Oak Bluffs selectmen will recommend a $24.6 million dollar operating budget to town meeting voters in April, representing an increase of 1.8 percent over the previous year.
Under the fiscal year 2014 spending plan, nearly every town employee will get a raise, the town will add a full-time position for health and building regulation enforcement, the fire chief will get new responsibilities and a substantial raise, and a limited number of lifeguards will return to summer patrol on town beaches.
“We really rode hard on this budget,” said Walter Vail, vice-chairman of the board of selectmen. “It’s pretty skinny. I think that ought to sit well with the community. We have no intentions at this stage for any Proposition 2.5 overrides. I’m not sure we could pass them if we had to. I think what that says is we’re managing the budget.”
Town administrator Robert Whritenour said the “very lean” budget reflects a strategic plan compiled through a series of fall workshops that prioritized spending.
“The budget preserves current services levels, and also makes modest initiatives to improve services in key areas as recommended by the board of selectmen in the town’s strategic plan,” Mr. Whritenour wrote in support of the budget he submitted to selectmen. “Because the plan’s recommendations are so comprehensive, funds are obviously not available to implement every project in the first year. Rather than over-extending ourselves, the budget attempts to allocate our limited town resources toward taking the first meaningful steps toward implementing priority projects. The number one priority of the strategic plan remains the stabilization and improvement of our financial condition.”
The town remains strapped for cash, and limited in the amount of funds it can raise through property taxes. The Massachusetts Department of Revenue (DOR) has not yet certified the town’s free cash account, but Mr. Whritenour expects the figure to be in the range of negative $400,000. It would be the fourth consecutive year the town has run a deficit, but that figure would represent substantial improvement over the previous year, when DOR certified free cash at a deficit of $888,046.
Free cash, roughly equivalent to a checking account in family finances, is the amount of money the town has left over after fulfilling all of its obligations for the fiscal year.
By comparison, Edgartown had $1.8 million, and Tisbury had $1.4 million in free cash available at the beginning of the current fiscal year.
Selectmen have lauded Mr. Whritenour for reducing the town’s deficit, and putting the town back on a path to financial stability.
“During our financial rebuilding process, the budget must not only be sustainable, it must also generate positive financial performance by collecting more that we spend in order to eliminate all deficits and begin the rebuilding process for our reserves,” Mr. Whritenour wrote in his message to selectmen. Mr. Whritenour said he is hopeful the town can erase its entire free cash deficit by the end of the current fiscal year.
The budget includes contractual raises for all police officers and teachers, and a 3 percent step raise for all other town employees. In a phone interview, Mr. Whritenour said most town employees got no step raises or cost of living adjustments (COLA) in the two previous years, and they will get no cost of living adjustment this year. Instead, every employee covered by the town’s wage and classification scale will advance one step.
“You can’t have a permanent moratorium,” Mr. Whritenour said. “What you need to do is slow down the growth in overall spending. Our bottom line is we need to be frugal, but we need to protect the service levels of the town. We’re trying to tread that fine line.”
The budget also calls for a salary hike for the position of fire chief, from $12,000 to $32,000. The town also plans to increase the stipends paid to call firefighters. “We’re looking at increasing the chief’s presence in the department, to manage the fire department and institute a fire prevention program,” Mr. Whritenour said. “What we’re trying to do with the stipends is keep them in line with what else is going on on the Island. We don’t want a major disparity.”
Voters will be asked to approve funding for a full-time enforcement officer, who will share duties between the health department and the building department.
“The area of code enforcement is an area we recognize is one of our Achilles heels,” Mr. Whritenour said. “In order to keep on top of our building code and health regulations, we need some additional help.”
The budget also restores a number of part-time summer positions in the Parks and Recreation department, including funds for a limited number of lifeguards at town beaches. Facing a severe financial crunch in 2009, the town curtailed the lifeguard program. That decision generated many complaints from summer residents and visitors. If voters approve, the budget will also restore some part-time positions for the summer basketball and tennis instructors.
Debt downMr. Whritenour said that rapidly declining debt service is one of the reasons the rate of budget growth is low. Bonds that financed construction of the Oak Bluffs School and several wastewater projects are nearing the end of their term, and the amount of interest and principal the town has to pay is declining.
The proposed budget includes $2,024,162 to pay off the principal and interest on bonds that financed various public projects. The town’s debt service next year will be $240,996 less than the current year.
Since voters decided to exclude the debt from Proposition 2.5 tax limits, the reduction in debt results directly in a reduction of property taxes. Mr. Whritenour said the lower debt service would result in a 10-cent cut in the tax rate, or about $50 for the average household.
That savings will be consumed, however, by the increase in the overall budget. Town officials expect a slight increase in tax bills in the next fiscal year.
Mr. Whritenour said that large increases in assessments for regional services proved to be a challenge.
The budget reflects a 4.8 percent increase in the cost of educating Oak Bluffs students at the Martha’s Vineyard Regional High School.
He said the town’s share of the Martha’s Vineyard Commission’s operating cost increased by 10 percent. He also cited an increase in county programs.
“This year alone, some of these programs, such as health care access and pest control, have either doubled or nearly doubled in cost,” Mr. Whritenour wrote in his message to selectmen. “It will not be sustainable to continue to fund the regional programs at the level of increase that we are currently seeing, and efforts must be made to review this at the regional level, most notably with the county advisory board.”