Bill Manzi.com

The Boston Globe today highlighted some of the many problems facing cities and towns throughout the Commonwealth.

Across Massachusetts, cities and towns face the prospect of deep cuts in what appears to be the grimmest fiscal year since 2003. Local revenue and state aid can’t keep up with such rapidly rising expenses as employee health insurance, heating oil, and even street paving. School costs, like special education requirements, are sapping local budgets.

Different approaches are being made to the problem everywhere, but I think Beverly Mayor Bill Scanlon has it right.

Town and city officials face a difficult choice: cut staff and programs, or ask voters to override Proposition 2 1/2 and approve still higher property tax bills. In Beverly, for example, officials tried to avoid a tax hike by drafting a budget that would cut 61 full-time positions and close two elementary schools.

“It’s very difficult medicine, and something we’d all rather avoid, but we’re on our own,” said the city’s mayor, William F. Scanlon Jr., an ex officio member of the school board. “The state can’t help us, and we have to find a way to live within our means.”

Some stats on the real problems are in the story:

About half of the school districts in Massachusetts are planning some reductions next year, and one in four expect the most visible cuts, like teacher layoffs, program reductions, or steep fee increases, said Glenn Koocher, executive director of the Massachusetts Association of School Committees.

The Massachusetts Taxpayers Foundation has been sounding the alarm bells:

“More and more communities are going to hit the wall,” said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. “It’s not a pretty picture, and it’s going to get worse before it gets better.”

A good example is Swamscott:

Swampscott, which has about one-sixth the population of Newton, opened a new high school last year at the same time it was closing an elementary school and imposing more than 30 layoffs. More layoffs are needed this year, in part because utility costs for the new high school are $1 million more than the old one, said David P. Whelan Jr., chairman of the School Committee. Swampscott has no appetite for an override, he said, so the school board is cutting instead, with technical education at the high school and band at the elementary school slated to go.

The district still provides a strong education in core college-prep classes at the high school, Whelan said, but cuts and expanded class sizes are eroding the overall school experience.

“We’re unable to provide a well-rounded education for kids at this point, and we’re not going to be able to do it anytime soon without additional funding,” he said.

While each community is in a different place all are headed in the wrong direction. Service cuts at the local level, along with school cuts and larger class sizes and an eventual cessation of elective activities in schools, are what is in store for many communities. It will not be pretty.

Read the Globe article here.

I attended a meeting in Boston yesterday of the Massachusetts School Building Authority. At that meeting Treasurer Tim Cahill and Executive Director Katherine Craven announced that Methuen High School is one of three High Schools in Massachusetts that has been chosen to move forward with a major renovation. From the Eagle Tribune:

The Massachusetts School Building Authority yesterday announced that Methuen High is among 11 public schools in the state and one of just three high schools ready for “schematic design.”

That means the school has moved to the next phase in the process of getting funding for a large-scale renovation, said Executive Director Katherine Craven.

We have worked very closely with Katherine Craven, who is one of the most capable individuals in State Government. Our agreement on the initial scope of the project has shaved a good chunk of time and money off of the project.

“I think this outcome of Methuen and the SBA working together so well has saved the taxpayers and the students of Methuen time and money,” Craven said, adding the agreement has likely shaved at least a year off the project.

This project will be a major renovation that includes the possibility of expansion to deal with space problems and our lack of adequate science labs.

“Where this is a 1970s-era structure and it seems to be structurally sound, we think this is a good candidate for renovation,” she said.

Workers will renovate the majority of the building.

“It’s not just about replacing a few pipes and some paint, this is going to be a major project,” Craven said.

The renovation could involve adding onto the building if they cannot find space for new science labs, Craven said.

Treasurer Tim Cahill has taken the time to come to Methuen and has been a driving force in modernizing our approach to School Building Assistance in the Commonwealth. State Senator Steve Baddour and Representative Linda Dean Campbell worked tirelessly making Methuen’s case to MSBA, and this project could not have happened without them.

Read the Tribune story here.

The legislative proposal to allow civilian flagmen to replace police officers on paid details began drawing the anticipated opposition yesterday, with a mobilization by the forces opposed to reform. From the Boston Herald:

The hotly debated proposal to curtail police road details – part of a series of transportation reform measures – veered toward another public showdown yesterday, with labor leaders passing out literature in the State House and urging lawmakers to oppose the legislation.

The police unions seek delay by asking for additional hearings on the bond bill that contains the legislative language at issue. The legislature appears to be rejecting that delay tactic.

However, top senators said yesterday they intend to insert the reforms into a $4.8 billion transportation bond bill that has already been vetted in multiple hearings. The Senate would take up the bond bill tomorrow, add the reforms and send it back to the House for final approval next week.

“The support from the leaders of the House, Senate and governor’s office is evidence that this bill will move forward in spite of the opposition,” said state Sen. Steven A. Baddour (D-Methuen).

Baddour, co-chairman of the Legislature’s Joint Committee on Transportation, said efforts to curb the use of costly police details have already been discussed in several hearings this year.

In order to block this change the unions will apparently have to defeat the entire bond bill, which will not be an easy task. The language would then have the Governor write new regulations allowing flagmen at certain defined areas. I think the unions will likely lose this legislative battle, and then try to influence the regulation writers in the executive branch.

Read the Herald story here.

There has been plenty of talk lately about the State of Massachusetts and its interactions with the cities and towns, with much of it centered around the ability of cities and towns to join the state health care plan, the GIC. As most know from my prior postings here I have stated my opinion that the seventy percent union approval required to join the GIC is simply unmaneagable.
A link to my post on the “Municipal Meltdown“. But let us take this one step further. The actual need to join the GIC exists at least in part because of the management rights that the Governor has over that plan that Mayors and Managers do not have. From the Massachusetts Taxpayers Foundation report on health care:

The GIC also benefits from greater managerial flexibility than Massachusetts law permits for cities and towns. The GIC is able to use this flexibility to be creative and innovative in controlling its costs, while cities and towns are severely limited by the requirement that all aspects of employee health insurance—including plan offerings, deductibles, copayments,
and the percentage of the premium share paid by the employee—must be negotiated with each individual union. This requirement prevents cities and towns from responding quickly to changing market conditions. In contrast, the Commonwealth does not negotiate its employee and retiree health insurance benefits with its unions; the GIC selects health insurance plans and adjusts plan design, including deductibles and copayments,outside of the collective bargaining process.

The requirement in the law requiring a seventy percent approval by local unions must be abolished. If the State does not desire to do that then a bestowal of management rights akin to the Governor’s over the GIC must be provided to Mayors and Managers. It is the only way to stop what will be endless and pointless harangues from some who continue to argue about the menu while the ship is three quarters submerged. Margery Egan has written a column in the Herald in which she takes to task both City and State officials over the failure of many cities and towns to join the GIC.

Has your town joined the state’s health insurance pool? If not, why not?

Joining would save cities and towns $2.5 billion over 10 years, according to tax watchdog Michael Widmer of the Massachusetts Taxpayers Foundation. That’s enough to pay an awful lot of teachers, firefighters and cops.

But almost no towns have joined, Widmer says, because local unions don’t like the idea. They’d rather negotiate with individual towns. And because the Legislature has failed to give municipalities the power to override these unions, here go the towns again, begging, guilt-tripping homeowners into thinking they’re cheap and mean and cynical when the real problem is no political courage on Beacon Hill or in Town Hall.

I have strongly advocated the removal of this poison pill provision. Additionally I can tell you that Methuen has one very good health care system, with a split between city and labor of 62-38. In the coming weeks I will detail plans for our next fiscal year in health care on this blog. There will be some suprising numbers put out, but that is a story for later. For now let us move over to Speaker Dimasi, who has indicated support for the removal of the seventy percent threshold. From the Boston Globe transcript of Dimasi remarks to the Boston Chamber.

I believe that municipal leaders want to join GIC because they also believe that they can provide savings and good health care for municipal workers.

I also believe that municipal leaders should have the sole decision in determining whether their communities join GIC and deliver on the promise of property tax relief on the local level.

It is a needed recognition of reality, and we appreciate it. But on another score some vital clarification is needed. While it is true that the State has provided additional funding for us in the past several years, such increases have been limited to Chapter 70, education assistance. The general side of local government has been level funded, and will be level funded again this year. Additionally the Chapter 70 funding comes with what is known as “maintenance of local effort”, meaning that the City must pony up a big chunk of property tax dollars to give to the school system. That chunk will likely eat ALL of our local growth, meaning that any pay raises granted must come from existing, flat revenues. Under that scenario we are guilty of overspending if we even give a one percent raise through collective bargaining to city side employees. With normal expenses going through the roof (utilities go up for cities and towns as well) you can see what several years of this means to localities. It is a disaster. Having said that I think that those of us in management at the local level must apply the medicine that is needed to restore fiscal health and let the chips fall where they may. I can also say that in Methuen, our “appetite for tax increases” is not there, just as it is not there at the state level. I bring that up because I am frequently asked by State officials if we are at our Prop 2.5 levy capacity. In Methuen we are about 2.5 million below that capacity, and we hope to stay there. Blue Mass Group has done a posting on this subject that is worth a look.

Read the Blue Mass Group entry here.