Finding Our Financial Path

by Glenn C. Koenig, Webmaster at Town Wide Mall

Maynard, MA - The tone of the discussion at Maynard’s Joint Budget Review meeting last Saturday (Feb. 8th) was honest and calm, but many of those present mentioned feeling worried inside.
With costs increasing but revenue sources limited, the town is facing some difficult decisions, overall.
The discussion centered around the next fiscal year, from July 2025 through June 2026, known as "FY 2026."

The meeting was held in the Maynard Fire Department Training Room, in order to accommodate all the participants, including the Select Board, the School Committee, the Finance Committee, and other public officials.

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The budget includes both the costs of running the town for the next fiscal year, as well as an estimate of the taxes and other revenue that will be needed to pay for it all. 

The meeting was not held to make any decisions, but rather to share information and collaborate between committees and departments before agreeing on a budget proposal for the town, overall.  Once the various parts of the proposed budget are finalized, a summary will be printed in the Warrant (the agenda) for Town Meeting.  At Town Meeting, the Finance Committee will give its report, the budget will be discussed, and then it will be voted on by the registered voters who attend the meeting.  Town Meeting is scheduled for May 19th, about 3 months from now.

Both Maynard’s State Senator Jamie Eldridge and State Representative Kate Hogan were first on the agenda.  They reviewed aspects of the state budget and potential impacts on local funding for Maynard.

I arrived just after 10 AM, right as the meeting paused for a short break.  From what I was told by those who had been there from the start, the general message was that state revenues were expected to be steady, but that expenses for the town were rising faster than income, the lion's share of which comes from property taxes.  The Town Administrator and the Superintendent of Schools had both presented their draft budgets.

How Much Are We Talking?

To get a general idea of how much money is at stake, the 2025 budget (the most recent) can serve as a good example (see table here).  It shows that the town started with about $54 million of income to work with.  Almost half of that was for the School Department.
Another $10 million went for employee benefits.  Payment of debts, including principal and interest were another $5 million.
I listed these three budget items first, because after they are covered, only about $14 million is left to cover everything else the town does.
Of these three items, voters have very limited options.  They can only change the total amount of the school budget, but not the details within it, by state law.  The School Committee determines the details of their budget.  The Employee benefits and debt payback items are predetermined by employee contracts and payments required on the bonds that the town has used to borrow money in the past.

Details on which I based the above table are from last year's Joint Budget Review meeting which is available on the town's web site:  https://www.townofmaynard-ma.gov/ArchiveCenter/ViewFile/Item/250, and from the Town Meeting Warrant from the Spring of 2024, Article 6, starting on page 11: www.townofmaynard-ma.gov/DocumentCenter/View/2921/Annual-Town-Meeting-Warrant

For those who really want to dig into the details of how the town works, I suggest you try the Annual Report.  State law requires every town to produce one, every year.  The latest one compiled here in Maynard is for calendar year 2023 (the 2024 report is being prepared now and will be available before Town Meeting in May).  The link to the 2023 Annual Report is here: https://www.townofmaynard-ma.gov/ArchiveCenter/ViewFile/Item/261

The latest issue of the Maynard Advantage Newsletter (published by the Maynard Marketing Task Force, an independent non-government group) contains more details about the meeting just held, along with breakdowns of the dollar amounts discussed, and links to the presentations made by the Town Administrator and the School Department.  The link to their latest newsletter is: https://maynardadvantage.com/the-maynard-advantage-february-2025-vol-19/

Taxpayer Impact

There was serious concern expressed by those at the meeting regarding the financial impact on residents of the town, not just because of rising property taxes, but also increases in water & sewer rates, trash stickers, and the prospect of adding a new storm water fee.  Payments on the debt, to be incurred for building the new Green Meadow Elementary School, have yet to have an impact property tax bills, but they will soon.
The Finance Committee often calculates the amount of tax increases on the average single family home in town, but that does not reflect the situation many home owners find themselves in, based on their income.  Some residents on a fixed income cannot afford to pay significantly more in taxes, even though their home may be worth significantly more than it was when they first bought it, perhaps decades ago.
One participant acknowledged that while the average income in Maynard has gone up, people at the lower end of the income scale, such as those on Social Security, are not seeing enough increases in their income to keep up.  He was concerned that some long term residents of the town would be "priced out" of living here and thus be forced to move.  At the same time, many of those same residents have waited for years for the town's senior center to be relocated to a more suitable facility.

There was some discussion about more completely separating income and expenses for both water and trash pickup, using a dedicated account for each, known as an "Enterprise Fund."  The idea is that residents have some control over how much water they use or trash they put out for collection, so they may be able to reduce their costs.
But even with such a change, there would still not likely be enough revenue to cover all the anticipated expenses.  One possibility would be an "operating override" - a voter approved tax increase, just to provide more funds for regular expenses.  This is different from the more common "capital override" where taxes are raised to borrow money in order to build or renovate buildings or other major physical infrastructure.

Commentary

The questions on many people's minds are likely to be: Why does it cost so much to run the town?  And why were those at the meeting worried?
From what I sensed at the meeting, board members and public officials are very sensitive to the impact of increasing taxes and costs for residents. At the same time, trying to keep costs down has become more and more challenging over just the past few years.  Some of the factors that contribute are:

• Costs of equipment, materials, labor, and benefits are all going up, as they are for all of us.
• The limit on property tax increases (2 1/2 % per year), is set by state law.
• Opportunities to increase the tax base (new construction or property improvements) are very limited.
• New requirements by the state and federal governments for things such as water quality, wastewater treatment, police and fire procedures and training, school curricula and additional student services, etc. require that the town adapt, often increasing costs.
• Unpredictable policy changes at the federal level mean that funding sources may soon be unreliable.

The limit on new construction is not only due to a lack of available land, but also based on our limited water resources.  Maynard has its own water system; it is not part of the MWRA.  (Connecting up to the MWRA has been discussed in the past, but the cost would be significant and require a multi year construction effort).  Constructing and maintaining a water system is extremely expensive and requires extensive long term planning and financing.  And yet, water is one of the most important things the town provides.  Without water that meets current health standards, there would be no town.

Even though Maynard is not that big a town (under 11,000 residents, living in approximately 3 square miles), it must provide most of the functions and services that larger towns do, but on a much smaller income.
Some residents may be wondering why we don't work harder to keep salary increases to a minimum when negotiating union and employee contracts.  I can see three reasons why such an effort can come back to haunt us.  That's because Maynard doesn't exist in a vacuum; we must consider factors beyond our control.
First, there is a trade-off between paying lower salaries and employee turn-over.  Unless we keep our salaries somewhat commensurate with what other towns pay, we run the risk of employees jumping ship for a better pay package elsewhere.  When that happens, we actually lose out by having to spend time (and money) as we search for, hire, and integrate replacement staff.  Some positions in town require an understanding of long term plans and projects.  When experienced managers leave, that experience leaves with them.  A new hire will likely take significant time to properly grasp the complexity of many of these projects.
Second, our employees have to live somewhere. They are subject to the same increase in the cost of living, including the high cost of housing in this area.  If we don't pay a reasonable wage, then they will likely be squeezed between a modest salary and the increasing costs of living nearby and end up moving to too far away to continue working here.
Third, with Maynard as small as it is, employees and especially managers often have to wear multiple hats, and frequently work longer than 35 or 40 hours per week, just to get tasks completed.

So, our true challenge is to find a balance between these factors and our financial resources.  This is significant because much of the cost of running the town is in wages and salaries.  The town is essentially in the service business.

Change is in the Air

During the budget process, Maynard, like most towns in the area, typically has looked back at previous years and attempted to make minor increases or decreases, based on past budgets.  But recently, the job has become a lot harder.  I say that because we are now in a time of very rapid, profound, and unpredictable change.  It's much harder to plan for what we will face next year based only on our history over the past few years.  Think of it this way: Instead of driving gradually up hill on a highway, we're likely in for more of a real roller coaster ride.

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