Andover Coronavirus: Town Preparing For Major Budget Shortfalls

ANDOVER, MA — Andover is facing significant revenue shortfalls in the current quarter and the next fiscal year, Town Manager Andrew Flanagan told the Select Board at their meeting Tuesday. The town has already implemented a spending freeze for the current quarter, and town officials are working on new budget options for Fiscal Year 2021, which begins July 1.

Exact numbers are not yet known, but Flanagan said he expects a 10 to 15 percent shortfall in the fourth quarter, due to lost revenue from motor vehicle excise taxes and local option taxes on restaurants and hotels. The meals tax and lodging tax earn the town about $1 million each quarter.

The biggest problem for the next fiscal year, Flanagan said, is state aid. Prior to the coronavirus outbreak, the town expected to see increases in state aid.

"If those accounts are level funded, I expect we'll see a revenue shortfall of about $3 million," Flanagan said. "That could go up to as much as $5 million depending on what happens."

Town officials are looking at personnel, capital improvements, and unfunded liabilities as possible areas for savings.

"I don't expect any incremental tax increase as a result of COVID-19," the town manager said.

Flanagan, the Board and Town Moderator Sheila Doherty also discussed options for the town election and town meeting. Flanagan recommended a June 9 town election and a town meeting beginning June 22.

Under legislation passed in response to the outbreak, the town meeting can occur after the end of the fiscal year, June 30 — the town could operate on a month-by-month budget in the interim.

Doherty discussed options for town meetings that allow social distancing, including using a larger space than planned, like the town field house.

The Select Board also approved the town's decision to delay the property tax due date to June 1.

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Christopher Huffaker can be reached at 412-265-8353 or chris.huffaker@patch.com.