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Committee Presents Bleak Financial Outlook

According to Long Range Financial Planning Committee member Chris Felton, Mendon may be facing a $1 million deficit for Fiscal Year 2012 if changes are not made and the state's fiscal position does not improve.

The Committee provided its findings to the Board of Selectmen during a July 26 meeting. "The longer we procrastinate, the bigger the problem grows," said Felton.

The Long Range Financial Committee was formed in 2009 and is made up of three members of the Finance Committee, one member of the School Committee, one member of the Capital Planning Committee, and three citizens at large; two who have previous elected office experience. The Committee's objectives are to provide better insight into Mendon's current and future financial position and to educate residents about the budget process.

According to the Committee's report, a significant reason for the town's financial woes concerns the state's funding of the regional school district. In the past, the state funded nearly 60 percent of the regional schools' budget. However, the current funding formula calls for both Mendon and Upton to gradually fund almost 60 percent of the budget, placing a greater financial burden on both towns.

Currently, the regional schools' budget is facing a $3 million deficit and cuts in services and staff have already occurred.

For Fiscal Year 2010, salaries, wages, and benefits add up to 72 percent of the town's operating expenses, with the regional schools accounting for approximately 49 percent of that number.

Various future override scenarios were also discussed but were dependent on potential school cost increases, Chapter 70 monies, new growth in town, and services in town, among other factors.

During the presentation, resident Dennis Shaheen asked School Committee and Long Range Financial Planning member Don Morin if pay increase freezes for school employees over the next three years would help the deficit.

Morin said it would help, however, other factors including rising health care costs, regional transportation, unemployment, and special education are contributing to the schools' budget problems. In fact, it was stated that mandated out-of-district tuition for roughly 30 special education students totals more than $2.3 million.

Other financial challenges for the town discussed included its limited growth and the fact that the county pension has lost significant value and will need to be built back up.

One thing all agreed on was that contract negotiations, which are up this year, will have to change.

Felton also added that any services that were previously cut over the years would not be brought back.

"This year is going to be nothing but fixing the financial situation," said Selectmen Lawney Tinio.

In conclusion, Felton added that Mendon needs a comprehensive plan which would prioritize its limited resources and address the operating budget and any capital needs.

Due to time constraints and the length of their report, the Committee was unable to review all their findings in detail.

"We've really just scratched the surface," said Felton.

As a result, the Board asked the Committee to attend the August 9 meeting to continue the discussion.


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