• Thu. Apr 18th, 2024

Chelmsford Town Manager asks boards to aim for $163 million FY2025 town budget

CHELMSFORD — The Fiscal Year 2025 budget process began for Chelmsford Monday evening with a joint meeting between the Select Board, School Committee and Finance Committee, where Town Manager Paul Cohen asked for the town to aim for a $163 million town budget, a 4.95% increase.

Cohen said in his presentation to the joint committee that Chelmsford is facing multiple challenges going into the new budget season. That of course includes the impacts of inflation, Cohen said, at a time when inflation is the highest it has been in decades. The challenges also include increasing demands on infrastructure capital and uncertainty surrounding state aid and how much Chapter 70 money Chelmsford will receive while the state faces its own slate of economic challenges as a whole.

Chelmsford Finance Director John Sousa said that when it comes to budgeting for capital planning, this year is particularly challenging.

“The needs were much greater, making this one of the most challenging years with capital planning that I have ever been involved in,” said Sousa.

The Capital Planning Committee had reviewed 41 capital projects that would have cost more than $11.2 million, Sousa said, but only voted to recommend approval of 21 projects totaling $5.8 million.

“20 projects were actually deferred,” said Sousa.

Cohen said the state as a whole is facing the challenge of rising health care costs, while also falling short in tax collections.

“For the first five months of this fiscal year, every month was below their benchmark,” said Cohen. “The November benchmark missed by $274 million.”

The state, Cohen said, has both a revenue and a spending problem.

“They are doing many noteworthy and beneficial things from healthcare, to care for migrants and everything else, but it is at an unsustainable level,” said Cohen.

Cohen also pointed to the recent labor dispute between the Andover School Committee and the Andover Education Association that resulted in 15.5% contractual increases for teachers and 34% increases for instructional assistants over four years, and said that it should be a sign that Chelmsford should also prepare for its own negotiations with the teacher’s union in the near future.

“We have contracts for the upcoming year, but I want you to be thinking not just of the year ahead, but where it goes after that,” said Cohen. “Our contracts have 2.5% for the final year, but nobody is settling for anything that starts with a ‘2’ right now.”

Going into this next budget season, Cohen said the goal for Chelmsford should be to maintain the town’s services while meeting the fixed cost increases amidst the pressure of a high inflation economy.

“We have to be responsible in maintaining the town’s capital infrastructure, because you can’t defer roofs, and you can’t defer the infrastructure because it is only going to cost more,” said Cohen. “It is more expensive to fix it than it is to replace it.”

The joint committee voted unanimously to aim for a $163 million revenue target for the town’s budget. Cohen’s office will begin putting it together, and will formally present an operations and capital budget Jan. 29, 2024.

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