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Welcome to this special episode of our election 2026 coverage. Um, we have been welcomed into the historic, uh, Lyons hearing room, uh, to meet with our town manager, Jim Feeney, uh, to take a deep dive into the, uh, budget, how the budgets, how annual budgets are made, uh, what is involved with that, and how that all relates, uh, to the fact that there is an override question on, uh, the ballot for this year, 2026. So first of all, as always, Jim, we appreciate you being here.\n\nSpeaker 3: Thank you very much. Welcome. Yeah.\n\nSpeaker 2: And thank, yes, thanks for welcoming us into your living room, so to speak. Um, but, uh, yeah, we do want to get into, you know, a deeper discussion about the override in its various elements. Um, but let's start at the beginning. Um, there are probably folks out there either new to town or new to this kind of news, wondering what is an override.","timeStart":8.175,"timeEnd":71.525,"chunkIndex":0},{"id":"4e87a65d-324c-4b86-ae70-67015ae85545","content":"Speaker 3: Sure. Thank you, James. And as you'll see on the screen behind us, we have pulled up, uh, the town of Arlington's information page on its website about the upcoming annual town election and the ballot questions that will be on that election. So I think to understand what the override is and how that impacts what we now know as question one, we should probably first start with a primer on proposition two and a half. Mm-hmm . For folks who are new to Massachusetts, it might be, uh, sort of something that is news to them. So, proposition two and a half as we know it, or Prop two and a half, is a statutory measure implemented in 1980. That effects of effectively sets a tax cap for all, uh, cities and towns in Massachusetts. So it strictly limits the increase in the overall annual tax levy of municipalities each year.","timeStart":72.035,"timeEnd":127.205,"chunkIndex":1},{"id":"0eda8604-f40d-41ad-bbf4-91ccfe1a061f","content":"Speaker 3: So it limits the amount that they can, uh, that any city or town can grow their tax levy, which is how we levy property taxes and how we collect revenue to fund services each year by 2.5%. So, uh, in addition to that 2.5%, uh, you can add the value of new construction or, uh, what we call new growth to the budget each year, is that becomes a new part of the tax base. Uh, but I think one of the misconceptions about proposition two and a half that I come across is that it only applies to the overall tax levy mm-hmm . Or the amount of tax revenue being raised by a community, uh, in a given year. It doesn't apply to individual tax bills. So individual property values and tax bills can fluctuate annually with market activity and as, as a property assessments change to track arms length sales prices in the community.","timeStart":127.825,"timeEnd":192.805,"chunkIndex":2},{"id":"885a88ef-4b2d-485f-830d-dbdc19bd9c71","content":"Speaker 3: So that's just something I wanted to get out there, that it really relates to a city or towns overall budget, but not directly to individual tax bills because it is often the case, it's brought to my attention by newer residents who have may have paid, you know, a significant sum of money for their new home. And what I have to try to relay is that like the appreciation of a property's value over time does not directly result in more tax collections overall to a community. So that means as home prices have continued to rise locally, it does not necessitate a higher property tax levy. Mm-hmm . Taxes may go up on that individual property based on the sales price, but instead the whole system sort of functions, for lack of a better analogy, like a balloon. So as the property values have risen in applying sort of an upward pressure, there's been a general trend downward in the actual tax rate of the community, uh, to make sure that we're only raising the overall levy by two point a half percent mm-hmm . Uh, annually.\n\nSpeaker 2: Okay. So I just wanna, I mean, that was, that was a lot to absorb. Just wanna make sure I understand and our viewers understand mm-hmm . Um, what you're saying is that the two and a half percent limit on how much can be ra it can be raised annually, is on the aggregate budget for the town or for the, sorry, aggregate tax levy for the town. And that, that of course, is going to be different property to property, um, depending on the specific circumstances of the different properties","timeStart":192.805,"timeEnd":291.365,"chunkIndex":3},{"id":"5d826314-6dc9-4133-806a-def38255358e","content":"Speaker 3: That that is. Well said. It really is just looking at the entire taxable parcels of the community, not, uh, individual parcels. Okay. So what that means is ultimately if we ever wanna increase our tax levy by any amount greater than the automatic 2.5% annual increase, it requires a referendum, uh, of the voters in the form of an override. So that override is now a ballot question that will be put before Arlington's voters on March 28th.\n\nSpeaker 2: Okay. And I've lived in Arlington for 30 years now. I've seen a lot of overrides actually in my time here. It seems to be a regular, a a pretty regular thing, and they've always been successful in the time that I've been here. But why is it that we find ourselves in that situation? Why does Arlington need these regular overrides?","timeStart":291.715,"timeEnd":346.925,"chunkIndex":4},{"id":"cfcc27a3-b265-44d5-a0e1-ce89425be98d","content":"Speaker 3: Uh, that's a great question, and of course you're right that we have had, uh, a successful and long track record with overrides, uh, as to why they're necessary. I think I would mention a few overarching reasons. Uh, one is what has been termed over time, uh, a structural deficit, uh, you know, another reason would be what I call below average new growth. Mm-hmm . As I mentioned earlier, that is one of the other ways you can increase your tax levy by new construction and development, and then just generally arlington's, uh, limitations, uh, with land. And I can sort of demonstrate that with a map, uh, in a little bit. But, you know, with regards to the structural deficit, of course, two point a half percent is a somewhat arbitrary cap mm-hmm . And is typically outpaced by inflation. So over time, that can make it difficult to meet our service level obligations or resident expectations.","timeStart":347.345,"timeEnd":407.245,"chunkIndex":5},{"id":"fd2f1e04-def6-49da-a382-d6aaedae64e3","content":"Speaker 3: Mm-hmm . Based on the two point a half percent, uh, restriction. So really what has happened each year for many years, the town of Arlington has had what we've called a structural deficit, whereby the growth in revenues annually has not kept pace with our growth in costs. So a few examples take, you know, health insurance, uh, public employee pensions, uh, utility bills, construction costs, vehicle costs, just to name a few. Mm-hmm . Are some of the, uh, items that were in the market for, uh, a lot. And they have all risen very sharply, for example, in, uh, the past few years. So there's sort of an imbalance there with how much we can raise revenues while still having to fund, uh, increased costs. So in order to preserve existing services or to increase or deliver new services, as is sometimes the case, we need to periodically exceed our levee limit to do so. And, you know, under the law, and as noted before, we need to seek voter approval at the ballot, which is done through these periodic, uh, ballot, uh, questions seeking what we term an override.\n\nSpeaker 2: Okay. So that's the, that's the first of the three prongs you mentioned? Yep. The structural deficit. And it does, just as an aside, 1980 does feel like a long time ago mm-hmm . Uh, in certain ways, certainly having to do with economics and finances. Um, and so that two and a half is not only arbitrary, but like , there's no way that that means the same, uh, in 2026 as it did in 1980. So I can imagine us blowing by that mm-hmm . A certain amount of the time for reasons that, for things that can't be controlled,","timeStart":407.245,"timeEnd":516.645,"chunkIndex":6},{"id":"a9b07c21-a00f-4830-a744-a6a65eb78090","content":"Speaker 3: That that, that's a fair point. And I guess the next prong that I would bring up is what we call new growth. So in addition to the 2.5%, the municipalities can adjust their tax levy annually. We can also represent separately from that 2.5% any new growth, which, you know, amounts to development or construction in a community each year. And the premise is that new development will require added inputs or services of a municipality. So this growth is then calculated separately from the automatic 2.5% annual increase. So this is an area in particular where Arlington struggles. We often rank in the bottom third of the 351 cities, towns, and the commonwealth in the new growth that we're reporting annually. So for example, in fiscal year 23, uh, we ranked 278th out of the 351 cities and towns. And then fiscal year 24, we ranked 271st out of the 351 cities and towns when applying new growth as a percentage of the prior years, uh, levy limit as we know it. So I\n\nSpeaker 2: Haven't, can can you talk about that a little bit more, Jim? Like, what does new growth mean very specifically? Is it new housing? Is it new, other kinds of development?","timeStart":516.995,"timeEnd":602.965,"chunkIndex":7},{"id":"50f9b883-d3ab-403b-937c-6b31ccb64b1f","content":"Speaker 3: So it means a few things, right? So one element of new growth that has, has been particularly strong historically in Arlington is condo conversions. Uh, generally over the past decade, for example, that is accounted for 25% of our new growth. And that is largely driven by as two family and three family homes are sold. And that underlying two family or three family designation, it goes under a conization process. Mm-hmm . And then the individual, the two individual condos that are, you know, sold as individual units, uh, have a greater value than did the, the underlying two family home. So that is in a way part of Arlington's, uh, bread and butter, if you will mm-hmm . With new growth. It's just sort of happening with the natural turnover of those properties. Another area where we, uh, see new growth is, uh, take for example, like the demolition of an existing single family home and the construction of a new, oftentimes larger single family home. Mm-hmm . Uh, being that Arlington is a redevelopment community, right. We don't have any large tracts of undeveloped land to support new subdivisions, where the new growth would be just what had been the value of the land to now the value of the land and the building. Right.\n\nSpeaker 2: You'd get all of that, and that's just right.","timeStart":604.385,"timeEnd":691.845,"chunkIndex":8},{"id":"015a1089-3390-4db3-86b0-52d107e2746a","content":"Speaker 3: Mm-hmm . So what we see is the delta between what had been the value of that existing single family home mm-hmm . And what is the new value of the newly constructed single family home mm-hmm . So redevelopment, as you pointed out, you're only capturing the delta between those two points versus having unimproved land with no structures or buildings on it, and then ultimately seeing construction of new properties.\n\nSpeaker 2: Yeah. And I know you're going to be using a map, uh, to refer to further points that you wanna make, but I think in looking at that, I, I've looked at it myself. You can see that Arlington has been a densely populated, uh, residential community for a very, very long time. So I think that that must be part of what you're talking about here. It's just not possible to find land without stuff on it already. That then needs to be, again, accounted for as you increase the value of that.","timeStart":691.845,"timeEnd":745.885,"chunkIndex":9},{"id":"d5004aeb-b47b-43e1-802b-876edeed8553","content":"Speaker 3: That's very well stated. Right. We are a largely a built out community, right? Mm-hmm . We were developed many, many years ago. And I do have one map that I can bring up. So this is a map of Arlington and, you know, municipalities work on the basis of property taxes, right? So that, that is land and arlington's most precious and most limited resource is of course its land. And that's what forms the basis of taxation here in Massachusetts. Uh, so we are a five and a half square mile community shown here, bordered by a number of different communities. Uh, obviously we were developed a very long time ago, is a largely residential bedroom community. Uh, meaning most of our land was dedicated at that time to residential uses, and much of it to, uh, you know, singles to in three family homes mm-hmm . So as shown here, right, there are not many large, uh, undeveloped tracks of land.\n\nSpeaker 3: The undeveloped tracks of land that we have are largely, uh, protected recreational, uh, spaces or open spaces. So, you know, we're not gonna see, but in rare circumstances do we see sort of, uh, large new developments of previously undeveloped land. One that may come to mind is if, uh, the proposed project for sort of the mu A area in East Arlington, if that were to come to fruition at some point that would represent new growth of previously unapproved land. And at that point in time, that would be, uh, sort of something we would capture as new growth once that, uh, property is constructed. So,","timeStart":746.225,"timeEnd":851.165,"chunkIndex":10},{"id":"01a36dd7-be60-4d84-95a7-36fe5c3bd343","content":"Speaker 2: And I I, I'm just gonna jump in Yeah. And say, Jim, about the mu guard land you were just mentioning, that would be a one example of that, but that also points to the inherent tension here in Arlington between the fact that we need that kind of new growth in order to offset, uh, our budgetary, uh, constraints. Um, but, uh, the, the, the attitude of the community wr large about developing that undeveloped land has been, it's not like everybody's in favor of that by any means. So you're, you really have that push pull between the existing, uh, celebration of the open space that we have mm-hmm . And the protect, the desire to protect that open space with, again, the consequences for that in terms of the money that we have to operate,","timeStart":851.625,"timeEnd":903.685,"chunkIndex":11},{"id":"b7fb9248-6ff4-4ecb-ac52-df8eb1091c6b","content":"Speaker 3: Right? It, it's all about striking a balance here. And so if, you know our five and a half square mile community, you know, we had once taken the time to calculate, so we have roughly 3,500 acres of land within our borders. Uh, but not all of it is taxable, as you've pointed out. So that will concentrate the tax burden on fewer parcels. So what this map does is show an overall view of Arlington, but also makes note of how many taxable parcels we have. So like 61% of our land area as seen here is taxable, right? We have a number of surface water bodies in a very dense, uh, road network that covers 125 center lane miles. Hmm. So amongst roads and water, you know, 27% of our surface area is, uh, sort of taken up by those features and it's not taxable. And then you add in, uh, in sort of the dark color here, the remainder of the parcels that are tax exempt because they may be a charitable purpose or a government use, uh, open space, cemetery, parks, playgrounds, schools, town\n\nSpeaker 2: Buildings, churches, right.","timeStart":903.895,"timeEnd":983.405,"chunkIndex":12},{"id":"b857fd28-7b06-4547-b6b4-71ac190f4b48","content":"Speaker 3: Churches even mm-hmm . Right. There's a long list of things that, you know, are exempt from paying property taxes. Mm-hmm . So here in Arlington, you know, we sort of have a 60 40 split. 60% of our land, uh, is carrying, uh, sort of the full tax burden as 40% of it roughly, uh, is tax exempt or covered by water or roads. But as you've pointed out, I think, you know, our residents greatly value our playgrounds, our neighborhood schools, the minuteman, bikeway, the various open spaces we have that provide for, you know, passive recreation and the environmental and ecological benefits. So, you know, what you described as attention is really, you know, a community really determines, you know, how it wants to look and feel with how it dedicates, uh, its land use.\n\nSpeaker 2: Alright. So, uh, I, I don't want to interrupt. Yep. Like, did you\n\nSpeaker 3: No, I think we Okay. We covered that pretty well. So\n\nSpeaker 2: We'll, we'll move, we'll move on to the next thing, which is, you've just described how 60% of our, of our land is taxable, basically mm-hmm . And that's, so much of it is residential. What about the idea of shifting a little bit more of the tax burden to the commercial side in, in Arlington? What's, what's the problem with that? People might wonder about that. And","timeStart":983.885,"timeEnd":1061.405,"chunkIndex":13},{"id":"91a89e8c-245f-493f-9bad-072e1949d2dc","content":"Speaker 3: I, and you know, uh, something that Arlington is a question that Arlington has to answer every year through its assessors during the tax rate setting process, uh, with the select board. But that is something that many of our neighboring cities and other comparable communities are able to avail themselves of, but it's not really a feasible option here in Arlington. And I have a, an image that might help demonstrate why, you know, other communities based on their land use and historical development may have more land dedicated or devoted to commercial and industrial uses. You know, the city of Boston, uh, and like many of our neighboring communities, I believe Somerville, Cambridge, Medford, Lexington, as well as a number of our comparable communities such as Melrose, Brookline, Milton Needham, Stoneham Wakefield, Watertown, Hmm. All split their tax rate. Uh, and what that means is they effectively, it effectively allows them to shift a greater burden, a greater tax burden onto commercial and industrial taxpayers and away from residential property owners to help control the cost of living in the community here in Arlington.","timeStart":1061.405,"timeEnd":1138.205,"chunkIndex":14},{"id":"4bc2f0fe-596b-4302-87ac-21d37211c42c","content":"Speaker 3: Why this is not really a viable option is because historically as we've been developed, we've landed to have a largely residential tax base. So, uh, this shows our taxable land by type and sort of this cream color shows that by and large our taxable land is there for residential use by land area, it's 56% in terms of the actual composition of our tax base, looking only at taxable parcels, we are a 95% just shy of 95% residential tax base leaving the remaining 5%, uh, comprised of commercial and industrial, uh, taxpayers. So that creates a significant imbalance. So it would take a really large tax hike on our commercial and industrial property owners to meaningfully shift the burden away from our residences. So it has long been believed here in Arlington to do so, would render many of our mostly small commercial mm-hmm . And industrial parcels as, uh, you know, unattractive or unviable in the long run.","timeStart":1138.205,"timeEnd":1212.515,"chunkIndex":15},{"id":"5a721587-320f-49d0-a96a-39b125632ca7","content":"Speaker 3: So there is state law that governs how much can be shifted, and we go through the exercise each year of calculating what that would look like. So if we were to implement the maximum available shift under law and have commercial and industrial property owners pay 150%, for example, of their share of the tax levy, it would only drop the total residential share by about two point a half or 2.6%. So that is a really outsized proportion of the makeup of our tax base. And it being so largely residential, the average commercial and industrial property owner would need to pay an additional roughly $7,600 in taxes under that 150% scheme that would save the average single family homeowner, you know, just over $300 a year. So you, you know, the select board at, you know, with the wisdom and guidance of the Board of assessors has to contemplate each year whether or not effectuating such a shift is worth it, given that it could have a negative impact on those, uh, commercial and industrial parcels each year.\n\nSpeaker 2: Yeah. Which I assume are on this map represented by the magenta, uh, shaded areas. Is that right?","timeStart":1213.375,"timeEnd":1296.065,"chunkIndex":16},{"id":"f66aa92c-2081-43a3-9781-71df4d3fa892","content":"Speaker 3: That is correct. And I would note actually, if you would, uh, take a peek at some of the largest, uh, magenta areas, which are commercial and industrial, sort of in this corner of town, and then in the northern most corner of town, they show up as commercial and industrial for purposes of this map because they do have, uh, a structure on them that's functioning commercially. But those are actually two golf courses. Hmm. This being land owned by the Winchester, uh, the Belmont Country Club, and that being owned land by the Winchester Country Club. So they actually have a special designation, it's called Chapter 61 Land. So that is not necessarily taxed that it's development potential as commercial and industrial land. It's taxed as recreational land each year. Mm-hmm . So at a much, uh, lesser value. So as you can see, you know, we have a few major commercial corridors, but we don't have any significant large business parks or office parks or really significant, you know, depth to our commercial and industrial district. So often what we see in Arlington, our experience the past few years has been sort of mixed use. Right. We, we don't develop out, we develop up mm-hmm . So, you know, single story commercial may become single story commercial with a little bit more commercial on the second floor, and then, uh, you know, a few additional floors of dwellings there above mm-hmm . So that is sort of where we see, uh, commercial development, uh, here in Arlington mm-hmm","timeStart":1296.655,"timeEnd":1385.185,"chunkIndex":17},{"id":"07d6200d-cfa8-4884-a76b-658482550b46","content":"Speaker 2: . And, um, as you well explained, uh, not only would it be a wildly disproportionate burden on, on the commercial side to create even a minor benefit for homeowners, uh, but as we can see, uh, on the map, and as we know from our experience, uh, here in Arlington, our small businesses are very important to all of us mm-hmm . And so we are not talking about big companies that we can feel like, oh yeah, sure, we could, we should get whatever we can from them. This is our neighbors, this, these are the, the businesses we count on thriving and supporting. So again, that there's that kind of tension there between that fact that we all subscribe to and what it means when it comes to the budget.\n\nSpeaker 3: Agreed.\n\nSpeaker 2: Um, alright. Moving forward, um, I'm curious about, uh, you know, you've, you've described how much of our operating revenue comes from, uh, property taxes. What are the other sources, uh, that Arlington can draw from for, uh, our, you know, our operational needs?","timeStart":1385.225,"timeEnd":1456.405,"chunkIndex":18},{"id":"1e7f1edc-c0ab-4adc-b34b-f4f9f3c403a1","content":"Speaker 3: So, that's a good question. Obviously each year, property taxes make up the lion's share of our revenue. Generally around 75% of our budget and operations is funded by property taxes. The next largest source of revenue for Arlington and for most communities is what we call state aid. So that makes up, uh, the next 13% of our, uh, revenue each year. Uh, you know, a note about state aid, obviously that's a number we look forward to each year, uh, in January when the governor publishes her budget. And then, uh, we watch, uh, very closely as the state's budget, uh, process progresses. But we, wherein lies the challenge with state aid is that it is unpredictable and highly variable and frankly has been on the decline if you sort of look at the macro level. So we're certainly very heavily reliant on it, given that it's our second largest source of revenue.","timeStart":1458.025,"timeEnd":1523.045,"chunkIndex":19},{"id":"d02e9df7-e998-4eac-b418-aeea218d0b0d","content":"Speaker 3: But with it being hardly variable and unpredictable from year to year, it even changes in a given budget year from when the governor proposes her budget as it proceeds through the house. Mm-hmm . Senate and conference committee, local aid can change through that process. So it can be a little bit of a moving target. Obviously we're very grateful for, uh, what we receive, but frankly, overall across the state, unrestricted general government aid, also known as AGA and uh, municipal circles has certainly not paced with the economic realities of rising costs at the local level. So that is something that we sort of advocate for on an annual basis with our local, uh, legislators and through the Massachusetts Municipal Association to try to secure as much unrestricted general government aid is possible to help fund operations, uh, at the local level.\n\nSpeaker 2: Okay. Um, I know that lots of folks are involved in, and I think we're gonna be now referring to the chart that's, or the spreadsheet that is behind us. Um, there's a lot of folks involved in, in what's been the robust approach to financial planning here in town for a long time. I'm wondering if you can just take us through the process, um, and kind of who weighs in when and all that stuff, what is taken into consideration, all of which ends up with you making your recommendation to the select board on occasion for an override, as is the case this year.","timeStart":1524.145,"timeEnd":1616.265,"chunkIndex":20},{"id":"408018e3-865f-470d-9746-11594ed7faac","content":"Speaker 3: So each year we convene what's called the Long Range Planning Committee here in Arlington. And it's a very robust process. We do it annually. It's a process that oftentimes takes the better part of a year. Uh, it includes obviously a number of staff, including myself, the deputy town manager, the rest of the town's finance team, but it also brings a lot of the, uh, elected and appointed leadership into the same room. So we have all the leadership of the finance committee, the capital planning committee, the school committee, as well as the select board who ultimately possess the authority to place, uh, proposition two and a half override ballot question on the agenda for voters. But how I at town Manager arrive at a recommendation to the select board for an override is largely governed by what we call the long range, uh, financial plan or projection, which we see behind us.","timeStart":1616.965,"timeEnd":1673.945,"chunkIndex":21},{"id":"bcaa0aa6-d5c9-442d-8e26-b986b8048a9a","content":"Speaker 3: It's obviously, uh, very busy spreadsheet that functions as our financial model and allows us to look at things over a five year horizon. And we generally plan for overrides to cover largely a three year period because that is where we are able to forecast the most credibly or reliably based on the assumptions we make. Uh, so this document here shows a copy of our long range financial projection as of February, uh, 12th. And this was, uh, you know, presented at the Long Range Planning Committee. And it goes through where we, uh, expect our revenues to be, where we expect our expenditures to be. And I would draw your attention, though, it's a very b busy spreadsheet to some of what items have been highlighted, but really the most important line is the balance line. That's the bottom line. So as we look at our revenues compared to our projected expenditures, and when we start to see these deficits or red numbers at the bottom of the long range plan, that is usually indicative of our need, uh, to call for an override to keep, uh, funding, uh, business as usual. And\n\nSpeaker 2: Yeah, you've very helpfully highlighted, uh, the balance line there with the three, three numbers across there, clearly growing at a, uh, uh, somewhat daunting pace there.","timeStart":1674.015,"timeEnd":1771.575,"chunkIndex":22},{"id":"44261b21-9bbb-4fb7-ab75-6740a1b9b5c8","content":"Speaker 3: Indeed. And so you pointed out earlier, we have a, a history of overrides and how we generally fund them if we're planning for them in a multi-year fashion, is you tend to ask for one sum of money in year one that based on your financial model, will certainly carry you through those three years. And that allows the select board to commit to the taxpayers to not asking for another proposition two and a half override prior to a certain period in time. So what we've planned here is for an override that would cover operations from fiscal years 27 through fiscal year 29. So we're planning for a three year override, but it is often the case that we have the ability to extend the funds from our overrides because we've established what's called a stabilization fund. We call it a fiscal stability or override stabilization fund.","timeStart":1772.715,"timeEnd":1830.685,"chunkIndex":23},{"id":"ae9c1c20-0ab0-4ef1-8e1b-fdb11ab31522","content":"Speaker 3: And it's a very special purpose that allows us to, uh, bank excess revenues in a given year to use them to balance budgets in, uh, future years. So obviously there was a proposition two and a half override back in calendar year 23. And what the other highlighted sell here is showing this override stabilization fund that as we close fiscal year 26, which would be on June 30th, we are projecting to have, uh, just over $6.2 million left in the override stabilization fund that was funded through the last, uh, operating override. So that amount of money was sort of stretched out and is being carried forward for, uh, use as a revenue source in fiscal year 27. And that is why the fiscal year 27 deficit sits under, uh, you know, just shy of $3 million because those dollars from the prior override are being, uh, stretched further. So they don't get spent on any additional purpose. They're only sort of banked, stored, and used as necessary to fund future years in the budget.","timeStart":1830.705,"timeEnd":1904.005,"chunkIndex":24},{"id":"df2e6a8f-b80d-48b6-b507-2ccc9a7905ec","content":"Speaker 2: Okay. So again, that was a lot of information. Uh, I just want to distill it as best I can. Um, three years ago, basically an override passed mm-hmm . At that time, the, the amount of o of the override that you were asking for has stretched over the three year period plus left 6 million, little over 6 million still to use. And you're applying that to this, the, the now the fourth year from that override. Correct. Um, which in, in that way, as we look at those red numbers there on the balance line, uh, it does look kind of startling to move from 3 million in or just under 3 million in fiscal year 27 to almost 18 million mm-hmm . Uh, in the following year. Um, but the, you, you add the 6 million in and now you're looking more like at 9 million, et cetera, and then it, you can see, you can kind of trace a little bit more easily. But, um, I think people need, uh, that it's important for people to understand that yes, this is a very large override. Uh, I think the biggest of, of my time here in Arlington for sure, uh, that is being asked, but that there is this long record of getting to the o the end of the override, oftentimes with a little bit of money left, and then that money is going to be applied to the very specific budget purposes. So hopefully lowering the number that needs to be asked for at the next override is that,","timeStart":1904.675,"timeEnd":2003.085,"chunkIndex":25},{"id":"941c68fd-c522-415c-984b-8f84ee646254","content":"Speaker 3: That that sums it up effectively. Okay. You know, you know, the balance becomes a revenue source in the future. And we do that because the select board through their override commitments sets firm expenditure caps on any discretionary spending. Right. We're, we're going to limit, you know, the Arlington Public Schools education budget to growing at 4% annually and limit the general governmental, like the town departmental operating cost to growing at three and a quarter percent, uh, annually. So if some of our revenue that is, uh, projected somewhat conservatively, if we have a net revenue gain and we increase our revenue, we don't turn around and spend it, it gets certified as free cash. And that is a municipal term. You know, obviously no cash is free, but that it gets certified and becomes part of a future budget. So just because we have a surplus doesn't mean, uh, we will go ahead and spend it.\n\nSpeaker 2: Alright. So I think that that answers my next question actually, which was, uh, what happens? Clearly there are assumptions that are made by the long range planning, uh, financial, uh, committee and, and others about what the conditions will be going forward about what growth in particular revenues or expenses would be. Um, and those are pretty conservative assumptions I think that, that are being made generally. So the answer to, well what if the expenses come in lower or the revenue's higher, you've just answered that, that that really basically that's just gonna be applied to expenses in going into the future.","timeStart":2003.315,"timeEnd":2102.815,"chunkIndex":26},{"id":"6a985bf2-0467-4e23-99c5-30a225994c1e","content":"Speaker 3: Yeah. And right, there are certain revenue sources like the, our second largest revenue source is state aid. We generally budget that conservatively that it's only going to grow at 1% year over year. Now if it, you know, the, the state itself is facing some economic headwinds too, so we don't wanna be overly aggressive, but if that were to come in at, uh, 2% and that is available as a revenue source, then we would use less funds from the override stabilization fund to balance the budget. Mm-hmm . So it just leaves that, uh, sort of element of financial stability there to stretch that period out\n\nSpeaker 2: Further. Mm-hmm . Mm-hmm . So one way or the other, um, you know, it's hard to look at this, at this very, you know, this gobbledygook of numbers, right? Yeah. It's hard to look at it and not see how glaring those red figures are. Mm-hmm . Um, that the, that's really, uh, just a whole lot of money. What does, what does that actually mean? Uh, again, they are startling numbers in some ways mm-hmm . And so, uh, how can people find out what, what that that means in concrete terms?","timeStart":2103.445,"timeEnd":2178.725,"chunkIndex":27},{"id":"19bd37eb-bab2-4105-84bf-2fd8ddf383e2","content":"Speaker 3: Sure. I, at, at the most basic level, right. Given that that is the balance line of this spreadsheet and their red numbers in parentheses, it means there is a deficit. So, you know, expenditures are expected to exceed our revenue estimates herein. And I can show another version of this plan that sort of programs in the override that was recommended to the select board that will eliminate, uh, those red numbers. And we can pivot to that in a second. But if un, if there were either no override vote on the ballot or if it were unsuccessful, both the town and the schools need to have a balanced budget by July 1st each year. So work would need to be done to balance expenditures to our known revenues. So that would lead to, uh, you know, contemplating various different ways to, uh, cut the budget or, you know, trim services. You know, there are any number of things that would be considered. And while we don't have to sort of get into the details of that here today, there are some, uh, presentations memoranda, you know, information available on the town's website as has been presented to the school committee and or the select board that's on sort of the override, uh, page on the town's website that details what some of those considerations might be if we don't have the revenue to support the expenditures, uh, outlined in the long range plan.","timeStart":2179.315,"timeEnd":2271.855,"chunkIndex":28},{"id":"fd216d06-7a68-4c91-a6d5-a19c969d32a9","content":"Speaker 2: Okay. So, um, I mean, basically when we look at those red numbers, we know that if the override doesn't pass, for instance in fiscal year, uh, 2028, um, that's 17, uh, million 841,000, et cetera, that we gotta find somewhere mm-hmm . That we and, and on from there. So, okay. So this is what it looks like without either either an override question on the ballot or if the override is unsuccessful. Correct. Alright. And you have a a signer version to Yep. To, to finish with perhaps. Yeah.\n\nSpeaker 3: And this is the other, uh, version of the long range financial projection that was presented to the select board at their February 12th meeting. And this contains, as the header notes a recommended $14.8 million override. So what we can do is with this financial model, right, it's a spreadsheet. We have a line where we can plug in what, you know, what an expected override would be, how that would impact the property tax levy to see exactly what the dollar amount is that we need to fund business as we know it, business as usual, whereby also eliminating the deficits in those three years. And it was arrived at $14.8 million being the number that zeroed out the balances for those, uh, three fiscal years and projecting to leave a balance in the override stabilization fund at the close of fiscal year 29 under the current assumptions of $9,300. So, so cl close to the bone there, right?","timeStart":2272.645,"timeEnd":2379.045,"chunkIndex":29},{"id":"1b257ff7-5ae0-4bc0-a256-8b8b4e695d06","content":"Speaker 3: When, you know, for a budget that is, you know, $250 million, right? That is what Yeah. Many zeros. Yeah. Many zeroes 0.000, yeah. Far under 1%. So what that means is, right, like the, the select board is only asking for as much as is absolutely necessary to fund, you know, town and school services as we know them today, and not a penny more. Mm-hmm . So that's why that that balance, uh, is so narrowly and tightly calculated. Though I would expect if any of the, uh, revenue assumptions that are made turn out to be favorable and that, you know, we try to plan in that way, you'd rather have something be favorable outside, surprise, rather than, you know, assume that you're gonna mm-hmm . That motor vehicle excise collections are gonna go through the roof two years from now when you don't really know what the automotive industry is gonna be like, or what the general economic condition is going to be like mm-hmm .","timeStart":2379.045,"timeEnd":2446.005,"chunkIndex":30},{"id":"c2dc95f4-c24b-463a-8e84-d3c609db77b6","content":"Speaker 3: That may be, uh, driving, you know, local auto sales. And there are things where you wanna project conservatively in your model because you really can't predict, uh, that well in the future. So we usually use our experience with what we call local receipts, which is motor vehicle, excise tax, as well as, uh, you know, other sources of information for expenditures. Right. We, we can, when it comes to utilities, at least on the supply side, we can, we can and do enter into futures contracts to lock in supply costs for electricity and gas for periods of times. Mm-hmm . Sometimes two or three years, but we don't have any control over the delivery, delivery costs as set by, uh, public utilities. So where we can, we try to achieve some degree of financial certainty so that we know and can reliably project what some of our costs are going to be. And on the revenue side, you know, there are things we, we just can't project what the state, what condition the state may be in a year or two from now. So we try to be, you know, moderately conservative in that regard. So we haven't overshot a revenue estimate and then find ourselves in a situation where, you know, despite an override or despite, uh, our modeling and projections, we still have to make cuts because we were too aggressive on a particular line.","timeStart":2446.005,"timeEnd":2530.765,"chunkIndex":31},{"id":"ff1b3a9e-097a-4c03-9648-868f700e5782","content":"Speaker 2: You know, it's interesting. Uh, some would say that like on a, a personal health level, it's better to see things, the glass is half full, certainly on a fiscal, uh, responsibility level, it's, it's glass, it's, it's safer to see things, it's half empty as you make your projections going forward. Yep. Um, and then just again, hope, hope that any surprises are positive ones that way. Agreed. Um, alright, Jim, thank you, uh, in advance I wanna just say thank you for, you know, putting all of this together and sharing it with us. I assume, uh, that everything you, you've already mentioned that there's an override page on the, on the website that people can get even more information and more specific information about implications, ramifications of things one way or the other. But I, I assume also the maps and everything here that you've been referring to today are also accessible to everybody. I probably on the town's website,\n\nSpeaker 3: Yeah. We're constantly adding materials and after today we'll look at getting those posted as well.","timeStart":2531.545,"timeEnd":2594.125,"chunkIndex":32},{"id":"39650977-0fdf-46b2-965d-7470edace4fb","content":"Speaker 2: Okay. That would be great. Anything that you wanna close with? Obviously this is a very, this is again, the biggest ask yet. Mm-hmm . Uh, I will just reiterate, having been here for 30 years, I've probably seen at least eight or so overrides. And each one, you know, there are always people who are in favor and people who are not. Um, but they have passed each time and it feels like that's an important, you know, thing to recognize. Um, but thank you very much then for your time. And, um, we will just add this to, uh, the number of informative or the amount of informative programming we are aiming to provide, uh, over the course of this election season. A consequential one as mentioned before, uh, we appreciate Jim Feeney, our town manager taking this time. We hope that you have gotten something out of it, as I can tell you I did. Um, and we will certainly see you, uh, for future election based programming and soon. Thank you Jim. Thank you for being here. I'm James Mulan. See you next time.\n\nSpeaker 4: A CMI Productions are only made possible with your support. Visit patreon.com/acmi to learn how you can help.","timeStart":2594.555,"timeEnd":2674.525,"chunkIndex":33}]}}}