Dear citizens of Shirley:
On June 11 the Shirley Annual Town Meeting will vote the town budget for fiscal year 2008. Once again, as it has since the state went into an economic downturn approximately five years ago, town meeting is being held as late as possible in order to find adequate revenue sources to fund the coming year’s budget.
As late as two months ago the town was projecting a deficit approaching $1 million during the Board of Selectmen’s meeting. This number has been whittled down since then, but there still exists a potential revenue shortfall of approximately $150,000. This shortfall has not been unforeseen, based on several factors. The amount of aid coming to the town from the state has been essentially level-funded for the past five years, and is projected to be level-funded in fiscal 2008. Increases in town expenses have been rising at a consistent 4 percent to 6 percent rate each year, but town revenue, restricted primarily by Proposition two and a half, has increased at a roughly 2 percent to 3 percent rate each year.
Shirley enjoys a significant number of services, some of which are not available in other towns. For example, we have 24-hour fire and police coverage, trash pickup and a school system with good class sizes. These services are well managed, but are constantly looking for ways to improve what they currently provide. For example, in fiscal 2008 many town departments proposed increasing the level of services they provide, or requested additional funds to cover expense and capital items necessary to their continued successful operation. Examples include:
* The School Department’s proposal for the expansion and improvement of several of their programs in order to make our schools more competitive with surrounding school districts
* The Fire Department’s request for an overhaul of their ladder truck, with a capital cost of $150,000.
* The library’s request for funding of additional hours of operation.
* The Police Department’s proposal to add a detective to their staff, at an annual cost of approximately $50,000.
While all these requests were well justified, none of these proposals have been recommended for adoption in fiscal year 2008.
When money is not available to fund town operations, then services have to be cut. Since the cost of services provided by the town is primarily based on salaries, cutting the cost of the services means eliminating or reducing positions in those departments where services are cut. If they were asked to cut their staffing, virtually all town departments would argue that they are currently staffed at the leanest levels possible while providing minimum essential services.
For example, the School Department will argue that cutting school teachers will increase class size to an unacceptable level for effective teaching to take place. The Police Department will argue that patrols cannot be maintained at minimally-safe levels if police personnel are cut. The Fire Department will argue that 24-hour coverage cannot be maintained if fire personnel are cut. Arguments would be similar for other town departments as well. These arguments are well-founded and based on management action that has taken place to operate within the lean budgets that the town has experienced for the past five years.
As a citizen of Shirley, you need to be aware that it is essentially impossible for the town to continue to support the current level of services in a fiscally-responsible way given the fact that inflation in costs will continue to outstrip our primary ability to raise revenue because of the restrictions associated with Proposition two and a half. The situation we are facing in Shirley is certainly not unique. On April 1, the Boston Sunday Globe printed an article on the front page discussing this issue. As many as 50 towns in Massachusetts are facing deficits ranging from $166,347 to $5.2 million. The rise in health insurance costs for town employees is cited as one of many factors contributing to these deficits.
Solutions to the revenue problem are not easy. But it is clear to the Finance Committee that the town’s revenue baseline is not adequate to fund operations associated with the current level of town services. This becomes obvious when we consistently have to draw down the town’s stabilization fund and exhaust one-time funding sources to meet operational obligations that have already been significantly reduced.
Hard choices will be needed by you very soon. Do we increase the revenue baseline with a general Proposition two and a half override to fund operations, or do we cut or eliminate one or more of the current town services? The answer becomes even more difficult because, if we assume that financial conditions do not improve, then regardless of the action taken the town will find itself in a similar financial situation sometime in the future.
At town meeting in June, the Finance Committee will fulfill its obligation to the town and provide a recommendation for a balanced budget. As outlined in the preceding description of the financial situation, this will mean that cuts of some sort will have to be recommended in order to balance the budget, unless other sources of funds are identified.
SHIRLEY FINANCE COMMITTEE