Marblehead receives early Christmas gift, no $1.8M budget deficit for FY’09

MARBLEHEAD-The long-feared $1.8 million budget deficit that town officials predicted for Fiscal Year 2009 vanished Tuesday evening, just in time for Christmas.Town Administrator Tony Sasso and Finance Director John McGinn told town officials that a level-funded $57.79 million budget for Fiscal 2009, including an additional $880,473 for health insurance and $1.33 million for contract-related wage increases, is just $12,000 less than the town’s anticipated $57.8 million in revenues.In fact, the schools will get the money they need to add two Grade 4 teachers and a back-up educator to handle the influx of fourth graders from the town’s charter school.Sasso said the deficit evaporated with the decrease in local charter school students from 190 to 110, an $892,000 increase in free cash and the pay-off of a health insurance deficit.The Fiscal 2009 budget outlook report noted that this is the third year in a row that Marblehead has begun its budget deliberations in the black.In fact, the town ended Fiscal 2007 with a $125,000 surplus in the medical claims fund, a significant change from a $1.9 million deficit in that account two years ago. Part of that relief came from employees moving to HMO coverage.”What a reversal of fortune,” said Selectman William Woodfin, calling for Gov. Deval Patrick to provide cities and towns with some financial relief.McGinn noted that the town isn’t out of the woods yet, since the town doesn’t have enough of a financial cushion to guarantee stability next year.Those figures offset problems elsewhere. Projected new real estate growth is $375,000, down from last year. Auto excise tax collections were down $100,000. Building Permit revenue dropped by $178,000. Lottery aid receipts are down statewide and Medicaid reimbursement revenue may decrease when new regulations are approved.The town is close to spending its $100,000 snow removal account this month and McGinn anticipates a $220,000 deficit.