Marblehead Select Board members will now place one general override, not two, before Town Meeting in May, and Town Administrator Thatcher Kezer put an estimated $2.5 million price tag on it.
“I don’t want anybody to get misguided by the raw numbers,” said Kezer during the Select Board meeting on Wednesday night. “There will be tweaking.”
As they assembled the fiscal year 2024 budget, Marblehead Finance Director Aleesha Nunley-Benjamin and Kezer arrived at the $2.5 million number by subtracting projected revenues of $94.5 million under a no-override budget from projected expenditures of $97 million under a level-services budget. Departments made sacrifices to help address the structural deficit.
“You’ll see departments that have taken a good amount of cuts,” Kezer told the Finance Committee on Monday, March 21, adding that the target was a 4% reduction per department. “There are departments that were significantly reduced to meet the target number. Other departments — there are no cuts.”
The override request targets the projected structural deficit stemming from the town’s reliance on free cash to balance its annual budget. In FY 2024, the town estimates free cash to come in at $8 million, a $2.6 million decrease over the $10.6 million used to balance the FY 2023 budget.
As a general override of Proposition 2 1/2, the new taxes would become a permanent part of the town’s revenue base, helping the town avoid similar shortfalls in future years.
The proposed override also includes funding for Marblehead Public Schools, allocating $1.388 million to town and $1.134 million to the school district.
“If an override went on the ballot and it had passed today, that would go into the town and the schools,” Kezer said. “My intent is to come through with some final numbers, and like I said, there’ll be some changes, but they’re relatively small.”
The schools’ allocation may seem smaller, but only on the surface, Kezer suggested.
“Be aware that a large chunk of the schools’ costs show up on the town side,” Kezer said. “That is the raw breakout.”
The Select Board cemented the one-override decision by signing off on “a statement of intent,” outlining how a general override would be used, if Marblehead voters approve it.
Members abandoned their plans for a second override to put money into the town’s stabilization fund, at least for now. Town Meeting has already deposited $500,000 in the fund over the past two years. Municipalities set up stabilization funds to squirrel away money and build a financial cushion.
With a two-thirds vote of Town Meeting, the town can dip into the reserve fund during economic uncertainty, revenue shortfalls and unexpected emergencies. Reserve funds help keep what one might consider to be Marblehead’s credit score in good shape, translating to cost savings for taxpayers due to lower interest rates when the town borrows money.
“Our intent is to defer on proposing a second override to accelerate funding of our stabilization fund so that we don’t overburden the taxpayers this year by addressing the stabilization fund and to allow our newly installed finance team, utilizing our new information systems, time to develop a longer-term strategy to address our financial challenges,” said Select Board Chair Moses Grader, reading from the statement of intent. “By taking this slower and more prudent approach, we believe we can take the time to address our challenges and streamline the override process this year.”
Meanwhile, Marblehead Finance Committee members have entered the final stages of their budgetary review, analysis and approval process before the Town Meeting in May. Wednesday’s decision allows members to move forward with that work.
Finance Committee Chair Alec Goolsby said his committee would convene two public hearings to review and analyze each department’s budget before they hold their annual warrant hearing. All will be held in the Select Board Room of Abbot Hall, 188 Washington St. The public hearings are scheduled as follows:
- Monday, March 27: Cemetery, Assessor, Health and Waste, Town Clerk/Election and Schools.
- Monday, April 3: Retirement, Water and Sewer, Rec and Park, Library, and Select Board.
- Monday, April 10: Warrant hearing.
