Outgoing administrator warns Marblehead on spending

MARBLEHEAD – Scheduled to retire this year, Town Administrator Tony Sasso has started planning his last town budget in the black – but he let the department heads and town officials at Thursday?s State of the Town meeting know that he?s cautiously looking at least two years ahead when it comes to spending.Sasso and Finance Director John McGinn are anticipating an estimated $66.2 million in “level-service” spending for Fiscal 2013, including a $62.7 million town budget, a $2 million charter school assessment to cover 185 students and $1.8 million for state charges, tax abatements and a possible snow and ice deficit.They are expecting $66.4 million in revenue, including $50.5 million in taxes, and their budget is based on a projected 4 percent decrease in state aid, 6 percent decrease in local receipts (motor vehicle excise taxes and other local fees) and a 12 percent increase in health insurance premiums.While the Fiscal 2012 budget covers all existing employee contracts, Sasso noted that those contracts expire next summer, just before the beginning of Fiscal 2013.?If we weren?t conservative enough in our projections, we reserve the right to open up the budgets and make reductions so we can come to Town Meeting with a balanced budget,” Sasso told the selectmen, who host the annual State of the Town reports.On the plus side, Sasso pointed out that the town?s change from self-funded health insurance to Massachusetts Interlocal Insurance Association insurance has saved the town an estimated $12.1 million over the past five years. “Town employees have been a key part of this process,” Sasso said, noting that the change came about through collective bargaining.McGinn noted that Free Cash this year amounts to about $6 million, an 18-year high.”The Free Cash number will not repeat itself,” Sasso said. “When we work on the budget we work on a three-year basis. In Fiscal Year 2014 we?ll be dealing with a more realistic number.”That caution seemed to overshadow Sasso?s and McGinn?s thinking in other areas of the budget as well. “If the Legislature level funds state aid (an estimated $250,000 increase) we should set (that) money aside for Fiscal Year 2014,” Sasso said.