The Advisory Committee's Budget Letter June 2009 Norfolk's proposed FY2010 budget was completed on June 12. The delay in preparing the budget reflects the substantial uncertainties at the state budget level. Unfortunately, those uncertainties are not completely resolved at this time and probably will not be until after July 1st. Amidst this uncertainty, Norfolk has adopted a relatively conservative basis for its budget, with state aid assumed to be about $90,000 above the level indicated in the latest Senate budget. However, it is important to recognize that the state's final budget could further reduce aid. You will be asked to vote on many individual line items in the proposed budget. Rather than comment on each line item, we focus on the budget summary and budget impact summary shown here. The budget spending summary shows the proposed spending on major categories in our budget. The categories consolidate related line items in the detailed budget and have been rounded. It also shows the change, in dollar terms, from spending in last year's budget. Norfolk FY 2010 Budget - Spending Summary (totals may not add due to rounding) | |Proposed Spending |Change from FY | | | |2009 | |Education | | | | Elementary |$9,800,000 |$0 | | KP |$6,860,000 |$490,000 | | Tri-County |$380,000 |-$20,000 | | | | | |Public Safety | | | | Fire |$1,200,000 |$0 | | Police |$1,720,000 |$0 | | Dispatch, Building, & |$440,000 |-$10,000 | |Other | | | | | | | |Public Works | | | | Public Works |$1,610,000 |-$10,000 | | Road Program* |$1 |$0 | | | | | |Library, Recreation |$520,000 |-$30,000 | | | | | |Government & Human Services |$1,960,000 |-$90,000 | | | | | |"Fixed" Costs | | | | Debt Service (excl. KP) |$1,120,000 |-$330,000 | | Benefits & Insurance** |$3,330,000 |$270,000 | | | | | |Capital |$0 |$0 | | | | | |Total |$28,940,000 |$260,000 | *) Excluding chapter 90 state spending **) Including elementary school insurance The budget impact summary describes at a high level the impact of the proposed FY2010 spending relative to service and staffing levels in FY2009. Norfolk FY 2010 Budget - Impact Summary |Education | | | Elementary |Reductions in teaching staff leading to class size | | |increases from between 19 and 20 to approximately 22 | | |students per class. | | KP |Despite Norfolk's increased contribution, severe | | |reductions in teaching staff, classroom time, and reduced| | |graduation requirements are projected as a result of | | |reduced state aid and no corresponding increases in | | |contributions from Wrentham or Plainville. | | | | |Public Safety | | | Fire |Reduced "callback" and leave coverage meaning increased | | |reliance on other towns in the event of multiple | | |emergencies and fewer firemen available for duty. | | Police |Reduction in officer presence on day and afternoon shifts| | |due to cuts in leave (i.e. holiday, sick, personal, | | |funeral, specialized duties, and vacation) coverage. | | | | |Public Works | | | Road Program |Miles of town roads categorized as "Poor" increase from | | |25 to 28 miles | | General DPW |Loss of 2 positions (10% reduction); focused narrowed to | | |public safety & liability issues. | | | | |General Government &|Loss of 4 positions (20% staff reduction) | |Human Services | | | | | |Library, Senior |Elimination of Sunday Library hours except for Jan thru | |Center |March. | | | | |Capital |Delayed replacement of emergency equipment, outdated | | |computers, and police cruisers. | Perhaps the most noteworthy element of the FY2010 budget proposal is the $490,000 increase in spending for the KP middle and high schools. The primary driver of this increase is the state's assessment that Norfolk should spend more on middle and high school education while Wrentham and Plainville continue to pay about the same as last year. At the time KP first proposed its budget, it was expected that the increase in Norfolk's spending, plus level state aid payments, would support a level funded spending program (i.e. spending flat at FY 2009 levels). However, this translated into cuts of about $900,000 relative to the level of spending necessary to maintain KP's current programs. Subsequent reductions in state aid to KP total about $800,000, thus creating a $1.7 million shortfall relative to a level services budget. Paradoxically, even with Norfolk's substantial spending increase, FY2010 will see severe reductions in educational services at KP. The service cuts will be detailed at the town meeting. Norfolk's elementary school spending is held flat on a level funded basis, but cuts in state aid will not have so severe an impact at the elementary level. The primary impact of the level funded spending proposed here will be an increase by two to three students in average class size (from a current average of about 19 students per class). The Advisory Committee believes that the disparities in funding and services between our local elementary and regional middle and high school budgets are a very significant problem. Norfolk's local and regional educational spending priorities are difficult to harmonize under current circumstances - it seems likely that spending priorities would be more efficiently organized in a consolidated educational system. These are tough problems but ones that must be addressed or our middle and high school educational programs could be decimated. Norfolk's increased educational spending is accompanied in the proposed budget with cuts in spending and services in other areas. The largest cuts are in general government and human services, which will, in total, lose four positions. To some extent, those losses are driven by lower demands as new development has slowed. But more importantly, the 20% staffing cut will lead to reductions in service in all aspects of general government. A further 10% cut in DPW staffing is projected in the budget, which will further constrain the town's spending on anything other than immediate public safety and liability problems as they pertain to the town's infrastructure. Furthermore, there is no increase in road maintenance program spending - that budget remains zeroed out. This leaves only state chapter 90 funds for road maintenance. The mileage of roads categorized in "Poor" condition is likely to increase by about 10% as a result. Note that road program spending will increase next year (i.e. fiscal 2011) if the town chooses to fund the road maintenance override called for in the warrant - the override will not have an impact on this year's spending. Spending on public safety is cut modestly in the proposed budget. That modest decrease allows the town to maintain essential services but only by cutting back on some spending to cover absences for sick leave, vacation, and other matters. This means that there will be times when the town's fire and police staff on duty will fall below recommended safe practice levels. More spending cuts are planned at the library. The cuts there will be managed by closing the library on Sunday, except for the peak January - March period. The town expects to spend nearly $4.5 million on "fixed" expenses for its benefits and insurance as well as debt service. The good news in these accounts is that there is a reduction in our debt service not excluded from our proposition 2 1/2 cap in FY2010. The bad news is that the reduction in spending there is largely offset by an increase in spending for benefits and insurance. Although no capital spending is included in this budget, we do anticipate providing at least $100,000 in that account in a supplemental budget to be proposed in the fall at a special town meeting. Urgent requirements for safety equipment, police cruisers, and computer equipment must be met, and we are modestly optimistic that some additional state funding will be available in the fall to help meet that need. Overall spending increases by $260,000 in the proposed budget relative to last year's spending. Once capital spending is accounted for, the increase will amount to at least $360,000. At a time of declining state aid and reduced town revenue growth, that increased spending can only be met by the use of non-recurring revenues. In fact, about $800,000 of non-recurring cash is used to meet the spending requirements in this year's budget. About half that comes from the settlement received by the town in a legal matter, free cash, cash from the ambulance receipts account, and property sales account for the remainder. The continued heavy reliance on non-recurring cash, even after serious cuts in services, indicates to us that Norfolk's spending ambitions and funding capacity are seriously out of line. We believe that a substantial operating override will be necessary next year to close the gap. The severe spending cuts otherwise necessary would compromise Norfolk's quality of life and property values. Norfolknet.com your community, on-line