Misunderstanding Town Finance Can Lead to Bad Public Policy

Dear Editor:

Mr. Loving's recent letter to the Editor underscores how difficult the world of municipal finance in Massachusetts can be for the lay person to understand. With terms like 'levy limit', 'tax levy ceiling', 'tax levy limit', 'debt exclusion vote', 'cherry sheet', etc. one can become quickly confused by what it all means at the end of the day and how it relates to our property tax. It is important to understand that this year's Annual Town Meeting on April 28 will have no impact on the obligation of the Town to pay the debt service on the new fire station.

The question of whether that debt is excluded from the levy limit is solely beholden to a debt exclusion vote which is scheduled for April 1. If approved, the current debt obligation for the new fire station can be funded above the levy limit which is defined by the limits of Proposition 2 ½. This will free up additional money within the levy limit that can be used to fund the regional school districts assessment. The reason it is necessary to do this before Annual Town Meeting is so voters will know how much money is available to fund the town budget for next year including the schools. To hold a debt exclusion vote on the fire station project after town meeting would require town meeting to be asked to approve a contingency budget and for drastic cuts to be made to school and municipal budgets should the debt exclusion vote fail.

This would be bad public policy and confusing for voters who have a right to expect the budget that is voted at the Annual Town Meeting is in fact the budget for the coming fiscal year.

There is some very helpful information that our Town Clerk has prepared and posted on the town's website that explains municipal finance in Massachusetts and some of the commonly used terms. From the home page go to the 'Special Election Called: April 1, 2014' section and click on 'Town Clerk's Town Election page' link. Once there, click on the 'Town Elections' tab and you will find additional information and links to a fact sheet and the state Dept. of Revenues primer on Proposition 2 ½.

Hopefully, this information will help clarify some of the decisions being asked of voters. It will also provide a further basis for understanding of why both the Finance Committee and the Board of Selectmen support passage of the fire station debt exclusion vote on April 1.

Sincerely,

Peter S. Cunningham

Selectman