Would add more than $1 million to Abington’s “rainy day” fund
A number of area towns have started to send out pink slips to employees in anticipation of budgetary challenges during the fiscal year starting July 1.
That’s not the case — so far — in Abington. On Monday night, residents will be asked to approve a $55.5 million municipal budget that is balanced without the need for layoffs or service cuts.
Town Meeting is scheduled to start at 7 p.m. at the middle/high school auditorium. The agenda is limited to just those matters that are time sensitive and can’t wait for later in the year. Attendees are asked to wear masks. A number of new procedures will be in place to keep people safe.
Monday’s budget vote will come with a big asterisk. The state, which is wrestling with a multi-billion shortfall due to the COVID-19-related economic collapse, has yet to provide cities and towns with local aid numbers for the upcoming fiscal year. Abington’s budget takes the state aid figure that was included in Gov. Charlie Baker’s original budget back in January and rolls it back by 10 percent — a figure town officials agreed upon after reviewing aid cuts from the last two recessions. But there’s still a chance that 10 percent cut may not go deep enough, which would then necessitate Abington making additional reductions later this year.
“If we have to go back, that could change,” said Finance Committee Chairman Matt Salah. “But as it stands right now, there shouldn’t be any particular noticeable difference in the level of service.”
The $55.5 million fiscal year ‘21 budget represents a 4 percent spending increase over the current fiscal year. Spending on the town’s schools would increase 4.7 percent, and public safety by 4.8 percent.
Voters will also be asked to approve nearly $8.7 million in capital spending, plus $516,000 in Community Preservation Act allocations. In addition, the town is proposing to place more than $1.1 million in budgetary surpluses into the town’s stabilization fund, which serves as the town’s savings account. Of that $1.1 million more than $900,000 is coming from fiscal year 2019’s budgetary surplus, known as free cash. The transfers will bring the town’s stabilization fund balance to more than $3.1 million.
Abington’s budget writers in March had nearly finalized a $56.1 million budget, but they were forced to return to the drawing board when the COVID-19 pandemic hit, causing the state’s economy to shut down for several weeks. In crafting the revised budget, Acting Town Manager Scott Lambiase, the Finance Committee, and others assumed the possible 10 percent state aid cut will be biggest revenue reduction the town will face this coming year.
The town’s biggest revenue source, property taxes, generally isn’t impacted by economic downturns. Meals taxes and excise taxes, which are consumer driven, could be impacted, however. Salah said town budget writers typically assume zero growth in those taxes. To be safe, the revised budget assumes $300,000 in meals taxes, which would be down from last year’s collection of $340,000.
“It’s not a large portion of the town budget,” he said. “If that drops 10 percent, we’re only talking $30,000.”
The anticipated state aid reduction left budget town officials with a $1.2 million budget hole to fix. The revised town budget eliminates about 10 new positions that were originally proposed, including a town planner and eight teachers, saving approximately $700,000. The rest was made up primarily through revised health insurance costs and departmental spending reductions. The school department, for example, will leave three classroom support positions unfilled when the school year starts.
The town also opted to hold off on several proposed capital projects, in order to place as much money as possible into the stabilization fund.
“We don’t know what the economic fallout is going to be from all this, or the length of the economic fallout, and we wanted to have as much in stabilization as we can in case we need to go in later and save positions,” said Salah.
Abington will likely have a special town meeting later this summer or in early fall, once the state decides to share aid numbers with local communities. During that meeting, voters could be asked to make additional changes to the budget, depending on if state aid numbers come in higher or lower than currently projected.