AYER — This year’s budget-development process will include having the town’s boards, committees and departments provide draft copies of their work plans for fiscal year 2009 with their budget proposals.
The proposals are due at the town administrator’s office by Jan. 4, 2008.
“The purpose is not to create additional paperwork, but rather to provide additional information to the taxpayers so they can better understand the mission of each department, its scope of work and any new programs planned for fiscal year 2009,” said town administrator Shaun Suhoski.
The town’s revenue picture remains undetermined because the state local-aid environment remains unknown, he said.
“A front-page story in the December 2007 edition of The Beacon, projects a bleak outlook for state finances in fiscal 2009,” he said. “The town should assume no better than level-funding from state aid.”
The Beacon is published by the Massachusetts Municipal Association, a nonprofit, nonpartisan association that provides advocacy, training, publications, research and other services to Massachusetts cities and towns.
With potentially flat state aid, escalating health-insurance premiums and continuing litigation costs, Suhoski has requested that budget proposals take a level-services approach.
Funding the budget busters, health-insurance premiums and legal expenses will likely consume any modest increases in revenue, said Suhoski.
“Assuming a 15 percent increase, we’re looking at health-cost expenses of $420,000 alone,” he said.
Suhoski said he conservatively expects the town’s legal expenses with the lawsuits to reach $350,000 in 2009. He also pointed out that defense against the two civil lawsuits could result in a combined exposure of up to $30 million.
On the brighter side, he pointed out that new growth has increased the town’s tax levy capacity to $171,000.
Each year, the Department of Revenue (DOR) calculates Ayer’s property-tax levy limit under the provisions of Proposition Two and a half. Ayer’s voters then decide how much of the levy limit will be used and collected from taxpayers.
Ayer’s excess capacity has resulted from using less than the full amount available under its state-calculated cap. It may be used this year or later.
With these constraints, Suhoski said he has also requested that department heads submit prioritized and justified lists of new services and increased costs that would exceed a maximum 2 percent increase.
Free cash, which the DOR certified at $862,179 Nov. 1, isn’t necessarily a source of relief, he said.
Ayer’s stabilization fund has a claim over it of $172,436 under the fiscal policy the selectmen adopted earlier this year. The policy allocates 20 percent of free cash to the stabilization fund to help protect the town’s bond rating and safeguard against the outcome of the lawsuits and other extraordinary expenses, said Suhoski.
Free cash also got a bump from a one-time reimbursement from the School Building Assistance Program of $200,000, he added.