Town officials breathed a sigh of relief last week with the announcement that Gov. Charlie Baker and the Massachusetts Legislature have agreed to protect two main sources of aid to towns and schools in fiscal 2021 despite an expected drop in state revenues.
In a July 30 statement, Administration and Finance Secretary Michael Heffernan said that while critical information from the federal government is still needed to prepare a full fiscal year budget for the commonwealth, the Baker administration and the Legislature had committed to provide no less than the amounts provided to towns in fiscal 2020 in aid to local governments and schools. The commitment is needed, he said, so towns and cities could budget for fiscal 2021. A final state budget is not expected before October.
For Harvard, the announcement guarantees that approximately $4 million in state aid will be available this fiscal year, $100,000 more than the amount estimated in the fiscal 2021 budget approved by Spring Town Meeting voters.
The news is a huge relief to town officials. “I had a nice Thursday last week,” Town Administrator Tim Bragan told the Press in a brief phone interview. Knowing there will be no cuts to state aid allows the Select Board to restore some of the $320,000 in spending that was cut this summer after an override failed to pass at Town Election in June—or to exchange those cuts for others that would have had to be made if state aid had collapsed.
For example, the Select Board has already voted to decrease the amount the town contributes to the health plans of DPW employees and police officers. “We already took a vote on it; it doesn’t make sense to go backwards,” said Bragan. Once negotiations have been concluded with the unions that represent each group, the changes will be made retroactive to the start of the fiscal year for an expected annual savings of more than $100,000. A reduction in the amount the town contributes to employee benefits might also prompt town officials to reduce Harvard’s contribution to its OPEB (other post-employment benefits) fund, a savings account that is used to pay the health benefits of municipal retirees, including teachers. The savings from either of these moves could be used to restore some of the $320,000 cut from town and school spending when the override failed.
The Select Board is also considering a request by Police Chief Ed Denmark to allow the hiring of an additional officer in exchange for giving up a new police cruiser and a portion of his department’s overtime budget. That switch would be cost-neutral, but would allow Denmark to fill a position that has been open for two years.
“I’m working on the numbers now,” said Bragan, who planned to present budget options to the Budget Advisory Committee at a special 2 p.m. meeting Thursday, Aug. 8. He said the advisory group will prepare recommendations for review by the Finance Committee and the Select Board, whose job it is to prepare a revised budget for the approval of Fall Town Meeting, scheduled for noon, outdoors, Saturday, Oct. 3.
As for fiscal 2020, which ended June 31, Finance Director Lori Bolasevich and her staff are busy closing its books. Will the town know the amount of free cash available for fiscal 2021 spending in time for Fall Town Meeting? Bragan was noncommittal in his report to the Select Board Tuesday night. The amount has to be certified by the Department of Revenue, he said, and its operations will likely be slowed by its pandemic-inflated workload.
