Selectmen Change Course on '13 Default Budget
Number to go before voters will now be $574K below proposed 2013 operating budget.
As a result of a split 3-2 vote by the Salem Board of Selectmen Monday, the town's proposed 2013 default budget will be $574,939 less than the proposed 2013 operating budget.
The vote came after selectmen agreed the week before to reconsider their Nov. 26 decision to set the default budget at $187,693 more than the operating budget.
Selectman Everett McBride, Jr., cast the deciding vote on the original vote, the vote to reconsider and the vote to set the new default number.
This is the first year the town of Salem has calculated a default budget with the town voting to change to the SB 2 form of government earlier this year.
In 2013, Salem will vote on the town's operating budget at the polls on election day in March. Should the operating budget fail, the default number worked into that article would automatically kick in.
The impetus to change the number to one lower than the proposed operating budget came from Selectman Stephen Campbell.
Since the discussions on the default budget began, Campbell felt town staff was using a different interpretation of state laws to come up with the default number from what he believed was correct.
After it was voted to reconsider the default number, Campbell met with town staff and explained he believed two figures ($500,000 for snow removal and $262,632 for three eliminated positions) should have been deducted to bring in a lower default number.
In a memo explaining his reasoning, Campbell said the snow removal funding was originally not in the default number but town staff was "talked into adding it" by an "outside lawyer" because it is a public safety issue and the town has a plan to plow roads.
"I can find no mention in any RSA that says there is an exception...in calculating the default number for those reasons," Campbell wrote, adding Town Manager Keith Hickey "seemed to agree that a strict reading" of the law would not include the $500,000 in a default calculation.
As for the eliminated positions, Campbell wrote that since the money is "not likely to recur in the succeeding budget," it should not have been added in accordance with the law.
"It is clear to me that since we are not asking for the money for these three positions that they are one-time expenditures that should be deducted from the starting point of the 2012 budget," Campbell wrote.
In response, Town Finance Director Jane Savastano wrote her own memo, saying staffing changes for 2013 are "currently not reflected in the 2013 operating budget."
Savastano said the part of the law Campbell was citing referred to "one-time appropriations" and the staffing reductions don't fall in that category.
"Legal counsel and I both agree that employee positions should not be considered or classified a one-time appropriation with the rationale being that these positions have been included in the town's operating budget for many years," Savastano wrote.
On the winter operations funding, Savastano wrote that with the change to SB 2, the town found itself in "a very unique circumstance" for handling that number within the default budget.
This is the first time in Savastano's career in Salem that any winter operations funding has been in the operating budget. It was previously always "a separate or special warrant article."
She wrote that because plowing and winter maintenance is "an annual obligation," the funding "was added into the default budget categorized under increases as a cost incurred mandated by policy."
"I have respect for the staff, particularly because this is the first time we've had to do this," Campbell said Monday night. "And I wish Concord could write laws more clearly to make all our lives better, but (that funding) I believe should be deducted from the default number as written."
McBride said after reviewing both explanations he agreed with Campbell.
"To me it seems to make sense," he said.
Selectman Jim Keller sided with the town staff, finding it "hard to take the opinion of the town manager, the CFO of the town and legal counsel and say, 'I'm smarter than them, I should think differently than them.'"
After a lengthy discussion, Campbell, McBride and Chairman Pat Hargreaves voted in favor of reducing the number while Keller and Selectman Mike Lyons voted against.
If the operating budget fails, there is a seperate winter weather operations article for $250,000 on the 2013 warrant.