05/18/2020 BOARD OF SELECTMEN Agenda Packet

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5)� Certified Free Cash(Appendix D-2) 6) Reserve funds by category and type(Appendix D-3) Notes to non-tax revenues: Reductions in revenue started in FY 2009. Estimated receipts fell short by $26,000 due to 9c reductions made by the state in the 'Middle of the fiscal year. This shortage added NO Free Cash to the balance. Due to the budget process and timing, the FY 2009 budget was created a- year in advance and part of that process included.estimating receipts to fund the budget pmpqn 1�Values; FY 2021 property values are based yin'calendar year 2019 sales(values are as of 1/1120)so we do NOT expect to see a decrease in FY 2021 values. The big question Will be values for FY 2022,which will-be based on calendar year 2020 sales(values as of 111/21). This is an unknown at this time and will be determined by the impact COVID-1 9 has on the real estate market for the remainder of 2020. This will be carefully monitored over the next nine months. New growth may be lower than expected if COVID-19 slows down building/construction. This would result in lower available tax levy for budgeting. Again, due to conservative estimates in previous budgeting, we do not anticipate a major impact to FY 2021, but it will need to be carefully monitored for future fiscal years. . Only new growth or lack thereof, would affect the amount of potential maximum levy. Changes in value, in conjunction with budgets will affect tax rates but not levy .cap acity. Currently, new growth is on par with recent fiscal years. FY 2021 Feud et: Conservative revenue estimates give the Town more flexibility when it comes to funding our budget. Concern with reduction in state aid will reduce revenue estimates that we are currently anticipating to fund FY 2021 budget We have not received any information regarding these reductions, however,as this crisis continues,the-more likely it is that towns will see reductions in some form. Concern will be the impact COVID-19 has on the average taxpayer. Loss of taxpayees income will most likely result in financial hardship for many and some potential options to ease the tax burden are: A potential decrease in FY 2021 operating budget requests from departments to reduce their budgets to fund only essential items. NO new programs/initiatives (the school department may also wish to review their upcoming programs/initiatives)and personnel only-as approved by Town Manager. This is extremely important when it comes to full time employees due to additional costs in benefits. (This may also avoid lay-offs in the future.) Ubliz'e additional Free Cash to fund FY 2021 (would be'best if in conjunction with any budget decreases). This is somewhat of a"Catch 22" because the more you use now, the less you have for the future. Notes on Free Cash: Current estimate of usage for town meeting articles results in estimated free cash balance of roughly $3.5 million. *Page 2