ORDER-2018-183 : City of Melrose Operating Budget for Fiscal Year 2019 in the amount of $79,399,945.73 (Seventy-Nine Million, Three Hundred Ninety-Nine Thousand, Nine Hundred Forty-Five Dollars and Seventy-Three Cents).

Transcript (~17 min @ 3:50)

Speakers identified by voice; unnamed voices are numbered within this recording. Auto-caption text — verify against the video.

▶ 2:45 Jennifer L. Lemmerman: have on our agenda which is order 2018-183 the city of melrose operating budget for fiscal year 2019 in the amount of 79 million three hundred ninety nine thousand nine hundred forty five dollars and seventy three cents we do have uh that two budget hearings on our agenda this evening i will note um before we dive into those that we do have a full board meeting this evening as well it's scheduled to start at 7 45 anticipate we will still be deliberating in the appropriations committee at that point we of course our rules allow for a half hour cushion to start a meeting from its scheduled time however we do have two public hearings on the agenda this evening unrelated to this they are national grid items at 8 and 8 15 so we will have to recess the Appropriations Committee by about 10 of in order to have time to start the full board meeting and get to those public hearings and we will return if need be after after that the first department we have on our agenda this evening is 399 vocational school and Essex Aggie it's in the amount of eight hundred thousand ninety four dollars and we have Jay Pecone with us this evening to speak on

▶ 4:09 Peter D. Mortimer: that do we have a motion to suspend the rules madam chair second motion to

▶ 4:11 Jennifer L. Lemmerman: suspend the rules by Alderman Mortimer seconded by Alderman Poicelle all in favor we'd like to invite you up please good evening good evening madam chairman

▶ 4:41 Speaker 1: thank you for being here good evening my name is Henry Hooten and I'm the Melrose elected official at the vocational school I represent city of Melrose on the school committee and any questions I know we're here for the budget I wanted discuss the budget and any questions pertaining to the budget we'll answer before I begin I'd like to turn it over and introduce you to mr. David DeBarry our superintendent on my next right next to me and James for calling the business

▶ 5:16 Speaker 1: manager as well I wish to explain somewhat very quickly what is going on at the vocational school first of all you're aware of the fact that the vocational school is built right behind wakefield school so that's what we know second it was built in 1968 which means Thorp a lot of infrastructure that's wearing down and everything else however that's another issue that these gentlemen will talk about there are two factors that we have have to deal with one is the minimum contribution which is given to us by the state we have no control over that and the other is the total assessment that is the minimum minimum contribution plus any budgetary things that we have to offer this year the budget minimum contribution went down is now six hundred thousand dollars in for four hundred and fourteen dollars is a decrease of ninety eight thousand six hundred and twelve dollars on the total assessment which is what we all we have to end up paying last year it was seven hundred ninety two thousand dollars approximately this year it's six hundred in eighty four thousand dollars approximately which is a decrease of about one hundred and eight thousand dollars this thing this part of the budget includes transportation and other factors involved in the budget so you can see that there are two things that from a financial standpoint Melrose has decreased this aspect of the budget primarily because of the fact that we only have we have eight less children going to the vocational school than we had last year other towns have their population has really increased up at the vocational school and they are assuming larger assessments

▶ 7:26 Speaker 1: we have roughly 293 students that are going to be graduating in about two weeks up there

▶ 7:37 Speaker 1: 11 are from Melrose. This year, 21 students have applied for acceptance at the vocational school. I don't say that all of them will either get in or be eligible or choose to end up there, but 21 is a bigger number than what we've been dealing with. We accept students in grade 9 and

▶ 8:03 Speaker 1: grade 10 another factor I think we should understand is what is being taught at the vocational school first of all we are offering vocational programs such as auto body auto technology business technology carpentry cosmetology culinary arts dental assistant drafting and design design and visual communication early childhood health assistant health and ventilation metal fabrication plumbing and robotics for the first time we offer robotics no the second year we've offered a robotics what was happening in the past is youngsters were expressing a desire to take robotics and we're leaving melrose and picking a school that had strictly robotics which meant that the city of melrose was paying for transportation and other aspects of the individual's tuition we now have our own robotics program which we hope to save money on as well the other thing i want to say too is last year we were very fortunate that we had a lottery and the lottery indicated that the city of melrose was going to receive as eligible receive a ten thousand dollars worth of labor in regard to the vocational school and what they're planning to do is is what the mayor that was here previously wanted a sign program so we're probably designing a sign program for that factor so we we are doing a lot of things up there and i'll let these gentlemen tell you about

▶ 9:55 Speaker 2: what exactly is in the budget thank you thank you madam chair so as mr hooten said i'm currently superintendent at northeast and we like to refer to northeast as also melrose's other high school i'm just going to take a minute because i'd like to save time at the end for questions but historically I've been able to come up here and give you some examples of some of the progress we've made in the past year and and and I'd like to do that right now this year 68 of our students received the Abigail Adam scholarship based on their MCAS scores in their merit of those students we had two Melrose juniors who received that award Andrew Durant and Michael Iacone very proud of those boys as Henry had mentioned earlier we also implemented a robotics and automation program the most important part of that implementation as it has to do with our budget is it was 100% grant funded so we were able to use funding from our Perkins grant to get the program up and going and most recently we received a grant from the governor's office a capital skills grant to further equip the shop so the majority I'd say 99% of the the funding going forward into next year is also from these grants every year we compete in a contest it's called skills USA it's an amazing contest that's in a national competition we compete regionally winners go forward they compete on a state level and then if we're lucky going forward students can compete on a national level this year has been our best year we received four gold medals in the state competition which means those students will go on to compete in the national competition in Louisville so it's a very exciting time within the school one of the the last things I always like to talk about is our dropout rate as of this year we are one-tenth of a percent of a dropout as our dropout rate one of the highest in the state I think that's really important when I talk about these last statistics that over 21% of our students are on IEPs 51% of our students are considered high needs 36% are considered economically disadvantaged so when you compare similar towns and similar schools with those high rates and we look at our dropout rate in our high rate of the out of Abigail Adams scholarships and some of the other great things our kids achieve we're real proud of them so I will move on to the fun stuff that the budget for mr. Picone to present thank you so I'm going to talk

▶ 12:53 Speaker 3: to you a little bit about the budget process what we go through on an annual basis so the goal of the FY 19 budget and the goal of any budget that we set to create is we have two goals in mind we want to minimize financial impact to our member communities and we understand we're a partner in this with with all our communities we don't want to increase the assessment past a point where it'd be uncomfortable for our cities and towns we understand you're under the guise of prop two and a half considering how much revenue you can raise on an annual basis and that's constrained I know Melrose is a 96% residential tax base so the amount of revenue that you can raise on an annual basis is limited and I understand we also understand that and we're very cognizant of the fact that you have other departments that need to be funded fully so when we put together our budget we want to make sure that we're taking those things into consideration all the while we want to provide an adequate level of funding to support student learning and foster educational excellence because ultimately that's what we're here to do as Melrose's other school we want to provide an excellent education for the students of Melrose

▶ 14:08 Speaker 3: that come to Northeast so regionalization exists by definition to offer services that are reduced costs to the member communities and our initial budget goal when we set out we want to keep our assessment costs at or below a three percent increase which is a four hundred and twenty three thousand dollars in the last year I'm happy to report that our actual assessment increase we're able to keep at three hundred thirty six thousand one one seven which is a two point two eight percent increase now it is a slight

▶ 14:40 Speaker 3: uptick in the total assessment cost but there are considerable amount of operating costs that exist in this budget that did not exist in previous budgets and I'll get into that in a little bit so we were able to realize

▶ 14:58 Speaker 3: this small assessment increased by two factors and both come from state funding our chapter 70 formula FY 19 indicates we're projected to receive nine million five ninety seven 852 of chapter 70 funding and our transportation reimbursement is projected to be eight hundred and eighty thousand dollars so why that's significant and our chapter 70 funding going to nine million five ninety seven eight fifty two that's four hundred and forty five thousand dollars more than we received in chapter 70 last year then our budgeted aid that we received in FY 18 so we're gonna use all of that to offset the member communities assessments which we did in the FY 19 budget we also intend and we did use the $880,000 which is equates to around 72% reimbursement for regional transportation is exclusive to regionals we're reimbursed on our transportation costs at a 72% rate so that $880,000 it was also used to offset the FY 19 budget and additionally we intend to use 1.4 million dollars from our other funding sources to further reduce the assessment costs now in this operating budget we We have $1 million in operating costs that is attributed to the fact that we've just been invited to the MSBA program. That $1 million is going to be used for a feasibility study that we need to appropriate in order to use that money in the FY19 budget. If we didn't include it as part of the budget process, we would have to go back to each member community and get a unanimous vote. on using this funding, so we wanted to include it as a part of the budget process. But I am happy to report that $1 million, that is going to be completely offset with revenue that we've been able to save over a multi-year process. We knew that this expense was upcoming, and we wanted to take steps to be able to fund that. So that $1 million does not affect anyone's assessment, does not result in any increase of assessment to the member communities. So when in total we plan to use $2,280,000 of other funds to reduce the member assessment. And the resulting revenue increase over the FY18 budget results in $1,495,687 more than we used last year to offset the member assessment.

▶ 17:49 Speaker 3: so our funding our operating budget cost is it went up significantly for the following reasons we again increased funding to finance a school but building design study which was required by law

▶ 18:05 Speaker 3: also increases in GIC health insurance costs as we know health insurance goes up on an annual basis regardless of what carrier you're with we have GIC and and we're projected to go up about $110,000 for health insurance costs. Increases in transportation costs. We're entering our last year of our transportation contract. We went up $10 per trip. That equates to about $64,000 more in funding that we're gonna need for next year. Additional professional support staffing to meet student needs. We only have a 1.0 increase in our budget for an FTE. half of that being the fact that our given the state of our federal awards federal grants we had to pull one of our positions that's normally funded by a grant into the budget and the other 0.5 is a PE staff that we need to support the students and contractual salary obligations our steps and lanes went up about five hundred thousand dollars based on their collective bargaining

▶ 19:14 Speaker 3: settlements so all told our operating budget went up 1 million 831 804 but i will point out million of that is for the op for the feasibility study that we needed to appropriate

▶ 19:29 Speaker 3: but of that 1 million 831 804 again i i mentioned that we're using 1 million 495 687 to offset that increase and the resulting total assessment increase for all member communities is 336 000 117 as I mentioned however as mr. Hooten mentioned the assessment is based on numerous things it's based on your income and property wealth I'm sorry let's go back it's based on your minimum contribution which is a Department of Revenue form a formula that is determined by income and property wealth and it also is determined on your population that goes to the school the department of revenue determined the minimum contribution to decrease by a significant margin I believe Thorp a 98,000 I don't have that in front of me but with the additional loss of students of point of eight students that means your decrease or increase or decrease um for fy19 is 108 131 as a result so at this time if

▶ 20:44 Speaker 3: anybody has any questions i'd be happy to answer thank you uh at this time i so far have one

▶ 20:48 Jennifer L. Lemmerman: alderman in queue um i will note that we are at 751 um and we do need to recess for the full board

▶ 20:58 Peter D. Mortimer: motion of recess madam chair i'm the one alderman in queue but i'll uh reserve my comments until uh after the break i'm sorry we have to do this to you uh yeah we apologize to keep you a little

▶ 21:08 Speaker 4: bit extra um as i mentioned at the beginning we do have some public hearings that must start on time and so we have to open for those um and then we'll come back to this as quickly as possible