Governor Announces School and Local Aid

The Governor announced his budget proposal for next year. It includes a modest increase in Chapter 70 school aid and level funded municipal aid. The State Government is projecting 4% growth in revenues for FY13. An additional $65 million in municipal aid would be contingent on ending this year with a surplus. The Metrowest Daily News has an article with further details. I don't really know the full details like how aid to highways might change. Last year they added money late in the season for highway.

Now to focus on Leicester. I said I would focus on Leicester when budget season came along.

We have the Governor's numbers. It is very likely the Senate and House are going to follow suit. I believe it's safe to build budgets off the Governor's numbers. Town politics not withstanding. Basically what we're looking at is a potential modest increase for schools and level funding for municipal government. We also have the 2.5% increase from local taxes. Chapter 70 increases are direct aid to schools and must go to the schools. They don't get to be funneled to municipal activities. The growth in local taxes is free to be used wherever. My suggestion is that the town uses the tax growth on municipal financing and the Chapter 70 aid goes where it legally must.

So the schools are looking at a modest increase. Based on the teacher's contract we (I say we because I was the School Committee member on the negotiation committee) negotiated last year the salary increase in teacher salaries should be supportable on a modest increase of Chapter 70 aid. I'm not that familiar with salary structure on the municipal side so I don't know if the tax growth is sufficient there. I do know that free cash was used to balance the town budget last year, but we (I was on the School Committee) agreed to a late cut in the school budget to help balance the budget this year. I don't know what the free cash situation is and will have to do some analysis.

My first instinct is that the town should be able to go with a level budget this year. Anyone making pronouncements of fiscal disaster this year is likely playing a game. I'll do some analysis and also keep track of what the town politicians are saying. But from where I sit without doing any real analysis the town is not going over a cliff this year. Those who make dire pronouncement are playing disaster politics. This is manageable.