03/25/2019 BOARD OF SELECTMEN Agenda Packet

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Town of Maske AdeftL To: Rodney Collins—Town Manager From: Dawn Thayer—Finance Director, Jason Streebel—Director of Assessing, Craig Mayen -Tax Collector/Treasurer CC: Date: O319/2010 Re: Sewer projects We have included the financial scenarios that we were directed to complete if the project is kept in- house with the Town of Mashpee n'housevviththeTmwnofK8oshpee We were asked about the financial effects on the Town of W1aehpee if the Town residents decide to vote yes toundertaking aSewer project for the Town ofyWashpee. The Town operates under proposition 2 1/2 by ubsb* |ovv, Proposition 2 1/2 dictates that the tax levy cannot exceed 2 1/2%from year to year without passage of an override at Town meeting and the ballot box. The Town's tax rate can also not exceed $25 per 1000 for items within the levy and not exempt from proposition 2 1/2. Betterments would not change the amounts needed to be paid bythe Town, it would change the funding source, (Betterment appropriation vetax natej The scenarios listed give the figures for just the construction of eewehng the Town of yWashpee. There is also the additional cost ufadding a department to the Town and other personnel hires that would be needed for administrative functions of biUing, oo||echon, payment of bills and technical experts for mnew sewer department within the Town. As an exemp|e, the amount of recent deportment that was added to the Town. Department of Natural Resources has abudget of$75O.000ayear. This does not include benefits that are paid by the Town. ATmwn department is a recurring expense every year and should be added on top of the construction cost estimates for the amount for the Town to raise. At some point the Sewer fee revenue will offset some of the operational costs but not at the initial onset of the project. Per discussion with the water district it will take some time for revenues to offset with expenses. There are other future financial items to consider that are unknown at this time. 0PEB funding (our OPEB liability is 62 million amofJune 30. 2017). Health Insurance' costs on average continue to rise, u nfunded liabilities of the Barnstable County pension system, (Mashpee's share 34 million, as of June 30. 2016). and wage increases due to the Massachusetts minimum wage increase. Some of these cost drivers were identified byStandard & Poor inour rating profile.