Marblehead Tax Override Strategy Session Held Amid Budget Crisis

MARBLEHEAD, MA — The Marblehead Select Board this week began publicly mulling the parameters of a possible tax override request after Town Administrator Thatcher Kezer told the Board that town departments would need to shave an additional $2 million to $2.25 million from their already-trimmed budget requests to close the gap on the town's looming structural budget deficit.

The Select Board discussed two override proposals — one that would cover the gap and avoid drastic service and personnel cuts for one year, and a second that would create a stabilization fund to provide a buffer in the budget as the town looks to, as Kezer stated during Wednesday night's meeting, "ween us off the free cash wagon."

"The override to plug the structural deficit is kind of low-hanging fruit," Select Board Chair Moses Grader said in framing what became a 45-minute discussion. "It's what we plug to make sure we don't make any cuts for next year. It's really buying us some time. We're not prepared to do a multi-year budget right now. We don't have the systems to be able to do a muti-year in the timeframe that we have (before the May 1 town meeting)."

Kezer told the Board he has been working through staff shortages and outdated information services to determine the exact state of a town budget that had become increasingly reliant on "free cash" — the difference between projected revenues and actual revenues — to supplement the operating budget from year to year.

(Also on Patch: Marblehead Facing $2 Million Budget Gap: Town Administrator)

He said improving those information systems will allow for more accurate real-time accounting and facilitate better budget planning in the future. He also told the Board that the town will have to make a much more concerted effort to produce economic growth — which, generally, comes with commercial development — if it hopes to avoid escalating pressure on property owners to make up the structural budget deficit for years to come.

"Marblehead has been riding along the $300,000 level in new growth," he said. "I'll describe that as anemic."

Kezer reiterated that all town departments will have to meet what he described as an "Article 30 budget" based on known available funding to be presented at the May town meeting. Ensuing town meeting warrant articles would then presumably be the town's general override request to supplement the "Article 30 budget" and avoid those drastic cuts, and potentially separate article warrants to support the stabilization fund and a supplemental school budget.

(Also on Patch: Marblehead Schools Facing 'Catastrophic' Cuts To Meet Town Budget)

Kezer said that while the goal is to progressively reduce reliance on the "free cash" that made up 10 percent of the town's budget funding this year, that process will have to take place over time.

"We're not going to get to zero (use of free cash) in one year," he said. "Because that would kill us."

Grader said there will be at least one public forum next month to present the override proposal to residents for feedback ahead of the town meeting.

Select Board member Erin Noonan said it will be important to be specific and honest with residents about the practical effects of not passing an override this year.

"We have to be able to explain how this actually impacts services," Noonan said.

The town voted down a $3.1 million school supplemental budget last year by nearly a two-to-one margin and has not passed a general tax override since 2005.

The School Committee has already estimated that meeting what Kezer termed the "Article 30" budget will force the district to cut up to 34 positions and corresponding programs. School Committee Chair Sarah Fox said during public comment on Wednesday that, in practical terms, that could mean classes at Brown Elementary School going from 21 or 22 students in a class to 28 or 29 students in a class.

Fox called for the Select Board's override request to be one that "asks for what it costs to run this town" because "anything short of that will just be kicking the can down the road."

(Scott Souza is a Patch field editor covering Beverly, Danvers, Marblehead, Peabody, Salem and Swampscott. He can be reached at Scott.Souza@Patch.com. Twitter: @Scott_Souza.)