Massachusetts Finance Committees - duties per MGL.

Primary responsibility is to advise and make recommendations to town meeting on the budget and other areas of finance. Note: These days, most, if not all, articles on a town meeting warrant involve finance in one way or another.

Oversight of town reserve fund.

Involved in end of year financial transfers between and with in department budgets.

Adjusting revolving fund spending limits.

The above duties are spelled out in MA state law and are expounded in local by-law and policy.

While the above statutory authority or responsibility does not differ from town to town, the role of finance committee and the process does. 

There certainly ways things can be done, things can be adjusted so the process can be smoother, so that an end of the year financial transfer to balance out the end of year budget does not come down to a 4 to 6 week back and forth between two entities.

 A resident view of Templeton finance.

 

Went back thru expenditure reports (BvA), until the report of May 31,, 2020, the account listed on report as 1000-951-900-53-5341-0000, (fire training room A/C), this fund showed a balance (allocated) of $3,500.00 (May BvA was sent out on 6/10/2020) Then the Jun 30, 2020 (sent out on 8/3/2020) the balance suddenly jumps to $7,465.00, without explanation.

Article 30 of ATM, May 19, 2018 (for FY2019 had 4 items; infield groomer - $10,000.00, cemetery garage roof - $10,000.00, fire training A/C - $3,500.00, fire chief vehicle - $35,000.00.

According to BvA of ending May, 2019, the cemetery roof was complete at a cost of $$8,230.00, fire chief vehicle at a cost of $35,000.00, infield groomer (so called) at a cost of $4,343.67 (and counting).

An explanation is due taxpayers where did the additional $3,965.00 come from??

Note: Infield groomer showed on end of year BvA, (6/30/2019, sent out 8/15/2019) 10K allocated with $5,104.60 now spent with $4,895.40 left. Expenditure report sent out on 9/11/2019 shows infield groomer allocated as $4,895.40 and same remaining. BvA for 12/2019 (sent out 1/13/2020 shows additional $929.51 spent on infield groomer. (remember that figure) BvA for May 2020 shows same figures as 12/2019 BvA. BvA dated June 30, 2020 (sent on 8/3/2020 shows infield groomer allocated at $929.51 with 929.51 spent. (I love when a plan comes together.) There is math, there is common core math and then there is Templeton math, try to keep up.

 Why spend more time looking at our own community and less time looking at other communities?

Go to Templeton town website, click boards and committees and click community preservation committee, on left side of page, cpc guidelines for applying funds, click on that and you see "guidelines for project eligibility" look over the document and you find this:

What is the timetable of the funding cycle?

Applications may be submitted between December 7, 2008 and January 31, 2009 for proposals to be considered at the May 2008 Annual Town Meeting.

Unless an applicant can demonstrate that a significant opportunity would otherwise be lost, applications will not be accepted after this date. Community preservation was accepted in 2007 and it is now 2021, talk about keeping up

 First it was annual town meeting in 2013, town meeting voted to move Templeton to a town administrator and then in 2014 annual town meeting, the voters spoke again with article #20

CHANGE TO THE TOWN BUDGET PROCESS

To see if the Town will vote to change Article IV “Advisory Committee,” Section 4 of the Town By-Laws to read:

“It shall be duty of the Town Administrator in conjunction with the BOS to consider expenditures and develop a budget for the ensuing fiscal year of the several boards, officers and committees of the town, as prepared by them in such form and detail as prescribed by the Town Administrator.”; or take any other action relative thereto. Submitted by the Board of Selectmen

On a substitute motion duly made and seconded the Town voted that Article III “Town Officers“ of the Town By-laws be herby amended:

4. “It shall be duty of the Town Administrator in conjunction with the BOS to consider expenditures and develop a budget for the ensuing fiscal year of the several boards, officers and committees of the town, as prepared by them in such form and detail as prescribed by the Town Administrator.”

Passed Unanimously/May 19th @ 8:38pm

This is when town meeting voted to have a town administrator with the board of selectmen put together the budget rather than the advisory committee. The role of the advisory committee was changed by a town meeting vote!

AB Comments:

The Advisory Board fully supports a change to the town budget process, however, the wording and placement of this suggested by-law change ( replacing an article that deals with the

Advisory Board with text that relates strictly to the BOS and Town Administrator) does not seem to make sense and therefore the Advisory Board cannot support the article.

"The advisory committee states they fully support a change to the budget process but not the original warrant article; hence the substitute motion and passage of said motion and the resulting change to the budget process.

Like

Comment

 The annual budget is a community's primary policy statement and establishes the priorities of government. The most effective budget process follows a formal calendar that begins in the fall of each year with revenue and expenditure projections, also known as a financial forecast. Moving forward, major milestones in the process often include these components:

 ▪ A joint meeting of the selectmen, finance committee, and school committee to review revenue projections and reach consensus on overall expenditure levels, use of reserves, and allocation of resources generally 

▪ Distribution of budget guidelines to department managers so they can begin to prepare their appropriation requests 

▪ Deadlines for submission of departmental appropriation requests and for preparation of a working, or draft, budget document 

▪ Completion of meetings with department managers to review requests 

▪ Adjustments to revenue projections 

▪ Formulation of the initial budget recommendation by the town manager/administrator, finance director, or finance committee (depending on government structure) 

▪ Budget approval by the board of selectmen in its capacity as the town’s chief policymaker 

 ▪ Budget review by the finance committee with a deadline to ensure the printing and distribution of the town meeting warrant in sufficient time for town meeting members and residents 

These steps all culminate in the presentation of an annual budget recommendation to town meeting. Throughout the process, decision makers should recognize and adhere to formal financial policies, such as those guiding the use of free cash and stabilization reserve funds and establishing debt levels. 

The budget’s layout or format should be carefully considered since it tells town meeting the level of detail being voted on. It reflects a decision on the degree of management flexibility the town chooses to give department heads because it allows or restricts their ability to transfer money between budget line items without town meeting approval.

 Finally, the budget adopted by town meeting should be closely monitored throughout the year. This involves reviewing financial data to verify that expenditures are consistent with town meeting votes, line items are not overspent, and receipts are tracking in line with expected results. Monitoring actual performance against the original budget can reveal problems early and give policymakers and managers time to take corrective actions to avoid potential deficits.

This is from the MA division of local services, January 2020 on annual budget process in towns.

 An opportunity for Templeton Advisory Committee to return to it's "Glory Days."

Another example from a report to Town Meeting from an Advisory Committee, again, a town with a town administrator.

The recommended operating budget (article 5) for FY2022 is $23,662,176. This is an increase of $633,807

(2.8%) over the FY2021 operating budget. The increase is due to several factors which include:

• An increase of $147,000 in “Schools” is due mainly to an increase in the town’s portion of the Monty Tech Assessment due primarily to an increase of thirteen (13) additional Westminster students

attending the school.

• An increase of $76,655 in “Retirement and Pensions”, a 7.8% increase over last year, due to an increase in the Actuarial Accrued Liability.

• A net increase of $161,690 in “Fire”/”Ambulance” which is a 4.9% increase over FY21, due to the promotion of two privates to Lieutenant and increased call volume. A portion of this expense will be offset by Ambulance receipts (Refer to article 5).

• An increase of $77,592 in “Police/Dispatch”, which is a 3.6% increase over FY21; this net increase is due to contractual salary increases as well as an increase for the creation of a new full time School Resource Officer position. The majority of the new full time position cost was offset by planned overtime expense which would have been incurred absent the new position.

Also included in this town's advisory committee report is an explanation of the effect on tax rate with every increase of 100 thousand spent.

This is just another example of an advisory committee doing it's job. Templeton town meeting gives advisory committee two opportunities to speak to town meeting which would allow advisory to do some thing for the town residents besides bitch about the selectmen and administrator. First, advisory could do something really constructive and bring a well written informative report to town meeting, explaining some of the warrant articles, especially ones involving dollar figures. Second opportunity is to bring a report of the committee, under the consent agenda, perhaps inform town meeting what they have looked at regarding town budget, process, procedures, state school funding, etc. Taking this approach could get people to follow and want to be part of the advisory committee. It could most certainly help out those who attend town meeting and after all, that is their true mission, according to their own handbook put out by the association of town finance committees.

 Listening to last advisory committee meeting, I heard stated that the reserve fund is not to be used for salaries. This evening, I receive email from the MA division of local services (DLS) which discussed a few topics, one was on municipal workforce and in part, stated "Vacancies disrupt routines and can potentially derail important projects. The search for replacements diverts time and effort away from other objectives, and, in the case of a prolonged vacancy, a community may need to expend additional, unanticipated funds on contract services to fill the gap."

So, a town reserve fund is for unanticipated expenditures and due to any number of things, a town could find itself in need of a position because of a long time, experienced employee leaving employment of town and suddenly the town finds itself in need of additional funds for salary or contract expenses to fill that unexpected gap. If I understand the point of the advisory committee member, the committee should not approve a transfer from the town reserve fund for salary expense per the DLS, but yet in the latest message from DLS, in their "staying informed with DLS" through the latest edition of City and Town, it is stated a town may have to expend funds for an un-anticipated use, which is one of the reasons for a town to have a reserve fund in the first place. Well, that is clear as mud.

 What Templeton current by-law states regarding town budget:

§ 28-7

Preparation by Administrator and Board.

[Amended 5-19-2014; 11-20-2019 STM by Art. 7]

It shall be duty of the Town Administrator, in conjunction with the Board of Selectmen (Board), to consider expenditures and develop a budget for the ensuing fiscal year of the several boards, officers and committees of the Town, as prepared by them in such form and detail as prescribed by the Town Administrator, and further to present and defend the same throughout the review process and to the Town Meeting for action.

What Massachusetts state law shows - MGL chapter39, s16:

Section 16. Every town whose valuation for the purpose of apportioning the state tax exceeds one million dollars shall, and any other town may, by by-law provide for the election or the appointment and duties of appropriation, advisory or finance committees, who shall consider any or all municipal questions for the purpose of making reports or recommendations to the town; and such by-laws may provide that committees so appointed or elected may continue in office for terms not exceeding three years from the date of appointment or election.

In every town having a committee appointed under authority of this section, such committee, or the selectmen if authorized by a by-law of the town, and, in any town not having such a committee, the selectmen, shall submit a budget at the annual town meeting.

Templeton has a by-law informing those concerned who prepares and present town budget, accept it or work to change it, just don't spend time bitching about it or you may appear to be complaining just to be complaining.