Final city budget depends on state

Date: 6/16/2010

June 16, 2010.

By G. Michael Dobbs

Managing Editor

CHICOPEE -- For Mayor Michael Bissonnette, preparing a final city budget for the next fiscal year is a bit of a waiting game.

Bissonnette, like other mayors, is waiting for the Legislature to finish its new budget in order to complete his.

He told Reminder Publications "all that matters is in conference committee. We hope it will get reported out in the next two weeks."

The state actions on local aid and school assistance funding, the Health Insurance Plan Design authority, Pension Amortization Extension, the Municipal Relief Act and the extension of bonding repayment schedules all impact the Chicopee budget.

No matter how quickly the Legislature acts on these items, Bissonnette said Chicopee would have a budget in place for the start of the new fiscal year on July 1. It will be amended based on the state's final budget, he explained.

"We will have a budget in place, " he said. "It's really a trickle down. The Boston budget is built in Medicaid funding from the federal government,"

The Patrick Administration has promised it will not cut local aid or school funding this year, but Bissonnette is concerned that might happen.

What is helping to balance his budget is an estimated $450,000 from the local meals tax. The city has been receiving about $42,000 a month in the additional tax.

The city's budget is up from last year by $1.9 million and the mayor said $1.8 million of that sum is due to increases in health insurance costs, pensions and bonding. State pension reforms could save Chicopee about $400,000, he added.

The school budget has been increased about $5 million, but of that amount Chicopee is responsible for $75,000. The rest of the increase is paid for by the state and federal governments.

The new budget will affect property taxes and Bissonnette said the city is likely to go to the levy limit and seek an increase of 2.5 percent. However, he said, the need for an increase will be based on the level of revenues the city sees.

In a letter to the City Council Bissonnette wrote about the highlights of the new budget include:

"• Departmental budget requests have been reduced by over $500,000.

• Health insurance and other benefits have been held to a modest increase, which is below the state average.

• School nurses have been transferred to the school budget, resulting in savings of almost $200,000 in total costs.

• Position of City Solicitor has been upgraded to a full time position.

• No pay raises are included for the various union contracts, which expire on June 30, 2010.

• There are no anticipated layoffs or reductions in services in the budget as it currently stands.

• It is expected that use of approximately $2 million from our stabilization fund will be needed again to offset the reductions in local aid.

• There will be no Prop 2 1/2 override.

• The additional pay adjustments for elected officials as proposed by the Salary Committee for FY 2010 and FY 2011will again be postponed."

The City Council will begin conducting hearings with department heads this week to assess the budget.