By: DJ Deeb – July, 2016
June proved to be a volatile month for both the City of Methuen budget and the Methuen Public Schools budget. Even though Mayor Steve Zanni proposed increasing the city budget by 6.25%, he initially proposed level-funding the schools. Faced with nearly $3 Million in new Federal Special Education mandates, level-funding would have meant over 54 layoffs of school employees plus the institution of user fees for students who participate in sports and other extracurricular activities. The Methuen School Committee proposed a 3% increase over last year’s budget in order to level-fund current services. More than 300 parents, teachers, students, and community members turned out in support of the school committee’s proposed budget by attending school committee and city council budget meetings during the month of June. I am grateful for this show of support and for the approval of the school budget by the city council.
Last year, the city council approved an operating budget for the city of $70,928,966, without education. The mayor was proposing a Fiscal Year 2017 Budget without education of $75,360,525. This was a 6.25% increase over last year’s budget.
The schools were asking for just 3% to help cover the new Federal and State Special Education mandates of $3 Million. We have no control over these mandates. If we do not follow them, we open up our school district to the possibility of receivership by the state and the city to millions of dollars in fines for non-compliance; this could greatly increase the property tax burden on homeowners and would have other disastrous consequences to our city. Even with this funding, our schools still have to cut over $1 Million from the school operating budget.
The school committee and superintendent are willing to do this in the spirit of fiscal responsibility and cooperation in order to ensure that all of our city services and public safety are fully funded. Let’s not forget that our property values are largely determined by the conditions of our schools. We want Methuen to continue to be a community that young families desire to live in and move into.
In considering the Methuen school’s budget, the following facts taken from the Department of Elementary and Secondary Education regarding Methuen schools should be noted:
• Bottom 15% of districts for total per pupil expenditure
• Bottom 9% of districts for per pupil expenditure for administration
• Bottom 38% of districts for per pupil expenditure for guidance and school psychologists
• Bottom 34% of districts for per pupil expenditure for classroom teachers and specialist teachers
• Bottom 5% for per pupil expenditure for instructional materials, equipment, and technology
• Bottom 20% for per pupil expenditure for operations and maintenance
• Bottom 23% for per pupil expenditure for other teaching services
I understand the difficult choices that our city council members were faced with in approving a budget for this coming fiscal year and I appreciate the support that Councilors Lynn Vidler, Jen Kannan, Tom Ciulla, Lisa Ferry, and Jim Jajuga have given to our school system. I also appreciate the fact that Councilors Ron Marsan, George Kazanjian, and Jamie Atkinson were reluctant to approve taking $2.5 Million out of the City Stabilization Fund to fund the school budget and their opposition to the mayor’s 6.25% increase in the Operational City Budget. I share their concern that depleting the Stabilization Fund would have been fiscally irresponsible for our city. Luckily, an additional $466,000 in Medicare reimbursements will prevent the depletion of the Stabilization Fund along with an anticipated addition of $810,000 more into the Stabilization Account in fiscal year 2017. Having said this, the city really needs to address its spending problem in order to avoid a future fiscal crisis.
A 6.25% n on-Educational Operational Budget increase is too much. The current levels of spending in our city are not sustainable in the future. I proposed nearly $1.7 Million in cuts to the mayor and city council for the FY 2017 budget following the mayor’s asking for suggestions. These were intended to be a starting point for further discussion and would have minimized the property tax increases and prevented most of the reduction in the Stabilization Fund. Rather than give any of these cuts in increases consideration, the mayor chose to pit city departments against one another. This is truly unfortunate. We should all be working together to move our city forward. A 3% increase in the overall city budget would have been fair and responsible. A 3% increase in the city budget (instead of the 6.25% increase that was approved) would have ensured that all of our City Departments (Schools, Police, Fire, DPW, etc.) were adequately funded, collective bargaining obligations met, and the Stabilization Fund left intact in order to maintain our bond rating and cover emergency costs.
Methuen has a spending problem, not a revenue problem. The city needs to learn to live within its means. After reviewing the FY 2016 Appropriations Budget and the mayor’s FY 2017 Proposed Budget, I offered a list below to consider when making cuts. Again, these proposed cuts in increases were intended to be a starting point for discussions:
• Human Resources $9,810 (Increase of 2% instead of 6%)
• Treasurer $46,257 (Level fund instead of 9% increase)
• Ec. & Comm. Development $160,108 (Increase of 2% instead of 12%)
• Assessment $13,150 (Increase of 2% instead of 5.35%)
• DPW $191,058 (Increase 3% instead of 6.5%)
• Police Services $715,648 (Increase of 3% instead of 9%)
• Fire Prevention $560,705 (Increase of 3% instead of 9%)
• Reduce DPW Non-Snow Overtime by 30% $72,000 out of $240,000
Our city employees across departments do a commendable job, but the City of Methuen’s budget is not sustainable in the long-term. If current spending trends in the city continue, it is very likely that police officers, firefighters, city workers, and school employees will be laid off next year or the following year if the city does not receive additional State Aid . None of us want to see this happen. I urge members of the city council to begin planning for the future financial stability of our city. I am not looking to change any of the benefits that have been promised to current workers and retirees, but our current level of benefits needs to be reigned in. This means that retiree health insurance contributions for new city hires needs to be increased. Also, sick-time buy-back and longevity benefits need to be reduced and phased out in future contracts for new hires, while maintaining our promises to existing employees. When the city takes the lead on these issues, the school department will be in a better position to negotiate these items in future contracts.
Many people in our city do not make the connection between the overall city budget and the school department because they are unaware of the existence of chargebacks. Years ago, the City of Methuen negotiated an agreement with the Methuen School Committee to implement a system of Chargebacks to the school department. In other words, the Methuen School Department pays a percentage of the budget for other city departments each year. So when the budget is increased for other city departments, the school department is billed additional monies by the city to cover those costs. It is not unusual for a city or town to have chargebacks, but at its June 13, 2016 Meeting, members of the Methuen School Committee voted 6-1 (the mayor voted against) to request an independent state audit of chargebacks to ensure that the school department is not being charged for city services that it does not utilize.
I understand that we have many senior citizens in our community living on a fixed income. Those relying on Social Security benefits have not seen a cost of living increase in 2 years. We need to be mindful of this when setting the property tax rate. City Auditor Tom Kelly stated that we can expect the average homeowner’s tax bill to increase by about $200 this coming year. Property tax rates have been spiraling out of control. In 2013, the average homeowner saw an increase of 3%. In 2014, with reassessments, that rate increased nearly 9%. Finally, in 2015, we saw an average increase of 6%. It is true that fixed costs in the city, including retiree health benefits, increase each year. I call upon the mayor and the city council to address the city’s long-term budget. The mayor’s suggestion of a Proposition 2 ½ override is not the answer. The city needs to reign in spending.
D.J. Deeb is a Methuen resident and member of the Methuen School Committee. Deeb is an Adjunct Professor of History/Government at Bunker Hill Community College and an Adjunct Political Science Instructor at the University of Massachusetts Lowell. He teaches Social Studies full-time at Reading Memorial High School. He is the author of Israel, Palestine, and the Quest for Middle East Peace (University Press, 2013) and The Collapse of Middle East Peace (IUniverse, 2003).