[Zac Bears]: Special joint session of the Medford City Council and Medford School Committee, April 8th, 2026, is called to order. Mr. Clerk, please call the roll for the City Council.
[Rich Eliseo]: Councilor Tseng, we can't hear you. Yeah, he's in there.
[Zac Bears]: He's unmuted. Did you try to talk, Justin, just so we can look at the little? Yeah, all. Hello? Yeah, OK, I'm President.
[Rich Eliseo]: Vice President Lazzaro. And President Bears.
[Zac Bears]: Present. Six present, one absent. Secretary of the School Committee, Acting Chair.
[Paul Ruseau]: Member Graham.
[Nina Nazarian]: Here.
[Paul Ruseau]: Member Mastraboni. Here. Member Olapade. Member Parks. Here. Member Reinfeld. Present. Member Ruseau, present. Mayor Lungo-Koehn. absent. Five present, two absent. We have a quorum.
[Zac Bears]: All right. Meeting is called to order. We will start with the motions, orders, and resolutions. We have Paper 26-061 offered by President Bears, Annual Budget Process for Fiscal 2027. And I will read out our resolution and then Member Ruseau, if there's anything you'd like to add about the school committee's process up to this point, I'll turn it over to you. And then we will turn it over to, it looks like Director Dickinson and then if there are other members of the administration or if the mayor joins us. Be it resolved by the Medford City Council that based on the budget ordinance and discussions with the city administration, the city council and administration will follow the following budget schedule for the FY 2027 city budget. By March 11th, 2026, city councilors will submit budget recommendations. Tuesday, March 24th, the city council will discuss and refer budget recommendations to the mayor. We did do that. April 8th, 2026, a joint meeting of the city council and school committee to receive a financial update and discuss the fiscal 27 budget process. That's tonight. And then for our side of things from April 15th to May 15th, we will hold preliminary budget meetings with department heads and per ordinance, the mayor will submit a comprehensive budget proposal to the city council by Friday, May 31st, 2026. There's a number of draft scheduled preliminary meetings. They are not finalized between April 15th and May 15th. I will turn it over to Member Ruseau.
[Paul Ruseau]: Thank you. The Medford School Committee's budget preparation and schedule policy BDC has several phases. Phase one is October 1st to December 15th, which is planning, which obviously is long gone and passed. Phase two is budget request formulation, which is from December 15th to February 1st. The school committee and review of approval of the budget request is what we just Well, we didn't quite finish it on Monday. Our next meeting, which is this coming Monday, I believe we'll be hopefully approving that request. After that, it will be submitted to the mayor and city council. And so that's where we're at right now. Thank you. And I see the mayor's here. Mayor, do you wanna come on up? I mean, I can run it if you want, that's fine. All right.
[Zac Bears]: Can certainly join us behind the rail as a member of the school committee. You can come back here with us. We'll turn it over to the administration.
[Breanna Lungo-Koehn]: Thanks. Good evening, everybody. We have Bob Dickinson on the call, our CFO, who prepared a slide presentation, so I'll turn it over to our CFO to get us started. Thank you.
[Zac Bears]: Steve Dickinson, you're recognized.
[Unidentified]: Video.
[Bob Dickinson]: Hi, everyone. I'm remote, which is somewhat not the best way to do this, especially with my somewhat unsure grasp of technology. So I guess I'll just share my screen so that we have the whole budget presentation. It's similar to the ones I've given in prior years. And we can go from there. Wish this was easier.
[Unidentified]: I don't know why.
[Bob Dickinson]: Bear with me, please. All right, can everybody see that?
[Zac Bears]: Yes, we can.
[Bob Dickinson]: Okay. It says financial update. So, this is basically the agenda, the finance department update. Budget update, they didn't change that. Did I? No, I did the 2026 budget update revenue estimates. Various going through the levy limit, et cetera. I'll try to make that short total available for the budget budget 2027 budget impacts revenue expense adjustments going forward. Um, finest department updates. Uh, we've, we completed the state reporting, uh, that was submitted in January. The fiscal 25 books are all closed. The fiscal 2025 audit is complete. The final review of it on the auditor side is tomorrow. So we should be getting, you know, the ACF are, um, hopefully by early next week and it'll be posted to the website for everybody to see and of course shipped off to the various rating agencies and the bond council. Free cash was certified as of 6 30 2025 for 21 million $12,459 retained earnings for water sewer was $10,591,021. As you know, 6-30-2024, a year before free cash, was at $28,343,997. So how do we get back to $21 million? Of the $28 million in free cash that we got at the end of 2024, we used $16 million for essentially capital. It was either transferred to the capital stabilization fund, where it was used to then transferred out of that to be used for various capital projects, or it was voted directly to use for capital projects. So of that money, we had about $12 million remaining. And this year, the big reasons that we got back to $21 million, the motor vehicle excise came in higher than we actually budgeted on page three of the 2025 recap. So we got a bump there. We've had a few, this is true for 2026 too, we've had a few very large building permits coming in. Each of these were above a million dollars. So that obviously is kind of one-time funding. It's not something that you can really expect. but they have come in. We got two of them so far in 2026. We're expecting some more in either 2026 or early 2027. In any event, obviously, I could not expect us to get a check for a million bucks from Tufts, so I didn't have that on the 2025 recap. Departmental revenue, parking revenue has been up as the parking department has cracked down. So we got a bunch there. We advertised for stale checks for people who simply haven't cashed checks that the city has sent them. They're usually small. but they pile up over the years. So I think it was around $400,000 that moved out of tailings because we have it in a reserve in case somebody shows up from mailing or an advertisement and says, hey, you owe me this money. But eventually after two or three years, we say, okay, every few years we can just clean out that account and it goes into tailing revenue and cash. So now we can spend it. Um, police station construction close out. There was a capital project, obviously project fund for building the new police station and after a significant amount of work. on the leftover funding there was determined that a good deal of the expenses actually were inadvertently paid out of the general fund, not paid out of the capital account. And after talking to the auditors and documenting all of this, we were able to move the remaining funds back to where they're supposed to be. Another few hundred thousand dollars went to the police, the public safety casino fund, because that's where all the body cams were bought from, and they should have been charged to this capital project. So again, after this, this takes a lot of work to document and make sure and actually clean all this stuff up. So, but that was a nice bump. Obviously, we can't expect to do that, something like that again. Pilot, payments in lieu of taxes. I had thought that in 2025, we thought the assessor was going to be able to settle the Mystic Valley Development Corporation and move, I think it's 101 Rivers Edge into our tax rolls. So we would have gotten a bump in certified new growth that way, but we would have lowered our Payments in lieu of taxes payment from Rivers Edge. So, it actually didn't end up closing out in 2025. So I had underestimated what our pilot payments would be by about $676,000. This was actually closed out in fiscal 2026. And if you'll recall on the recap, we had a whole bunch of certified new growth because we actually took that stuff and put it under the tax rules, which is great because now the, Now that simply, that will grow as another tax revenue under Proposition 2.5 and won't have to be negotiated. $550,000 hits to free cash. Again, this is cleaning up old special revenue accounts that had deficits. If a special revenue account, a grant account has a deficit in it at the end of the year, and it's not covered by 90-day receipts, then they reduce free cash by that amount. We've been cleaning up, actively cleaning up old special revenue accounts. One of the big ones, and a shout out to the health department, is that the FEMA COVID, they've been after them, FEMA is, I think finally getting to the point where they've actually paid cities back for most of the spending that occurred during COVID. It has taken that long and it has taken the health department working very hard to satisfy their requirements so that we could get those payments. Then 528,000 meals tax, we didn't actually estimate the cannabis receipts because in fiscal 2024, they hadn't opened yet. So we had, you know, we didn't know what to expect. So we estimated that at zero, it actually came in at, you know, a quarter of a million dollars, something like that. And we've upped our estimate for fiscal 2026. So obviously, if anybody has any questions on any of this, just speak up and I will attempt to answer them.
[Zac Bears]: Yeah. Do we want to go slide by slide with questions? If so, you can use the request function on your microphone and either myself or acting chair Rousseau will recognize you.
[Paul Ruseau]: I would certainly have a preference for us to just wait. I hate asking questions that are answered on the next slide.
[Zac Bears]: All right, write down your questions, and we'll take everyone at the end.
[Bob Dickinson]: All righty. General fund budget for this year was $205 million. Medford Public School was $85,490,000. As of March, 76% of that total has been spent. Public schools have spent 72% of their budget. City departments are at 77%. It's that fun time of year where we start looking very hard at budgets, making sure that people close open POs that are not needed, and try to make sure that if they are if any department is hitting the limits of their budget, that we understand why and hopefully get them to curtail their spending. And this is just revenue estimates. This is where they come from. Probably most of you have seen this before in some way, perhaps two and a half. We'll go through this in more detail in further slides. But these are the basic ways that the town, the city can receive more, the bulk of where the city's income comes from. So 2026, the levy limit was 160,857,764. We get another 4 million from Proposition 2 1⁄2. Right now the assessor is estimating new growth at 2.1Million dollars. And he is very firm on that number this year, so I can't expect any sort of last minute, oh, we might be able to get a little bit more than that into the budget. So that's pretty firm, which means that tax levy for this year will probably bring in A little just shy of $167 million. That's about 3.8% more than last year. Local receipts. This is, as we'll get to the end of this, I've been conscious of the fact that I'm usually very conservative with local receipts. especially things like motor vehicle and building permits. Currently, the number I'm using is $25 million. It's actually $600 less than that. Motor vehicle excise, this is pretty much $250,000 more than last year. That's a little below the trend just to have some room there. We may have to go up on that to $250,000 increase over 2025. Hotel and meals, again, this is pretty much in line with the trends that we've been seeing. I increased that by $300,000. Building permits, I touched on this before. We have been getting some, there are some big projects that are coming in, hopefully at the end of this year or next year, which would allow me to estimate A lot more than I did in prior years for building permits, but we'll just have we're going to keep reviewing that and making sure that that number is solid. I say this later on in these slides, but obviously, if we roll into tax the tax recap season. And the DRO looks at 1.5 million. I mean, that's probably, that's a 50% increase over what I said last year. And if they look at that, and it doesn't look, we don't have any reason to assume that we're going to get that amount of money. they will require us to change it. And if that doesn't make the budget add up, then we'll have to call a city council meeting and redo the budget for 2027, which is not something I'd like to have to do. So, which is why I'm fairly conservative about these numbers when I possibly can be. Investment income, interest rates have been pretty steady, if not increasing. It's very uncertain. I've gone up about $250,000 on what we're getting. That looks like it'll come in around there for fiscal 2026 when I project the next few months of interest income. Obviously, in ARPA, we've been getting a lot of interest income because we had all this unspent ARPA money. It's all been properly committed, but while the money still sits in the bank and we haven't paid out for the projects, obviously it's earning interest, and that's general fund revenue. All the projects are committed and all the ARPA money will be paid out by the required date, which is December 31st of 2026. So we'll be spending that money down. I don't think there's that much left. So hopefully, we'll make that amount of investment income, and it won't be a problem. But obviously, investment income is very dependent on what interest rates are. In any event, for fiscal 2027, I'm trying to do the most optimistic estimates I possibly can for local receipts. And we'll see where that gets us. As I said in the prior slide, if we're not looking like we'll be making Any of the categories, if the revenue doesn't look like it's there, then the Department of Revenue will require justification. And if we can't make those targets, if we can't convince them that we're right, we'll have to meet to vote a new budget in 2027. That's the real problem is that the actual tax bills might be delayed. So, cherry sheets. So far, the governor has chimed in. He's saying it's going to give us 36,000,619 charges. There's going to be $14 million worth of charges. So the net cherry sheet revenue is 22,481,873. This isn't a lot more than we got last year. And I've been pouring through prior year's data to see how much ends up in our pockets after the House and the Senate chime in on the cherry sheet charges and receipts. And then they get together in committee and vote for it. And it usually doesn't change that much from the governor's initial proposal. So that goes directly on the recap and is directly, I mean, those are the numbers that I go with. So that's what it's looking like for this year. I think last year we got more like 4 or 5% more than we did in 2025. So that was a nice bump, but we can't expect that this year. Other revenues, transfers, the casino mitigation, money from Encore funds three positions, sale of lots and perpetual care income funds, DPW and cemetery budget, indirect costs, water and sewer enterprise fund is assessed for expenses budgeted in the general fund such as AP and payroll processing. I'm just reading the slide, healthcare expenses and pension. Obviously the water sewer enterprise fund is a separate enterprise fund, but it takes, a fair amount of work and on the general fund side to run payroll and AP. And of course, the healthcare expenses for those employees and the pension benefits for those employees are posted to the general fund. So that's where indirect costs come from. And the number this year, it's about 2.8. I'd have to look it up and I'm too much validate with this computer set up to do that, but it's a, it's a little over 2Million dollars. And I think you've seen these slide this slide before many of the city council members have seen this slide before. That's fairly self explanatory. This is what we're looking at in terms of. how much money we'll actually have available to fund the budget. Basically, a quick spreadsheet of what we talked about earlier.
[Zac Bears]: Bob could you go back to that slide for a minute?
[Bob Dickinson]: Sure.
[Zac Bears]: Thank you. Just trying to get these down and if you could send us the presentation that would be helpful. Thank you.
[Bob Dickinson]: Certainly.
[Zac Bears]: You can send it to the council, the school committee and the city clerk and we'll get it out there.
[Unidentified]: Okay.
[Bob Dickinson]: Let me know when you're ready.
[Zac Bears]: I think we can go ahead. Thanks.
[Bob Dickinson]: All righty. And the budget process for the city, obviously, the assistant finance director, which is the chief of staff and the assistant finance director has been working very, very hard to evaluate departments prior years. Look at. uh obviously contractual obligations how much everybody's each union raises come through who's getting step increases all the nitty-gritty details so she's been doing a great job doing that um also of course looking at expenses we've been analyzing budget actuals for the last five years that's what we do just see what they've actually been doing obviously there's inflation we have to take a look at that to see what departments actually need in order to accomplish their tasks. This is ongoing through May. We'll be working on it hard for the next two months. Once the budgets are finalized, they will be presented to the council and I didn't change that. May 31st, I believe is actually a Sunday. So in any event, under the ordinance, it has to be done by May 31st. So hopefully we'll be able to get it in by Friday, but I just put May 31st because that's what the ordinance says. So impacts, health insurance as usual. Health insurance, the GIC rates are increasing about 9% across the board. It's a little more complicated than that because certain health plans offered by the GIC, some of them have gone up by as much as 14%. Some of them are only up by about 7%. Roughly across the board, we're looking at about a 9% increase. So that's a lot of money, basically. Workers' compensation, I think everybody knows that the GIC's rates have been going up dramatically in the last few years. Workers' compensation, we're over budget for fiscal 2026, and a lot of that, there isn't a lot of that that's actually a, Because of settlements, as that's happened in the past, it's mostly just people getting injured at work and being out for five, six weeks. And obviously, as contracted pay increases, that means that budget has to increase because when people get injured, we have to pay them what they're being paid. So anyway, we're working very hard on figuring out exactly how much money we should need for 2027, but it's one of those sore points in the budget, obviously, because it's very difficult to project exactly how, you know, if somebody will injure themselves. It's impossible to do that, but, you know, over time we can look at how much we've actually spent on these things over the years. But again, it's not, it's, you know, there's no way to be exact about that one. Pension, 2027 budget increase, 4.7% to $17,467,242. The city is still on track to pay off the bulk of the outstanding pension obligations by 2033, at which point this amount will decrease by a lot and we'll just have to fund what is ongoing for each year. But again, these are big numbers, an extra 5% on $17 million is a lot. For 2028, it's going to be a little less than 3.5%, but going forward, it'll be 3.5% according to the current actuary estimate for this. That could change, obviously, depending on the actual amount that we have that the retirement board has right now, it's just shy of $300 million. But if something happens to the stock market, obviously that could evaporate or if things settle down, it can increase. And obviously it's also related to how many people retire and how much money that we need to fund their retirements. Contractual increases, it's over the last few years, the city has managed to settle contracts. And right now, I think all of the contracts are actually settled by this year. But a new round has to start in 2027. When you obviously, when you finally settle a contract. That's been, you know, that hasn't been. Open since, for instance, fiscal, you know, January 1st, 2022. Not only do you have to deal with retro pay, but you also have to put that compounded. Increase into your budget for the next fiscal year. So that's that's ongoing and that's been. that's been the source of a lot of the salary increases over the years. So yes, keep coming back to this. Yes, I'm up to 25 million, but as I've said before, some estimates like building permits, I'm still reviewing them. We might have to change that. Overlay, we've been, We've been funding overlay for the last few years at around $350,000, but in order to keep enough money in the pot to deal with yearly anticipated abatements, we've needed to increase that for this year to $500,000. And again, the new growth, Our assessor has told me $2.1 million and don't go more than that. So I have to take his word for it. In any event, so here's the bad news at the end. Right now, our gap is looking like about $1 million. Department heads have been tasked with proposing reductions. Obviously, we're working with department heads very closely to not only level fund their expenses, and obviously we have to pay what we are contractually obligated for salaries. But also having them put together wish lists for what they think they absolutely do need and what they would like if we happen to have a ton of money lying around. Obviously, the wishes are going to be carefully scrutinized and probably mostly said, well, we can't do that this year. Because in addition to that gap, and that gap is based on our current offer to the school of a 2.75% increase over the city's contribution to the school for Fiscal 2026, there's the Medford Family Network, which has funding requests, raises for non-union staff. We're gonna have to do that probably in early May. And obviously we would like to free up some money to give more money to the schools for fiscal 2026. So that's essentially what is going on in the finance department right now. I guess I can, I think I'm done, yeah.
[Zac Bears]: All right.
[Bob Dickinson]: And I'm sure everybody's got lots of questions. I'll try to answer them as the best I can. I'm trying to stop sharing the screen. Oh, yes.
[Zac Bears]: Bob, if you could leave the presentation up actually. Okay. We'll go to questions from the council and questions from the school committee. We'll start with Vice President Lazzaro.
[Emily Lazzaro]: Thank you for the presentation. I just have one quick follow-up question. It sounded like you said there was a $5 million gap, but the slide said $1 million. Could you just show that slide again and clarify that for me?
[Bob Dickinson]: Oh, it's a $1 million gap right now. It's not $5 million.
[Emily Lazzaro]: Okay. A $1 million get for the whole budget for the city.
[Unidentified]: Right.
[Emily Lazzaro]: Okay. And the total is 217 million and like a little bit more than that.
[Unidentified]: Yeah.
[Emily Lazzaro]: Okay. Got it. Thank you.
[Zac Bears]: On that point, Bob, I'm seeing a discrepancy in the recap spreadsheet versus the cherry sheet slide. So I just tried to take all the data and put it into my spreadsheet and it looks like on the recap we have an estimated state assessments charges of 12.8 million but on the slide it said 14.1 million and so that would reduce the amount for the budget to 216,560. So I'm just wondering what's the right charge number there I'm trying to put together this from the presentation live, so I just want to make sure I'm using the right stuff.
[Bob Dickinson]: It's not something I would like to. I guess that did not carry over. Yeah, it's the $14,137,698.
[Zac Bears]: All right, so if we only have the 216 available, does that change the estimate on the gap from 1 million to 2.3?
[Bob Dickinson]: No, that's, sorry, this slide, frankly, I've never actually really liked it. I don't think it really shows what it needs to show, but, that I simply didn't cut and paste, I thought I had cut and pasted the cherry sheet charges number from my big recap spreadsheet and it's 14,137,698 for that number. So. So what's the total available for the general fund? I'm really confused why that didn't work.
[Zac Bears]: All right, I have it at 118.84, but that's probably a typo on my end. So I'm off by a dollar in my spreadsheet.
[Bob Dickinson]: You're off by a dollar.
[Zac Bears]: That's good.
[Bob Dickinson]: I was off by a million dollars, so yeah.
[Zac Bears]: I just want to make sure that 216.560 is the number that the administration has been using to do the budget projections.
[Bob Dickinson]: Yes.
[Zac Bears]: So the one million is from that.
[Bob Dickinson]: Yes.
[Zac Bears]: Okay, got it. And that assumes also that 1 million gap assumes that the schools would go up. It doesn't include the schools going up to 3%, so that includes schools at 2.75%?
[Bob Dickinson]: Yes, that includes the schools at 2.75%.
[Zac Bears]: Okay, so it's 1 million with the schools at 2.75%. Got it. Do we have any other questions from the Council? And then I'll recognize the Mayor, although you could be up here if you want. You're a member.
[Breanna Lungo-Koehn]: Okay. 1.1, which that slide should have said over, 1.1, then it's 240 for the Medford Family Network. Then it's approximately, we're still working on the figure, but approximately 200,000 for non-union step raises. And then an additional 300,000, a little bit less if we were to give, hopefully give the schools 3%. So you're looking at those figures plus the 1.1. I just wanted to clarify because we didn't have numbers on that last slide.
[Zac Bears]: Okay. So it's more like 1.8. Yeah. Okay. Do you have other questions from members of the council at this time? All right. Member Ruseau.
[Paul Ruseau]: Any questions from members of the school committee?
[Zac Bears]: That's Mike.
[Paul Ruseau]: Yes, I see that, although I've not actually used this before. Yes, you do this. Thank you. And then you do that. All right. Member Mastroboni.
[Mike Mastrobuoni]: Thank you for the presentation, Mr. Dickinson. I know that we're in a similar challenge to a lot of communities all across the Commonwealth. It's difficult. Still good out there for municipal finance. I think one of the first approaches that cities and towns should take is really on the revenue side, trying to solve this type of deficit with revenue. So I'm wondering if there's been any work by the finance department, mayor's department, city departments to change fees for permits, fines, anything like that in order to solve this gap, which again is maybe in $1 million, but does not include a $5 million gap for the school budget?
[Bob Dickinson]: Well, obviously departments review their fees. It's not... I'm not aware of any concerted effort to review all of those fees. A lot of the basic fees that are charged, sometimes they can be simply required by law to be that. I don't think. Unclear on, I mean, obviously the big ones for things like. Building permits and those types and licensing fees. Except for building permits, it's not actually a very large source of revenue. And so, you know, right now I have to I'd have to talk to. departments to see if we can squeeze more revenue out of that with increasing the fees. But as of now, the fees are what we charge.
[Nina Nazarian]: Thank you, President Bears. So in addition to the information shared by our finance director, we have made some adjustments to Board of Health fees. We have made adjustments to parking fees and permits and the like. I know in cooperation with the council, our health director has worked on rodent and potentially other ones. I know there's more, but in addition to that, I'm not calling to mind exactly what they are, because they've been over time. And then in addition to that, I think the council certainly knows, I think the community knows, the school committee probably knows as well. We've been working for the last several years, half a dozen now, on economic development. There have been, obviously, market changes and changes beyond the control of the city. But historically, new growth was much lower than the new growth numbers we see today. So there's more. I'm sure there's more areas that we can identify. But as of right now, those are the ones that are calling to mind.
[Unidentified]: Thank you.
[Zac Bears]: Thank you and you know the city council did submit a resolution in early 2024 to the administration to request a comprehensive review of all of the fees. But that effort I think it sounds like pieces of it have happened but we have not had a meeting about that.
[Paul Ruseau]: Anybody else? I can't really see.
[Zac Bears]: Now I know what it's like. No hands on Zoom. If you press your request button.
[Paul Ruseau]: Yes, of course. Member Mastroboni. All right.
[Mike Mastrobuoni]: Thank you, Mr. Chair. So one of the things I noticed that was really positive from the presentation was the jump in building permit projections for next year. Are we at liberty to share what those projects are? I know that that's like an anxiety producing projection for a finance professional. So do we have a set of projects that we're identifying those building permits for? And if so, if we can share that, what are they? And then secondarily, do we have projections for future years for new growth? How are we feeling, excuse me, that these building permits will benefit us in the long run? Again, I see a revenue deficit here in the longterm, and it's something that I think is really important to tackle first.
[Bob Dickinson]: This is with talks with the building commissioner. There's a bunch of There are a bunch of projects on the horizon, but obviously, as we know, with large building projects, they can be delayed for years for any number of reasons. This is why we are continuously reviewing this number to see whether or not it will actually come and I can actually justify that increase. I will be talking with the planning department and the building commissioner to see exactly as the next month unfolds, to see exactly what we are looking at, what we can expect for the next few years. and going forward, what is on the horizon. Obviously, this type of revenue is good because once, especially, I know there's two 40B apartment units going in, and not only does that give us building permit revenue, in the near future, but once they are occupied, obviously that adds to the city's tax rolls. So that goes to certified new growth. But trying to forecast something like that out to what might happen in fiscal 2028 or 2029, that's not really possible.
[Mike Mastrobuoni]: Thank you, that's really helpful. Just a suggestion, hopefully for next time that we do this presentation or the next time we're talking revenue, I think as a new member of the school committee, it'd be really helpful to have a little bit of longitudinal data in this presentation so we can understand where we're coming from. That would be personally helpful to me and I hope I speak for some of my colleagues as well. Looking forward to that in the next version.
[Jenny Graham]: Member Graham. Thank you. Sorry, I can't be there in person tonight. But I had one comment and one question. My comment is that I would encourage our council friends to watch the budget presentation that we did on Monday evening. I think it is the first step in our process to understand what the requests are. And certainly those numbers will all change over time, but the 2.75% or even the 3% would not be nearly enough to cover even our contractual obligations or some of the what were called Monday night unavoidable expenses that we will have to carry into 2027 around student support. So I just wanted to call that out and make sure that folks can tune into that presentation to understand where our budget is at because it is obviously the largest budget portion of the city's overall budget. And there are confluence of events on our side that I think are going to exacerbate this and I just want to be fully transparent about what those numbers are so that we can all work together to complete the plan. The second thing I wanted to ask was where does the city handle or document its revenue projections, both like sort of what has happened in the past, but it's actual, and then also into the future so that if we are looking forward to big changes, which feels like we sort of always are, how do we get ahead of those instead of sort of finding ourselves in this like uncomfortable April, May, June period where we're having to react. And I know projections are just that they're like our best estimate, but we talk a lot about development in the city and the focus on economic development. Those things translate to dollars. So I'm just trying to understand like, where's that bigger picture that looks out five and 10 years from now so that we can all be grounded in the same sort of outlook.
[Bob Dickinson]: Okay, well, in terms of revenue projections, I do do revenue projections that all of this data comes from. I frequently joke that if you ask me a question, what you get back is a very, very large spreadsheet. And the spreadsheet that runs all of these projections is just that. It's a very large spreadsheet. It has, for instance, just the Cherry Sheet page has our Cherry Sheet revenues for the last six, seven years. and then estimates based on what we've seen to try and figure out what the final number for cherry sheets is. I have the revenues broken up for local receipts going back four or five years at least, which is how we make the decisions on what we can expect. For instance, motor vehicle excise tax, what we can pull out what we can actually reasonably expect for the coming years. It's an awful lot of data that these projections are composed of. There's a great deal that goes into it. So that's simply how it is. It's a very large spreadsheet that links tabs to the final page, which is basically what goes on the recap. We could probably work some way for those projections to be made more I don't know, honestly.
[Zac Bears]: We love spreadsheets. We love spreadsheets.
[Bob Dickinson]: I don't know how I can compact this thing to something that's particularly handy, to put it mildly. But yes, we do. I do do this. I look at this very closely because obviously, you know, this is the crux of how the city gets run.
[Zac Bears]: Thank you. Madam Chief of Staff.
[Nina Nazarian]: Thank you, President Bears, and through you to the council and the school committee, Chair Russo. We do have a lot of this information contained in the budget book that's published on the city website. There are projections going out, Bob can correct me if I've got this wrong, but I think five years. And there's historical information as well. But the reality of the situation is what you project today is going to be different than the reality tomorrow. There's only so much that you can see from today for what exists in the future. That happens in every city and town and every community in Massachusetts. I can't speak to outside the state, but there's only so much that can be foreseen. And then there's changes to that plan or changes to those projections. Thank you.
[Zac Bears]: Thank you, and if you don't mind, Acting Chair Rousseau, I think that point's really well taken. the estimates will change and we are underestimating local receipts by three to $7 million a year for the last four or five fiscal years. And I think when we're talking about, and I'm using the DLS data, you know, for fiscal 25, we had a 21.1 million and we came in at 27.1, so that's about 6 million. For 2024, we estimated 18.4. We came in at 24.6. That's a little over 6 million. 23 was a little better. It was estimated 18.5, came in at 21.6. That's 3 million, 2022. And I get once we get back into 21 and 22, we're talking about some pandemic affected data, you know, estimated at 15.1 and came in at 22. I think we really need to take a look. I mean, it would be really helpful to understand kind of what our projection is for fiscal 26. We estimated 22.8. 22.9 million, are we coming in at 28 or 29 again? Cuz we could really shave a significant chunk off. I know we're talking about $1.8 million gap, and I'm guessing that means level service plus city department requests plus the three things that the mayor said. I don't know, I'm hoping it means that. And then on the school side, it sounds like level service is certainly another 3 or 4 million, or I'm not 100% sure. I wasn't able to watch last night, 4. And so our budget gap for a level service budget is looking at 5 million or more. And I think we really need that data presented. The top ask of the city council in our budget recommendations was that we have a level service budget that doesn't have layoffs and cuts. And I understand that's difficult. We're in a difficult environment. That's one reason for, you know, four years ago now, Councilor Collins and I were advocating for a stabilization override that was of a, you know, higher amount than what we ended up getting on the ballot in 2024, because we didn't want to end up in this position. But it really seems to me that we need to take a hard look at our local receipts estimates. Obviously, they need to be justified, and it's a big fight with DLS, and we've heard that from Bob. But we're overshooting by, 6 million. And I don't know, again, if you guys have data on 26 that shows that our 22.8 estimate is close to our actuals on local receipts, that's helpful data to have to show that gap is coming down. But if we're talking about a three to $6 million gap and we're overshooting local receipts by 6 million, I think that's one place to look at trying to avoid cuts and avoid a budget that's less than level service. So I do have another question in addition to if you can provide an estimate on what we're gonna get for local receipts, how we're doing nine months in, and also I'd really like to see that gap with an understanding related to the school request, as well as what they've said level service will be, and also library trustees. And then my last thing is, Bob, you mentioned that we're still finalizing some of the insurance and workers comp, and I'm wondering how much that might impact the $1.8 to $5.8 million gap that we're talking about for a level service budget. And I'll, the mayor, I don't know if I have to recognize you, because you're part of this meeting.
[Breanna Lungo-Koehn]: Thanks. I'll turn it to Bob. I just wanted to point out we did ask him to review local receipts and bring that up a bit, but we'll do it again. So we'll take another look at local receipts because we don't disagree as we're reviewing the numbers. And I just wanted to point out that this is the last tough year from COVID and the ARPA funding running out. ARPA funds run through December 31st, 2026. So any positions we have either partially funded or fully funded through ARPA, you'll see in this budget that we need to absorb those five positions on, on the city side for that six month period. So it's, I just, it's somewhat level funded, but we do have to absorb some of the staffing.
[Zac Bears]: You're muted, Bob. You are on mute.
[Bob Dickinson]: It's down there. Yes, as the mayor said, that's what I've been trying to do. I've been looking at the revenues. I don't actually have that data at my fingertips right now. We'll probably get a nice, well, I know one thing that we'll get from fiscal 26 free cash, Is that we had to building permits come in that total 2.5Million dollars. I mean, that was not estimated. And that's why I've been able that's why I'm. You know, trying to goose the local receipt number for building permits is because in the last few years, we've gotten these nice. These nice surprises the. Obviously, you know, 2Million dollars in building permits that wasn't estimated for local receipts. That's going to fall free cash in 2026. As of June 30th, 2026, so. But I'm reviewing these numbers closely. I'm trying to go as high as I can on local receipts, because I realized in the last few years, I've been trying to be very conservative, especially when I first started here, because I didn't know how the city was going to recover from COVID. There's other parts of local receipts that we might be able to make a case for increasing. But again, this is kind of standard for finance directors. You try to hold back on local receipts just so you don't end up with a revenue deficit. It's probably less of a concern in the city council government because you guys meet every 2 weeks. The town where it came from, if you have a revenue deficit, you have to call a town meeting in order to fix it, which is expensive and hard to do. Yes, obviously, I'm looking at those numbers very closely and trying to see where I can justifiably increase my estimates for local receipts. In terms of the insurance budget, It gets very complicated because I'm looking at not only GIC health insurance, which is obviously a huge chunk of that. I'm trying in real time to get the data for who's employed by the city right now and which plan they are on and put in the numbers for what their 2027 rates will be. Because of course, depending on the plan, the city pays 82.5% or 85% of that number. But there has to be some leeway in that budget because that doesn't account for any new hires, any changes, if a position is now vacant but needs to be filled and it's filled by somebody who, for instance, is on the family plan, that can affect those numbers. So we need to actually have some extra funding for GIC just to make sure that we can cover that. And then the other numbers that go into insurance are, well, a big one is the Medicare expenses on the school side and on the city side. Obviously, the city has to match the Medicare deduction for FECA. So as employees make more money because of contractual agreements, necessarily that number has to go up and it's not inconsiderable. It's probably a couple of million dollars. So that's another one of those costs that's born on the city, that's born by the city for all of the city employees. So that's the kind of thing we're looking at very closely. The number that we need for that might go up. I'm hoping I can make a good case for it going down, but right now that's the best estimate that I have. So I look at historical data and try and figure out as best I can what it's likely to cost. And that's the same for workers' comp. As I said, workers' comp earlier, that's, it's hard to say. It's hard to say who will be injured next year. You want to have at least a little bit of room there in case claims, you know, you get a large claim or, you know, somebody's out for an extended period of time. It's not something that you can really rationally predict.
[Zac Bears]: OK, yeah, and I think that's helpful to understand, you know, this number. It's more than a million. With the three items that the mayor mentioned, level of service on the school side seems to be a few million more, and there's some uncertainty around some of the insurance costs it seems like at this point that could, you know, could that uncertainty bump us up another $500,000? PB, Harmon Zuckerman. PB, Harmon Zuckerman. PB, Harmon Zuckerman. PB, Harmon Zuckerman. PB, Harmon Zuckerman. PB, Harmon Zuckerman.
[Bob Dickinson]: 100,000 or 200,000 each way. I've gone through the data once already, and I'm going to go through the data again, obviously. That's what I do.
[Zac Bears]: So it sounds like, from what I've heard, we're looking for about somewhere probably not more than $5 million. That's the gap if we include certainly the school side. Thanks for letting me go.
[Paul Ruseau]: Is this the mic out there? Yeah. Okay. Member Reinfeld.
[Erika Reinfeld]: Thank you, and I do want to thank everyone who's been working on the budgets. I know this is hard work, and I don't know, budgets are probably my least favorite thing of project management after trying to schedule meetings with lots of people. But I have a non-numbers question. I'm wondering if you can, I'm hoping you can tell us a little bit about the priorities for this budget season as we're looking to close the gap to try to move between level funding and level services, because that's a distinction that I think we're really wrestling with here. I'm just wondering what the driving values behind figuring out the budget and what can increase, what needs to get cut. And for context, I'm looking at the school budget presentation that we got on Monday, which I think There was an argument to be made that what was presented was higher than the financial scenario, the landscape that we just saw presented to us can bear in the current projections. That budget was very much aligned with the school district's instructional vision and what we were trying to achieve. And so my question, I guess, to the city and the process of the budget here is, what are the guiding principles for this that we're really trying to meet? Obviously, as a school committee member, my priority is to fully fund what the schools need. And that's my question, kind of away from the numbers. What's going to drive those decisions on how the numbers play out?
[Breanna Lungo-Koehn]: Overall, it's balancing a budget, but I think since this is my seventh budget, I've, you know, we've shown, especially the first several years, the schools were a priority. I think there was one year that we were able to give upwards of 10% to try to boost that side of the budget. But overall, it's just trying to keep everything balanced, not having cuts, and keeping, we all have many priorities from trees, parks, affordable housing, to food insecurity, and making sure our connectors, I know that was one Council's request making sure our connector program and liaison program is still intact. So trying to minimize cuts and balance a budget that nobody's happy with but that we have to live with while getting out of the ARPA funding. dealing with the high increases in things that Bob mentioned such as health insurance and the whole host of increases that are over that 2.5% taxable amount to our residents. Every city in sound is dealing with it and I'll let Nina close out.
[Nina Nazarian]: The only other thing I'd add is what we do on the city side is we use a lot of creative vision. There's a lot of discussions to try to figure out how to meet the visions with alternative methods. We have some of the most talented department heads and folks that work in those departments who write some of the most creative grants and some of the most creative solutions to problems to meet the needs of the organization and still further the mission of the city. I really, I think every time I kind of come in. I'm learning about a new grant that's being applied for by many of our different departments. The thoughtful and collaborative ways that they're working with our office, with each other, to try to figure out how to present a grant that would be compelling to the grantor and successful for the city. And we've been very successful over the years with so, so many grants. So, and I know, I mean, I've sat at various conference tables, whether it's the mayor's conference table or another conference table, and we're, The mayor has come up with creative solutions to use alternative funding sources. I remember one of the first times I began working on projects in this organization, we were starting the process to get our fire stations, our substations resolved, and it wasn't how do we go to the tax dollars, it was what available sources do we have? We have community preservation funding, and so utilizing those to the best. CPA comes up all the time in terms of, like, digitization, for instance. We might have, if, let's say, for instance, in the few times I've heard that we've been unsuccessful for a grant, just recently this week, we were talking about, okay, well, actually, CPA could help with that digitization piece that you're talking about, where we weren't able to get it from over here, but we could consider that avenue. So we're constantly having those conversations to try to figure out, alternative methods to solving and moving the mission forward because we have had these constraints and we have been trying very hard to be mindful. We also are regularly looking at efficiencies that we can gain, whether that's department Centralization, you know, for years this community didn't have a facilities director that had an effect on our facilities that we're making up for now. And so the centralization of all the facilities budgets or centralization and professionalizing of the IT and the infrastructure behind the IT. all of these pieces eliminate liabilities and create reliability that helps streamline and reduce costs in the long run. So I hope that between those two that answers the question.
[Unidentified]: Sorry.
[Erika Reinfeld]: That's because I turned off my microphone. Thank you. So I would love to see that in some of the department presentations. I admit I don't watch them all, but I do tune in and it's really helpful for understanding the context of why things are happening the way they are, because this is a challenging time across all cities and towns, as you said. I learned about some new things that were happening, and I appreciate that, and I'm excited to see that presented side by side with the forward projection.
[Paul Ruseau]: Member Mastrobonni.
[Mike Mastrobuoni]: Thank you, Mr. Chair. Two quick ARPA questions. I think the first is to CFO Dickinson. Have we been accruing our ARPA interest year over year, or is this a one-year? Is that money sitting in an account in a fund, and we're all accruing that this coming year? I know that we have to close out those grant funds on 12-31, so that's a pretty specific question. I can wait for an answer on that one for the next question.
[Bob Dickinson]: Under the guidelines for ARPA, the interest revenue for the ARPA funding is general revenues of the city or the municipality. So they make up part of the investment income of the city.
[Mike Mastrobuoni]: So you're saying we've been posting that to the general fund on an ongoing basis for the last few years? Yes. OK. Yes. All right. Awesome. And second, I think. We heard from Mayor Lungo-Koehn that we'll be adding some ARPA funded positions onto the general fund this year. I'm really interested in what those positions are and what the process was to compare those to funding those new positions on the general fund to preserving other services and avoiding cuts on the general fund. That's really important to me. I think when we created these ARPA positions, we know that they were I'm just wondering what the process has been to compare those to avoiding cuts.
[Nina Nazarian]: I'm happy to answer that question. So I need to formulate a comprehensive list in one place on this question, but I can think of about four or so positions. The mayor mentioned it would be the last year. I would augment that slightly and say it's because of the half-year impact, it's going to also bleed into the following year. Nevertheless, I mean, I think her intent was to indicate that, you know, we have to have spent all of our ARPA funds by 12-31-2026. But I believe we have about four positions. Some of them are, we've already started moving some of the positions because, look, I think it's fairly well known that we can always use more positions both on the city side and on the school side. I think that's evident by our, nearby communities and the work that every other community is able to do with the staff that they're doing. And we have, in particular, the federal funds manager who has been managing the ARPA funds. Again, through creative and thoughtful and necessary, through needs that exist, that position has already been partially moved on to managing and being responsible for one of our other large grants, which is our casino mitigation and the competitive casino opportunities that exist, although those numbers have dwindled quite a bit lately, which the mayor has been working hard with many department heads and others to get support from the state legislature to increase. And there's been some upward traction, which is positive. We also have some of our positions like our communications specialist that is in our communications department in the mayor's office, which in the last year has been doing a significant amount of work with regard to communications pertaining to our office of outreach and prevention under our health department. And that position was effectively funded at about 70% through the Barr Foundation for the last four years. maybe two years roughly, I'm guesstimating right now off the top of my head. And the Office of Outreach and Prevention has been working on furthering the conversations with the Barr Foundation to continue that work. It sounds to me, and I don't know if this is, there's nothing official yet, but I know that the Barr Foundation is interested in continuing the partnership with the city, but it's likely gonna be at a lower number. I know that there's behavioral health grants that they're looking into applying for and incorporating the communications specialist into As we work to balance a budget, you know, we may have to try to figure out other creative solutions. There are others that we've got at least one position that's potentially being charged to four or five different funds. And the same can be said for our Outreach of, Office of Outreach and Prevention. I'll say OPO from now on, now that I've defined it. But in their case, they have a number of different positions that are paid for through other grants. These are the types of creative solutions that we come up with. I know I'm forgetting a position or two or more, but then there's MVP grant. I think we've, OPO and the health department and our PDS and other stakeholders have kind of been leading the cutting edge. I think this city submitted one of the first MVP grants that was out of the box thinking. that has resulted in supporting staff. There is each budget that we go through, we are looking at what the status of grant-funded positions are, what the long-term viability of those grant-funded positions are, and what alternative sources of funding could be to retain the staff because there's a continuation of work that needs to be done. I don't know if I answered your question fully, but at least got, I think, 75% of it in terms of what's in my brain. Thank you.
[Paul Ruseau]: Thank you. I have a few of my own questions, if I may. Anybody else want to go first? All right. The NPS slide on slide six listed that we received $85,490,000. Our budget last year was $86,575,549. Could you help me understand that difference? Because, I mean, if we didn't get that additional money from the override, then we would have had 40-something people laid off in January. So, which number is it? that we should be basing our budget on. Thank you.
[Bob Dickinson]: The $85,490,000 was what the city is, what was voted for the school's 2026 budget. Any additional fundings would have been from the school's stabilization fund from the leftover money that was unspent for the year that the overrides passed.
[Paul Ruseau]: So that's what the city, yeah. So would a level funded budget would be $85,490,000?
[Bob Dickinson]: Well, plus the, I'm trying to get these numbers, make sure I'm getting the numbers correctly. The 20, yeah, the 2026 budget was the 85,000,490, right?
[Paul Ruseau]: So a level, if we do level funding in the district, we will receive 85. I'm not saying we're getting, nobody's asking us to do that, but a level funded if we had to, it would be 85,000,490. and we would lay off literally a couple hundred.
[Bob Dickinson]: No, no, no, no. The 2026 budget is 85, 490. What the city proposed for the school for, and that we're trying to obviously find more money for the schools, is 87, 849.75.
[Paul Ruseau]: The member of public schools and the school committee operated under a belief that we were spending $86,575,549,000 for FY26, which is in fact how we have been operating. I just think the word budget is wrong. I frankly don't feel like it's being used correctly here because that is the money we had that we received from the city in FY26 without coming here for an additional request for allocation. That's the money we had.
[Bob Dickinson]: Okay, technically that's incorrect. If that's the budget you've been working with, that actually, I mean, I'm just going to bring this up with CFO Velez. If that is the 85,490 plus, I believe it's 1,000,028 that was supposed to be coming out of the stabilization fund to fund the 2026 budget. That has not been voted yet, to my knowledge. So in order to have that money available for the 2026 budget, there would have to be a city council vote to move the money out of the stabilization fund into the general fund to fund to be put in the school's budget.
[Zac Bears]: So just to start to interrupt member Rousseau, our understanding of this Last year, and I think we'd have to go look back at the votes, but our understanding of it was that the stabilization fund from the questions seven and eight votes in 2024 was designed to be spent down as a ramp, but would function as the base amounts for the schools. And we were using a ramp because we were going to use revenue in future years. But I think just to try to bridge the gap here, the idea was 85,490 out of the general fund, 1.1 million out of the stabilization. But that's functioning as your base for fiscal 27. That's certainly what my understanding of it was. And the ramp concept was that it was essentially a fund that would allow us to bring the base up over time and absorb that cost over, I think it was two or three fiscal years. for the general fund allocation to Medford Public Schools. So that's the understanding. So I think the schools operating from the presumption that the base for fiscal 27 would be the The fiscal 26 number of those two things combined, that's also the understanding that I share. Now if we need to again look at that stabilization for year two of the ramp, I think that that makes sense. But I don't think it's fair to say that the 85-490 is the base for And to say that the number proposed represents a 2.75% increase, because the schools have been operating from the idea that this stabilization money was helping to provide a ramp. And the budget issues and the needs that they're facing. So that's my recollection from the meetings. If there's a vote issue here, my understanding is we approved everything necessary. But if we need to discuss that further. I'll turn it back over to Acting Chair Rousseau.
[Nina Nazarian]: Yes, thank you, Chair Rousseau and President Bears. I just wanted to say that I think we agree that there's a ramp. I think we agree that it was added to the budget. I think adding it to the base is probably different than my understanding. think of our finance director's understanding and the mayor's understanding, but the finance director can correct me if he had a different understanding. But I think we've even been clear in our communications about that number when transmitting the budget. But perhaps we need to talk this through a little bit further and try to figure something out because it sounds like some folks have one understanding and other folks have a different understanding.
[Paul Ruseau]: Thank you. I mean, the override increases the base. That is the entire point of an override. So to think that it would increase the base, but that base just moves on to the city's coffers and not the school's coffers, when the money was an override for the schools, to me is illogical and frankly, I'd be offended as a taxpayer to think that I increased the taxes for the schools. but just for one year.
[Nina Nazarian]: Please, this is super important. I want to be very clear about this. I think we're talking about two different things. I'm checking my numbers in my head. The $7 million that was between both override questions have gone to the schools and directly to the schools. Nowhere else, and they will continue to go to the schools as far as I understand the plan. The difference of what we're talking about is the $4 million that was voted in. Sorry, can I answer just a direct?
[Paul Ruseau]: It's $7 million every year.
[Nina Nazarian]: Correct. We're in agreement on that.
[Paul Ruseau]: Okay, so the budget before the override was $85 million. No, no, no, no. Sorry.
[Zac Bears]: The budget before, it's $7 million once and then every year.
[Paul Ruseau]: Right. My point is it's, it's.
[Zac Bears]: But it's not an additional $7 million.
[Paul Ruseau]: No, it's not, but every year that new level is expected to come to the schools.
[Zac Bears]: It went from $71 to $83, and that included the $7 million plus part of it, and then it was the $85. I think what Nina's saying is, that the $4 million, because it was assessed on the fiscal 25, that's creating a ramp.
[Nina Nazarian]: But I think my understanding is- It didn't get fully spent, so we took those dollars before they closed to free cash, set them aside for the school committee, school department, schools in general only to be used in the following years as broken down. And so those numbers have been added to the base budget. They are not a part of the base budget, because that's two very different things.
[Zac Bears]: Right, but I think the understanding maybe where the disagreement is, is that it was essentially meant to lessen the impact of the increases over the following fiscal year. So that in the subsequent fiscal year, the base should be the general fund allocation plus the stabilization allocation. If that, that's my understanding.
[Nina Nazarian]: But that's, that's putting that, logically in my mind that doesn't make sense with all due respect, because that's putting an override into the base, two, two overrides, let's call it one, $7 million override into the base. We're putting a 2.75 factor on that override. And then, I think what, from a calculation standpoint is being discussed here and is being suggested is that you're then adding the amount that wasn't spent in fiscal 20, Was it five or six? Five, thank you. And then you're breaking that into a few years, and then you're saying we are adding 2.75% to that as well, which is like, that's like double counting. That doesn't, that doesn't mathematically work logically. It is double counting. Okay.
[Paul Ruseau]: Which is why we didn't lay off 40 something employees.
[Nina Nazarian]: Right, I'm not, I don't have an issue.
[Paul Ruseau]: If we don't double count, we're going right back to before the override, and we're going to have massive layoffs. I mean, double counting is the point.
[Zac Bears]: Well, I wouldn't say double counting is the point, but I think the point was that the schools need more than 2.75 a year, and the stabilization fund could mitigate the impact of something more like a five.
[Nina Nazarian]: And effectively, what the schools are getting is greater than 2.75 because it's 2.75 on the original base plus the seven million, so it's 2.75 on all of that, plus on top of that is the additional amount that's being carried from year to year through the stabilization fund. So we are talking about more than 2.75.
[Zac Bears]: Right. But in the final year, I get what you're saying. Right. You're saying the base should be based on the general fund allocation. We went up to 83. Then we went up to 85, 490. I'll have to do the math on that. But that's probably around three. For me. Bob has a stand up. Yeah.
[Bob Dickinson]: The fiscal 2025 budget started out at $76 million. With the overrides, it was $83 million. Of that, $2.185 million was not spent and put in the stabilization fund. The fiscal 2026 budget is 85,490 million. That's a 3% increase above the $83 million. So the override money was increased for the 26 budget. It didn't go to the city at all. It was the number that we gave the 3% increase for 2026 included those two overrides. So that's where that's where we got to the 85, 490 just want to be clear about that. And then the 2.185 that's in the stabilization fund was unspent money from the fiscal 2025 budget.
[Nina Nazarian]: And the only other thing I'll add is this was a creative solution that was a collaboration between school committee members, city council members, the mayor, to try to figure out how to ensure that we didn't lose that remainder, that $2.185 million, to have it, I don't want to say lose it, because it's never really lost, but close it to free cash. The creative solution was to come up with a stabilization fund to retain it for schools. Nobody has ever discussed, I want to be very clear about this for the public, because I know we're kind of working through these thoughts as a group right now, but I want to be very clear to anyone who's watching that nobody has ever discussed doing anything but sending $7 million every year to the schools.
[Zac Bears]: Right, I think where we're coming up on a disagreement here, or at least a different understanding from my perspective is that 2 million was to be parceled out over, I think, three fiscal years. And that it should be above the 3%. So that by the end of that ramp, the schools, then the general fund budget could then sustain an increase of more than 3% in the following year. And it sounds like what you're saying is that the stabilization fund was to mitigate the cost impact of 3% increases over the three fiscal years.
[Nina Nazarian]: President Bears, I'm not entirely sure I'm following you exactly, and I want, this is important, and I agree with everyone that this is an important subject, so perhaps we should kind of just have a little bit of a working conversation, because I want to make sure I'm responding to the question accurately, and I don't want to misunderstand. And I can go on, and we can try to figure this out, but it might be better to put pen to paper and make sure we're mathematically talking about the same numbers.
[Zac Bears]: That's fine, yeah. I just think, you know, it seems like the schools are operating from the perspective that they're looking at the difference between 87-something, 87.5 and 86.5, and the city is talking about doing something more like 87.8 and 85.5. And that's where some of the difference is coming from. So I think we need to work that out. And we need to understand, again, because it's not in here, what's the year two stabilization amount that's going to the schools? And how should the schools budget for and expect this year and the next year? That's the end of the stabilization money. And then what does the long term forecast look like for the allocation to Medford Public Schools from the general fund? So that's just what I'm trying to get to. It sounds like there's maybe two different understandings of how the schools should expect to use those funds on the city side and the school side that we need to get an alignment on.
[Paul Ruseau]: I would like to know how this works in other communities. I appreciate that we tried to do something creatively because we were short on time in the fiscal year after the overrides passed, but There's very little chance that we're the only folks who've had to deal with this. So, I mean, when we've finished all the stabilization funds and we've not added any of those to the base year after year, then we're going to be looking at a massive shortfall. Like this year is going to look nice and fun compared to that year. So I want to know how other communities do this because I'm not clear. I really was 100% under the impression that this stabilization addition was an addition to the base. And, you know, I think that we're getting a 1.57% increase. You all think we're getting a 2.75% increase. We both cannot be right. And so, if I'm wrong, I'm wrong. And I hope if you're wrong, you're wrong. And we can own that. But whatever the increase is, we need to figure out how to come to agreement on whether it's 1.57 or 2.75. I mean, we won't ever end those numbers anyways. But because there's this year, which we have to grapple with, but if it's never going to be added to the base, I'm really terrified when we're done with our stabilization funds. Because we're going to be talking about, we're going to be either needing, I'm not going to say it out loud. But I think we beat this to, this horse, it's to a pulp.
[Nina Nazarian]: If I could. Sure. One more thing. And I don't have a problem admitting when I'm wrong. But I don't know as though this is going to come down to wrong. Unfortunately, because of the interpretations, this is a, This is more, in my mind, a potential. Again, I'm not entirely following all the details, so it's too important to off-the-cuff respond on something, but I don't think this is gonna, if we have a difference of how we see this in the calculation, it's not likely gonna be a wrong or a right on either side. It's going to be an interpretation and an understanding difference. That's my opinion. That said, to clarify one further time, The current school department budget contains $7 million that was voted in override. If we've taken part of that $7 million from a prior year, namely $2.185 million from fiscal 25, that wasn't spent in fiscal 25, so only effectively 5, a little under 5 million was spent in fiscal 25. We've taken $2.185 million out of fiscal 25 and we've moved it and we've effectively spread it out over multiple years. What we're actually saying is $7 million is going to the schools each year thereafter. And on top of that $7 million, however much is appropriated from that stabilization fund, let's just use round numbers, I don't know, 750,000 each year for three years just to smooth it out because I don't have the numbers in front of me, but those numbers were all laid out in the time of the discussions, then we're really saying that we've appropriated an additional $7.75 million to the school department budget. I just want to be very clear about that at this stage.
[Zac Bears]: I think that's what I'm saying and I think it goes back to the understanding pretty soon, you know, quite frankly two years before we even picked the final override number that 7 million was something but it wasn't enough. And I think we're seeing that in the school committee budget request which is that level service funding that 2.75% even on the, even if it's on the general fund allocation plus the stabilization allocation is not sufficient to maintain level services in Medford Public Schools. And so I think what we're going to is, The override was helpful. It addressed a number of issues. You know, if we didn't have it, we'd be talking about a $12 million budget gap this year, which frankly is in line with what a lot of other communities are seeing. I mean, we're seeing overrides of 7, 10, 12, 20 million in relatively comparable communities. And I think it's really saying that when we created the Stabilization Fund, at least from my understanding, it was The city's going to have to do more than 2.75% a year for the schools if we're going to even be close to level service. The stabilization fund can help us do a little more than that every year. And, you know, hopefully by year two, year three, and certainly year four when stabilization funds are depleted, then we will have an alternative approach and the city will have done additional work on budgeting, revenue strategy, growth. development, whatever it may be, or say, you know, yes, we're still in a really difficult position and the choice is that we have to go back to the ballot or we have to make significant cuts. And I think in some ways we're actually seeing that right now because we're facing similar fiscal conditions to most other cities and towns across the commonwealth relative to GIC and other growing costs. Yeah, that's what I'm saying. I understand if there's a difference of opinion and interpretation in some ways on this, but my understanding of it was essentially that we knew the override was not enough to address the city's fiscal issues. And I think we're seeing a lot of comparable, all of our comp cities and towns are basically facing that, unless they're Cambridge or Waltham.
[Paul Ruseau]: Thank you. Do we know why the motor vehicle excise tax was so dramatically higher? And well, do we know why? And is there any reason to think that that increase is not going to continue? And interest rates have not been great. So they are a little lower. I mean, that seems like a very large difference. And, I mean, a lot of new people didn't move into Medford to buy cars. It's just a lot of excise tax. So, you know, every dollar that we underestimate will eventually mean pressure on whether or not we'll do more layoffs in the Medford public schools. I'm not going to stop saying that out loud because I think The difference right now is so large that that is an absolute, unless we can figure out how to find another, well, I'm not going to say creative solution, but find a way to, to fund the, the school committee's budget. But, you know, I know President Bears has already talked about the, receipts, but I was just looking at the motor vehicle. I mean, $1.1 million extra is a lot of money. So how are we estimating it? And do we have a reason to trust that?
[Bob Dickinson]: Well, quite frankly, for prior years, I've been very conservative on my estimates for local receipts. Because we could balance the budget that way. We could still balance the budget and do that. Obviously, this year, that's not the case. And I really am pushing everything that I possibly can. I've been looking at motor vehicle receipts for the last several years when I'm formulating my calculations for what I can put down for local receipts. There might be some extra money there, but again, you know, local receipts as a whole are probably being pushed to the limit. So in prior years, I would be conservative about them, but thinking that, you know, not being able to fully predict the future, I wish I could. You know, I have to go on the data that I have, and right now, that's what it's looking like for page 3 local receipts. I'm projecting $7.5 million. We got a little bit more than that in 2025. So that one number might be able to go up, but if it goes up, it's only gonna go up by maybe a couple hundred thousand dollars. I might be able to push that. I tend to look at local receipts as the bottom line number that we have to make in city revenue. And obviously local receipts are something that is very, it's not like prop two and a half. We know we can bill out for prop two and a half. For local receipts, it's a total number that the city has to, as I said, we have to justify that to DOR when we come up to the tax recap.
[Paul Ruseau]: Thank you, Bob. I have a question about that tax recap. I mean, I don't interact with DOR. If you provide wildly conservative numbers, like you just said half the numbers that you have right now, will DOR be like, OK, cool, have a good day? Or will they also be like, that's a problem? Yes. Are they only concerned when it's too close to the number they might have imagined?
[Bob Dickinson]: Oh, yes. No. Yes, they will. They will. They will call you on that. Okay. Thank you. I don't know how that is. They don't like it. They like me to be right, but be conservative. I mean, that's definitely the way it is. And I would never go in there and knowingly say, I'm just not going to make a lot of money on this one.
[Paul Ruseau]: Thank you. On slide 15, there was a sentence that said, settled through June 30th. I don't know what that meant on that slide.
[Bob Dickinson]: Oh, it's just the city has been, when I first got here, I couldn't even name all the contracts that had not, that we didn't have a new contract. We were still operating under the 2022s or prior contract. The school was that way. It took a long time, as I recall, it took a long time for the school to settle its contract with the teachers. This administration has cleaned all that up so that I think that we're up to date on all of the contracts at this point in time. This year we settled police and Dispatchers and the inspectors and recreation union library. So, all we have those contracts in place. It's just, you know, when I'm looking at budget numbers, obviously, if you haven't given anybody an increase. for three years because the contract hasn't been, you don't have a new contract. I see you nodding, so I think you know what I'm talking about, that your next year's budget has to reflect the fact that you have compounded raises for the last few years. So that's all that I mean. It's good to have that reasonably under control now.
[Paul Ruseau]: Great. Thank you. That's all my questions. Who else? Let's see. Nobody online. It's hot in here.
[Zac Bears]: There's a lot of us in here and a lot of us talking. Well, a lot of us back here. Yeah, yeah.
[Nina Nazarian]: All right, go ahead and say it. A lot of hot air. No, I'm just kidding. Someone had to say it.
[Zac Bears]: It certainly feels like it.
[Nina Nazarian]: Keep it light.
[Zac Bears]: Yeah, I mean, I think the only thing I just... really appreciated Member Reinfeld's question about the values. I think I've seen, as I noted, it's not an easy fiscal condition for municipalities in this moment with federal state aid cuts and the impacts of high inflation on municipal budgets and the fact that the inflation of the things that cities and towns pay for is higher than the breadbasket of things that normal inflation, standard inflation for the everyday person is facing. With all of that said, we did get ahead of this somewhat, maybe like 65% ahead of this with questions seven and eight. But member Reinfeld made a really good point. We've seen communications from a lot of other cities saying this is a very difficult moment budget wise. And I've seen a few communications similar to communications that went out in the last few days in this city hall. I'm saying, hey, we're going to have to make some really hard decisions. We're not going to be able to fund new programs. But for me, you know, the thing that I heard When we said what are the values underlying the city side of the budget was a balanced budget and a balanced budget is a goal not a value. And I think for me really understanding if we're going to have to make certainly if we're going to have to basically forego many of the additional priorities that our city department heads and the city council want to fund. And, you know, if there's even the potential that there will be some cuts below level service, I want to understand better what are the values that are underlying how we're prioritizing what's staying and what's going. And that's something that I think we as a city on the city side, that's a part of the conversation we really haven't been able to get ahead on entirely. I'm hoping that given the notes from our administration that, you know, this is a tough year and we're not expecting the next few years to be a ton better, better understanding and articulating the values that we're using to make priority decisions within the city budget. So that's just my last two cents and I'll stop and we can all be done now. I do want to, before we go, seeing nothing from members of the council and no hands from the school committee, unless member Mastroboni keeps looking at me either wanting to say something or wanting to murder me. So I'm not sure which that is. We will go to public participation if there are members of the public who'd like to speak on the budget presentation we just received from Finance Director Dickinson. You can raise your hand on Zoom or come to the podium in the chambers and you will be recognized for three minutes. All right, seeing no one in the chambers and no hands on Zoom, is there a motion from the City Council? On the motion to adjourn by the City Council, seconded by Councilor Leming, seconded by Councilor Callahan. Mr. Clerk, please call the roll.
[Rich Eliseo]: Councilor Callahan? Councilor Leming? Yes. Councilor Millane? Yes. Councilor Scarpelli?
[Bob Dickinson]: Yes.
[Rich Eliseo]: Councilor Tseng? I heard him. Vice President Lazzaro? Yes. President Bears?
[Zac Bears]: Yes, I move the affirmative, none the negative, the motion passes. Acting Chair Rousseau?
[Paul Ruseau]: Is there a motion to adjourn from the school committee? Is there a second? Member Graham actually got booted out. Member Mastroboni? Yes. Member Olapade? Member Parks? Yes. Member Reinfeld? Yes. Member Ruseau? Yes. And Mayor Lanko-Kern is absent. Is that five? I can't count right now. Five in the affirmative, two in the negative. The motion passes, shall I? This meeting is adjourned.
|
total time: 19.94 minutes total words: 1381 |
total time: 8.55 minutes total words: 799 |
total time: 2.64 minutes total words: 270 |
total time: 0.33 minutes total words: 42 |
|
total time: 2.36 minutes total words: 209 |
total time: 2.13 minutes total words: 212 |
||