Friday, October 3, 2003
Revenue Enhancement Committee brainstorms ways to raise funds
The town should do more to raise income from sources besides the property tax. This was the message the Board of Selectmen heard at their September 23 meeting, as the Carlisle Revenue Enhancement Committee (REC) delivered a report on "potential ways to enhance revenue." Finance Committee Chair and REC Co-chair Lisa Jensen-Fellows outlined the key recommendations, including charging higher fees, tapping surpluses in revolving funds controlled by town boards and committees, and a variety of "new initiatives," such as a social club located in a town-owned building, or levying a transfer tax on sale of property. (See a summary of the REC report, and the committee's report, and study of the Town's fees)
The demand for town services, contractual obligations, and com-mitments to maintain competitive salaries will remain high, said Jensen-Fellows. Although many of the recommendations would provide only "incremental" revenues, even the small amounts to be gained are an attractive alternative to the more politically difficult issues involved in increasing taxes and cutting costs.
As a matter of policy, the committee report suggests that fees should:
• be charged only for "narrowly-used" town services (while "widely-used" services should be supported by the property tax),
• cover the entire cost of the service,
• be reviewed every two years, and that collection should be enforced.
The committee projected that the town could gain about $46K from instituting fees for commercial use of the transfer station and over $20K from increasing the $500 fee currently charged for afternoon kindergarten.
The report also recommends increasing fees charged by nearly every department or board, except the planning board, building department, and resident transfer station sticker fees.
Tap extra $$ in 53 funds
The town has many "revolving funds" (known as "53" funds after the state law governing their operation) which allow town boards to use collected fees to pay for the board's expenses, uually professional services and related costs. "Significant" surpluses have accumulated in many of the funds, and these "should be released to benefit the town," the report argues. The committee urged the Selectmen to ask departments to determine how much of the balance in a fund is committed for ongoing projects and how much is surplus.
REC members expressed concern that spending from some funds is outside "the fiscal discipline of the town," that is, not subject to the scrutiny of the town's budget process. The question is, according to REC and FinCom member Bret Bero, who makes the call about how the funds are spent, the board chair "or a board looking at the whole picture" of the town's needs and finances. For example, the recreation commission has the freedom to add programs or build things, while the Council on Aging, lacking a similar revenue source, has less flexibility, noted Selectman John Ballantine.
Further discussion clarified that most of the total of nearly $1 million in revolving funds the committee had estimated is in the Recreation Commission's fund, estimated by Jensen-Fellows at up to $700,000.
REC also estimated that the Planning Board's revolving fund balance might be as high as several hundred thousand dollars. Reached later, Planning Board Administrator George Mansfield said that the fundwas never close to that magnitude, and the current balance was about $33K. In addtition, these funds cannot be used as town revenue, since any surplus from a particular permitting project must eventually be returned to its developer.
2% tax, electric company, social club?
According to the committee's report, suggested major projects "could provide substantial new revenue streams to the town," ($900K annually from the transfer tax) but "may require significant resources · time, effort and . . . capital." They recommended that groups of volunteers study the ideas further.
The Selectmen seemed to find the suggestion of a 2% transfer tax to pay for capital needs generated by new development "intriguing," as Chair Tim Hult put it. Town Administrator Madonna McKenzie pointed out that many other communities have tried and failed to at getting the required state legislative approval in the past. Historically, any such efforts on Beacon Hill have been strongly opposed by real estate interests.
Other new initiatives
The committee also proposed that the town:
• lease town-owned land for cell towers;
• invest in a municipal electric company;
• establish a social club, preferably in a town-owned property;
• organize volunteers to develop grant proposals for public and private sector funds and to perform other work for the town;
• purchase "life estates" from long-term residents to obtain property for future municipal uses;
• modify existing or design new facilities to generate income from multiple uses (such as a two-story gym with a hockey rink on the ground floor);
• lease capital equipment when not in use and charge rental fees for certain uses of town land;
• charge user fees adequate to cover maintenance and capital costs to the town for use of recreation facilities by organizations;
• save costs through "single source" contracts for supplies and energy-efficient practices in town buildings.
Jensen-Fellows suggested that the Selectmen ask department heads to figure out how much "excess" is in each fund, and how to release it for the town's benefit.
Hult noted that many of the suggested changes in fees and the balances in revolving funds are controlled not by the Selectmen, but by boards and committees. He asked Town Administrator Madonna McKenzie to work with department heads and the treasurer to review fees, as well as "what's in the funds and the flow over time."
Job done, committee disbanded
The Selectmen voted to disband the Revenue Enhancement Committee officially, with thanks for their work.
© 2003 The