

And Belmont's financial review committee liked what they heard.

"That was both helpful and extremely encouraging," said Committee Chair Michael Libenson. 

But that good news was not reflected in the town's revenue projections that will be used to craft the town's fiscal 2015 budget that begins July 1, 2014. 

While Belmont is occupied by some of the most progressive voters in Massachusetts, when it comes to the budget process, the town has a tradition of being as conservative as Ronald Reagan on his horse.

Reading through the estimated revenue projections presented at the meeting, the town estimates an increase in non-property tax receipts – things like motor vehicle excise taxes, meals, fees, licenses and parking tickets – of a very modest $320,000 as officials are projecting raising $6,330,000 in fiscal 2015. That is despite the fact that Belmont is projecting to raise $6,469,000 this fiscal year and actually raised $6,837,000 in fiscal 2013. 

After projecting both property and non-property revenues and taking out for fixed costs – debt services, retirement assessments, overlay account and state charges – the town will have $78,476,000 to spend on everything in town with the school's receiving 58 percent of the total or $45,454,000. 

Why so cautious? 

"This is where we think we are at this place in time on revenues when we don't have hard numbers to make better predictions," said David Kale, Belmont's town administrator who is leading the budget process. 

When asked if the town's initial revenue predictions was more a blueprint than a true financial document, Libenson said most of these early estimates are  "placeholders" until the state and town can provide "real" data which should take place in mid- to late-February. 

"[The revenue projections] are the starting point as we have said before and as we get more and more information about different items we will hone those numbers and then have reality reflect our updated forecast," said Libenson. 

As for the School Committee, which expends 58 cents of every dollar raised by the town, the current proposed fiscal 2015 revenue increase of 2 1/2 percent "is far too pessimistic," said Laurie Slap, the School Committee's representative on the Warrant Committee. 

"Unless we have a global disaster, I don't think we are going to end up there," said Slap, who has been part of several school budgets that have not met the goals of the committee and superintendents to advance education in Belmont. 

"Hopefully by February or March, it will be a lot closer to the actual revenue numbers. But I'm not too scared by the current 2 1/2 [percent] number," she said. 
Art Peters December 07, 2013 at 10:13 AM
Franklin! ---"as conservative as Ronald Reagan on his horse"--- Is that an editorial comment or a news item?
Franklin Tucker (Editor) December 07, 2013 at 11:08 AM
Actually, its a phrase I once heard that I always liked; akin to a "yellow-dog Democrat". No editorial intent intended.

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