Somerville Budget

Overview

Mayor Joseph A. Curtatone

June 12, 2017

F

Y

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Budgeting strategically with an eye to

the future

Keeping our schools on a path of

success

Serving Somerville Together

Strengthening core services to

enhance our quality of life

Meeting community needs and

responding to community priorities

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A near level-service budget focused on…

FY2018 Appropriations

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Total Municipal

Appropriation

State

Assessments

Total Operating

Budget

FY18 General Fund Budget

$233M $15.8M $217.2M

4.79% increase over FY2017

Operating Budget

29%

18%

17%

12%

9%

6%

4% 2% 2% 1%

School Department

Public Safety

Pension & Fringe

Public Works

General Government

State Assessments

Debt Service

Culture & Recreation

Other

Overlay Reserve

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Year-over-Year Growth

FY17-FY18

-$500k

$0k

$500k

$1.0M

$1.5M

$2.0M

$2.5M

$3.0M

$3.5M

0

We will NOT be going

to the tax levy limit

FY18 Levy Limit = $143M

$664k under limit

FY2018 Revenue by Source

Property Taxes 61%

State Revenue 21%

Licenses & Permits 6%

Excise Taxes 4%

Other Financing Sources 3% Fines and Forfeits

3%

All Other Revenue Sources

2%

Property Taxes

State Revenue

Licenses and Permits

Excise Taxes

Other Financing Sources

Fines and Forfeits

Fees

PILOT Payments

Miscellaneous Recurring

Penalties and Interest

Changes in FY18: • Hotel/motel tax revenue up 7%

• Meals tax revenue up 3.7%

• PILOT payments up 5.6%

• Permit revenue remains at historic

highs

• No fee increases

• Net State Aid is flat

Planning

for

Greater

Self-

Reliance

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State aid down 39% since 2002

Growing local revenues help

address the loss

$57M

$34.6M

Historical New Growth Review

9 0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Mill

ion

s

*FY18 Projected

Projected New Growth Contributors for FY18: ASQ Block 11 (Retail)

ASQ Block 6 (Mixed Use) ASQ Block 5A (Hotel/Res/Retail)

$2.9M

$192k

$280k

$820k

$1.3M

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

$1.2

$1.4

$1.6

FY12 FY13 FY14 FY15 FY16 FY17 FY18 (Est)

Mill

ion

s

PILOT Payments Increasing

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Other Revenues & Excise Trends

• Excise Trends

• Motor Vehicle: Slight reduction projected for FY18

• Hotel/Motel: Moderate growth

• Meals Tax: Strong growth

$604k

$947k

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

Mill

ion

s

Hotel/Motel Excise Revenue

$1.1M $2.0M

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

Mill

ion

s

Meals Tax Revenue

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FY18 Building Permit

Projection

$2M

$1.3M

$0.5M

$1.8M

$3.9M

$-

$1

$2

$3

$4

$5

$6

$7

$8

$9

$10

Projected Building Permit RevenueFY18

ASQ Block 8

USQ Block D2.3

USQ Block D2.2

Medium Projects>$50k

Small Projects <$50k

(In millions of dollars)

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Board Action Needed on

Parking Meter Receipts

• The City has long used parking meter receipts to reduce the tax levy, which reduces tax growth.

• The Municipal Modernization Act now designates meter receipts as general fund revenue.

• The Board of Aldermen will be asked to vote to accept three statutes, which will collectively allow the existing practice. 13

Photo Flickr Joey Zanotti http://bit.ly/2rhSW3h

FY18 Targeted Investments

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Maintaining Historic Level of

Investment in Our Schools

• Out-of-school programs

• Technology learning

• STEAM offerings

• Middle school sports

• Universal Kindergarten

Readiness and Pre-K,

including Head Start

• FabVille innovative learning

• Special education services 15

Priorities in FY18:

Investing in our Human Capital

• Increase retention to

avoid:

• Loss of productivity

• Loss of continuity &

institutional knowledge

• Replacement costs

• Recruit quality talent

• Support diversity goals

• Contingency planning for anticipated union contract agreements

• Phase II of Municipal Compensation Advisory Board (MCAB) approved salary adjustments

Recruiting and retaining high-quality, diverse staff

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Funding Preventive Maintenance Now

to Save on Costs Later

• Fleet Maintenance increase to invest in and maintain City vehicles

• Buildings and Ground increase to maintain our parks, schools, very old buildings and community spaces

Preventive maintenance pays for itself and more in

improved asset longevity and

decreased repair costs.

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Funding Community Priorities

Field

Maintenance

• To meet intensifying

use and demand,

double the funding for

field maintenance.

Workforce

Development

• Establish long-range

workforce

development plan

• Fund FabVille

fabrication lab

manager

• Expand programs for

culinary

entrepreneurship 18

Expanding Access to

Knowledge and Learning • Two new librarians

will allow the

Libraries to offer

services and

programming that

residents value.

• Increased library

materials funding

will go to

traditional, digital

and innovative

resources.

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Minimal New City Positions

3.125

New Positions

• 2 full-time Librarians

• 1 full-time Payroll

Coordinator

• 0.125 HR Recruiter

(added 5 hours per

week to position)

Budget Neutral

Staff Changes

We’ve also

combined positions

and transitioned

existing positions to

meet our needs with

no budget impact.

Our new tax

ombudsperson is an

example.

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We are also preparing for

major projects

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GLX High School

Citywide & Union Sq.

Infrastructure

Other Capital Projects

We invest in major

projects to meet

SomerVision goals

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And we are on our way,

despite challenges

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SomerVision: Baseline set in 2010, adopted in 2012

Somerville can

meet today’s needs

while investing in

tomorrow

because… 24

Our highest bond rating ever

A growing commercial tax base

Together, we’ve kept our

finances strong and sound

Growing stabilization funds

Addressing long-term liabilities 25

We save strategically

GLX Stabilization Fund: • A means of paying down debt service for

the Green Line Extension. • Receipts of Powder House school to GLX

fund. • Appropriating $1M in free cash in FY18. • Receptacle for developer contributions.

Facility Construction & Renovation Fund: • A means to pay down debt service for the

High School Renovation. • Currently has $2M in Partners building

permit revenue. • Appropriating $1M in free cash in FY18.

Our stabilization funds

are growing, which ultimately helps keep our

borrowing costs down. In this budget, we propose several

significant contributions to our reserves.

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GLX Fund: • Will receive receipts of Powder

House school sale. • $1M free cash appropriation

proposed. • Receptacle for developer

contributions. Facility Construction & Renovation Fund (intended for SHS): • Currently has $2M in Partners

building permit revenue. • $1M free cash appropriation

proposed.

Water and Sewer Stabilization Fund: • $1.4M free cash appropriation

proposed.

And Somerville

continues to

deliver more

with less. 27

Somerville: $2,737

One of the Lowest Spending per

Capita in State (General Fund FY17)

Cambridge: $5,066 Based on 2016 ACS population estimates and published 2017 city budgets.

Boston: $3,415

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Highest Residential

Exemption in Commonwealth

Through the support of the Board of Aldermen, our

resident property owners can save $2,747 in FY17.

That’s $229 per month.

35%

We’re Keeping Our Residential

Tax Rate Lower

6.49

11.67

16.58

0

2

4

6

8

10

12

14

16

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Residential Tax Rate FY17 Our rate is lower than most, plus most don’t have

residential exemptions

Source: Dept of Revenue 2017 Community Comparison Spreadsheet

A Determined Community

The Community

City Government

Thank you

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