11/17/2016 FINANCE COMMITTEE Minutes

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4 Finance Committee Minutes November 17, 2016 APPOINTMENTS& HEARINGS Town Manager—5, 10,20 Year Projected Budget Presentation: (continued) The Finance Director also indicated that$1.5 in free cash is used historically to offset the operating budget annually. As a result of conservative budgeting,the current balance is approximately$6.6 million. The Finance Committee asked if this could be a one year tap in the budget to avoid a costly override in 2022. In fiscal year 2018 tate total general government revenue projection is$57,124,093. With regards to wastewater/cleanwater there are different scenarios to consider regarding financing,interest rates, forgiveness rates,zero interest loans, adaptive management approaches and other implementation options. Budget assumptions in FYI through FY23 under both educational and non-educations departments reflect a 2.5%increase. In FY24 to FY27 the figure is decreased in the revenue analysis to 1.5%. Fixed costs increase by 2.5%with the exception of LUINA and health insurance which are increased by i 0°fa. A new budget item for FYI is the Department of Natural Resources which is represented by a 2.5%increase through FY23. The Cape Cod Technical School assessment includes an additional $300,000 budget for the start of the renovation/construction project. However,the true cost is unknown to date. Debt associated to the Quashnet School window and door replacement project is also a cost to be determined and is expected to be bonded with the first bond payment to be assumed in FY21. Although the CIP Committee has not convened,there are capital improvement programs projected,road bonds,and building improvements in the revenue stream. Therefore a$3.8 million bond is anticipated with bond payments to begin in fiscal year 2022. With tangible figures,the actual figures would be adjusted. It was noted the budget may be offset with the overlay surplus in FY21. The overlay is generally held by the Assessors to reimburse the Town for any exemptions or abatements. It has remained steady at approximately $200,000. If these monies are not expended with a vote of Town Meeting,the funding can be transferred for use as a funding source. As this matter was discussed it was noted that an override would bring the Town to 2027,and maintain an estimated$1.8 million in the tax levy. Jason Streebel,Director of Assessing indicated the tax rate valuation trend flows in a ten year cycle with peaks and valleys. Mr. Streebel estimates that real estate will peak within the next two years,and then valley in 2022. Generally,when valuations decrease, the tax rate increases and in 2027,it is projected the tax rate may be well over$20 per$1,000 valuation.