HOLDEN — At Holden’s annual town meeting, to be held at 7 p.m. May 15 at Wachusett Regional High School, the Holden Finance Committee will recommend a budget that will increase taxes 5.5%, which means the average house will see an increase of $368 on its tax bill. This larger- than-desired increase is driven by a 6.1% increase in the education budget, which makes up almost two-thirds of the budget, and increased debt incurred to build the new DPW facility. The town-controlled portion of the budget is up a modest 2%.
There is reason to hope that the Wachusett Regional School District budget will be reduced before payments are due, for two reasons.
One is that the state legislature has proposed a budget that fully funds regional school districts’ transportation costs for the first time, a change that could bring a reduction of $250,000 to Holden’s assessment. The second reason is that this version of the budget does not include the use of any E&D (internal funds) by the WRSD due to faulty accounting over the past few years. The WRSD has new management and is getting the accounting cleaned up, and has committed to using E&D money to reduce the assessments when the necessary state approvals are received. It is too early to estimate what impact that may have on the assessment, but in prior years it has been between $400,000 and $500,000. If these two changes are realized, taxes could be $100 per house lower.
Sixty percent of the budget is for the WRSD. The WRSD has proposed a budget of $116.2 million, which means an assessment increase of 5.2% for Holden. Increased transportation costs are a major driver as fuel and repair expenses climb, as well as lack of competition for the bus contract. Combines, those factors result in a 15.2% increase in transportation costs. Benefits, like health insurance and pensions, increased 7.2%, and employee salaries 3.9%, as the new superintendent seeks to add and retain staff.
The municipal portion of the budget proposed has a very reasonable increase of 2%, achieved through the reduction of contributions to savings accounts, a very tight capital budget, and no significant personnel additions. Contributions to two savings accounts are unfunded, and one is funded at a reduced level. The latter, funding of OPEB obligations, is near the minimum. Revenue estimates were set higher. Capital expenditures were reduced significantly, which exposes the town to some level of increased risk in future years. Alternative revenue sources were sought to cover costs.
Overall, Holden is in good financial shape. A stellar credit rating has been maintained while rebuilding our infrastructure (pool, Public Safety and Public Works facilities). The town is very near to achieving theFinCom’sgoalofhaving 15% ($8.8 million) of the budget reserved in savings accounts. The limit of our tax levy capacity is being reached, which means that future significant budget increases may need to be paid for out of savings (a short-term solution) or an override (a longer- term solution). This year’s tax increase is unfortunately higher than anyone would like, but with inflation increasing the cost of everything, it is not unexpected.
The Finance Committee believes that after the WRSD budget issues mentioned above are resolved, the overall increase will be reasonable, and we recommend that you support the budget as proposed.
