Understanding the Override using a Simple Analogy

As the vote for the override is nearing, I’ve tried to get a handle on what it actually is. And to be honest, it’s not obvious. Before knowing anything, I was of the mindset that the City’s financial crunch was probably a consequence of poor financial management. But, after digging into it, I have come to a different understanding, and I have realized that it is not an easy thing to get one’s head around. So, in an effort to make the override more clear for others who may be having the same trouble I had, I came up with this simple analogy that captures the essence of the override situation:

Imagine you run a second-hand clothing store. Nice quality, lightly-used – that sort of thing. You need $100,000 in revenue to run your shop each year. And you’ve had an even balance sheet for several years now. Recently, you’ve been be able to find some really incredible items and traffic to the store is up. Over the course of the past year, store sales have really jumped; but you’ve had to spend more on handling the new demand. Added displays, converting a storage space to more display space, hiring 2 additional staff, launching an online store, and so on. Expenses for these new things have brought your annual revenue need up to $150,000. But the increase in revenue from the uptick in sales (and extra $70,000) will more than accommodate the extra expense … or will it? Apparently, there is a rule in town that limits the increase in revenue you can bring in from one year to the next! You can only take in 10% more revenue than the year before. What!? How can this be? People are spending that money in your store – it’s your revenue. And, heck, you need it to run the store now that it has grown. But, because of this rule, you can only take in 110,000 this coming year. That is $60,000 too little! And what that means, is that an item that you normally sell for $7, you have to sell for $1. This will ensure that instead of the $70,000 you are due, you only bring in $10,000, abiding by the rule. Great for your customers, a disaster for you.

And that is how I understand the override.

Melrose is an amazing city. Take a moment to think about it. Not too big, not too small. An amazing downtown with several fun events throughout the year. Sports complexes for our students and for the public. Access to routes 93 and 1. MBTA bus service, and easy access to the Orange Line. Three commuter rail stops. Lovely homes, old and new. Comprehensive trash and recycling services. A strong, vibrant public library and the culturally and historically significant Memorial Hall. Strong schools and safe neighborhoods. Green spaces, a golf course, an idyllic pond, and a stone’s throw from the Middlesex Fells. And great, salt-of-the-earth people. The list can go on. Where else in Massachusetts, or arguably anywhere, can you find a place like this? It’s no wonder people are flocking here. But this influx requires the city to do more, serve more, provide more. Normally, it should work out fine. The desirability of Melrose has driven property values up, raising the City’s tax base, enabling the City to bring in the additional revenue it needs to meet these growing demands. But Prop 2 ½ limits what the City can bring in, just like the store in the anecdote above. So, the City is hamstrung by this limit on revenue – revenue that it technically has, but can’t collect. And, just like the customers at the store who are getting amazing deals, buying heavily discounted items and ultimately putting the store’s viability at risk, we, as taxpayers, are getting a great deal too. And I while I love a great deal as much as the next person, there are cases where I feel I should pay for what something is worth. And Melrose is worth a lot to me. I hope it is to you too.