By Max Bowenemail@example.com
In anticipation of future budget hurdles, the Town Council unanimously approved appropriations for the Overlay Account and Stabilization Fund.
Town Manager Michael Borg said that the funds come from an unexpected increase in state aid, primarily Chapter 70, which goes to the schools. No budgets were reduced as a result of these appropriations. The state budget was recently approved by the House and Senate, and is awaiting Gov. Charlie Baker’s signature. Borg said he doesn’t anticipate any changes.
Borg added that in order to achieve a balanced budget, the state utilized $1.7 billion from its own Stabilization Fund, and there may be shortfalls in State Aid in the near future.
“To best support the town I recommend the money be transferred,” said Borg at a virtual Special Town Council meeting held on Dec. 8.
The appropriations come in two parts. The first is approximately $414,000 to the Overlay Account, which provides a backup source of money that covers unexpected shortfalls in property tax revenue. With the Emerald Square Mall now in receivership and slated to be sold within the next year, Borg said there is concern over its valuation for property taxes.
The second is a $2.2 million appropriation for the Stabilization Fund, bringing the total to $7.3 million. Borg said there are a number of capital projects planned. Projects that are now underway include the replacement of the Community School roof and the track and bleachers at the high school. He said that putting the money into this fund allows for easier access in the event of an emergency situation. A two-thirds vote from the Town Council would be required.
“I believe that moving these funds would provide the best option and position the town to weather any financial upheaval in the coming days,” said Borg.
There was little discussion from the council before the vote was taken, but those that did speak expressed support. Council Vice-President and Finance Subcommittee Chair Justin Pare said that moving the money to the Stabilization Funds allows for action, in the event that changes to budget line items need to be made. Councilor Michael Lennox said this proposal puts the town in a strong financial position.
“We’re really in a good position right now to make some strategic decisions for the town,” said Pare.