NORTH ADAMS, Mass. — The City Council is reviewing a $41 million "placeholder" budget for fiscal 2021 that comes with a host of unknowns. 

 

Mayor Thomas Bernard submitted the document to the council on Tuesday night with the anticipation of having a spending plan in place by the end of the fiscal year on June 30. 

 

"We know that we're seeing state revenue shortfalls, again more questions than answers, and we still don't know what, if anything, we may see in the way of federal relief," he said. "So the budget that you're going to be considering discussing tonight and then through the Finance Committee process is in many ways a placeholder understanding that it will need numerous reviews and amendments by between now and the time that we set the tax rate."

 

North Adams, like municipalities across the state, are working on budgeting in the dark because no one knows how the growing deficit at the state level will affect local and school aid. Bernard shared an article from the State House New Service  reporting that the state's tax collections that been exceeding benchmarks just a few months ago are now $2.25 billion behind. 

 

The budget proposal can be found here.

 

The Legislature is rewriting a fiscal 2021 plan that had been nearly complete in the midst of on of the worst economies on record because of the novel coronavirus pandemic that brought nearly everything to a standstill in March. 

 

In his communique accompanying the budget to the council, Bernard said he was approaching the process with "tremendous concern and trepidation."

 

"It is no secret that our city faces deep and persistent fiscal challenges that demand our attention," he wrote. "Most urgent among these is the need to confront the reality of our levy ceiling with a focus on long-term fiscal sustainability. This alone would have set the stage for a fiscal year 2021 budget process unlike any other."

 

The $41,000,236 proposal is up only $194,698 over this year. It includes increased fixed costs in municipal interest and debt ($159,319), retirement contribution ($128,312) and health insurance ($118,685).

 

Those increases are being offset by reductions totaling $282,683 in Public Services of seasonal workers ($92,820) and one highway position being left vacant ($45,236), Veterans Services ($75,000 based on actual payments), Information Technology ($30,839), auditor ($20,288 for a half-time position), and traffic  and parking ($18,400).

 

State aid is tagged at $19,486,362, property taxes at $18,405,776, and local reciepts at $6,550,056 but the mayor warned that those numbers are unlikely to hold. A one point drop in revenue is comparable to $200,000.

 

The School Department is also working with a level-funded budget but is making preparations for more severe cuts, including adding a fourth option of 11.5 percent in reductions and additional use of school-choice funds that was explained to the School Committee on Monday night. 

 

That budget will also be impacted by whatever decisions are made in Boston on how the school year will look considering the state of the pandemic. Buildings have been closed and learning shifted to remote since March. 

 

"We still have not seen, although we expect it to come fairly soon, the guidance from the Department of Elementary and Secondary Education on what those models and expectations will look like," he said. "So it's a little bit difficult to answer how we would, you know, operationalize a budget around that."

 

Councilor Jason Laforest asked the reasoning for a presenting a level-funded budget when it seemed more than likely that cuts would have to be made. 

 

"Why are we, continuing with a budget that doesn't reflect at least a minimal amount of cuts?" he said, adding if the plan was simply to raise taxes. "I just feel that, given the trend, we're making more work for ourselves down the road and giving us a much more optimistic picture ... are there solid plans in place now for the cuts that you tell us are almost certain to happen?"

 

Bernard said the council had the ability to cut but not raise the budget so it would be difficult to restore anything if the state or federal government was able to offer respite. There is advocacy at the state level, for example, to level fund Chapter 70 education aid, which is a large portion of the city's school budget. 

 

"We can and may need to make cuts to that number, but I would rather not offer those too precipitously if there's a hope that we would not need to go that route," he said. Bernard added that "if I was coming across as optimistic, I missed the boat on my delivery. Because I feel no optimism around, around this scenario. ...

 

"The reason to begin where we're beginning is because we don't know what the depth of those cuts is going to be, and the council has the ability to cut the budget, we don't have the ability to add back if our most dire projections, become, you know, become less dire."

 

The mayor said his financial team has laid out plans, similar to the School Department's, on where reductions could be made dependent on the direction of the state budget. Those would begin to cut into positions and services. 

 

Councilor Benjamin Lamb said he anticipated that the Finance Committee will go line by line over the budget next week but thought it would be helpful to have those scenarios on hand to discuss after watching the School Committee's meetings. Councilor Robert Moulton Jr., who also sits on the School Committee, agreed.

 

 "I thought that that presentation was very realistic at different levels, and I'm wondering if that might be a value to present that in some format, when the committee meetings happen," Lamb said. "I just think that that would be helpful for that dialogue, we're looking at the larger budget."

 

 The mayor said he could bring those scenarios forward and noted that he did not bring the budget forward with an order this year because "it's going to be important that these conversations be highly collaborative with the Finance Committee."

 

 Councilor Marie T. Harpin, chairman of the Finance Committee, said she was scheduling three nights of meetings next week, all at 6 p.m. 

"We will continue, as we have, to track the state budget process and the COVID response efforts in collaboration with the council as we take up this budget," the mayor said. "We will be monitoring the progress of federal stimulus legislation, which may or may not provide relief for cities and towns. We're going to keep monitoring the current year's budget to prepare for end of the year and close out, everything's trending in a good direction right now but we don't want to take anything for granted going into these last months of the year."