SAUGUS — The Board of Selectmen Tuesday voted to approve a $133 million operating budget for fiscal year 2025 recommended by Town Manager Scott Crabtree, moving the document to the Finance Committee for review.
The $133 million figure includes a $15 million allocation for the water and sewer enterprise funds, meaning the total estimated spending for the coming fiscal year, which begins on July 1, is $118 million. Of the $118 million, which Crabtree stressed is just an estimation of spending set to change based on insurance charges and other fixed expenses, a proposed $33.1 million will go to the school department, a $1.5 million increase over the department’s fiscal year 2024 allocation but a $1.2 million decrease from the budget approved by the School Committee last month.
In FY24, Crabtree initially presented a $110.5 million budget to the board for review, but the document was trimmed down to $107.5 million when it was recommended by the Finance Committee to Town Meeting, highlighting the fluid nature of municipal budgeting.
In his budget letter to Selectmen, dated Feb. 15, Crabtree pointed to a number of difficulties in preparing estimated expenses, including a lack of finalized health insurance rates, increases in trash hauling and incineration rates, and not-yet final enrollment numbers at Northeast Metropolitan Regional Vocational and Essex North Shore Agricultural & Technical Schools. The town is responsible for paying an assessment based on the number of students it sends to both of those schools, though Crabtree said the number of Saugus students attending the Voke, in Wakefield, has declined in recent years.
With regard to trash disposal costs, the Board of Selectmen approved a Host Community Agreement with WIN Waste Innovations last April that would provide the Town with free disposal – currently valued at $900,000 per year – if the company obtains permits to continue operating the ash monofill adjacent to the waste-to-energy facility.
Saugus is also responsible for a nearly $500,000 debt service payment for the Voke school building project, which is being funded by each of the communities served by the school. Crabtree, in the letter, said a new school with updated facilities and services could lead to increased charges for Saugus down the line.
Crabtree also pointed to the town’s pension appropriation of $5.6 million, a decrease from the FY24 appropriation as a result of an updated funding schedule voted by the town’s Retirement Board that extends payments into fiscal year 2028. The budget proposes allocating the difference between the projected FY25 appropriation and the new, lowered charge to the town’s Other Post Employment Benefits Trust Fund, which will go toward reducing the amount of unfunded liability carried by the town in its pension system. Crabtree said doing so would help the town maintain its AA+ bond rating.
The bond rating, and Crabtree’s conservative budgeting, were major talking points throughout the meeting, with the town manager drawing a contrast between his financial management strategy and that of previous administrations. Crabtree has earned plaudits from Selectmen for his work managing the town’s budget, and he said his administration aims to present a balanced budget to Town Meeting each year, with additional expenditures to be added down the road.
“What used to happen… was you’d have an unbalanced budget where everybody gets whatever they want and then you’d have to come to Town Meeting to make cuts and everybody would fight with each other, reducing the budget, rather than going with conservative estimates,” he said.
Crabtree credited that philosophy with guiding the town through the COVID-19 pandemic with no layoffs and the town never requesting an override of Proposition 2 ½ to bring in additional tax revenue.
At one point, he said the town spends within its means and the school department needed to learn from the strategies employed on the municipal side. Crabtree particularly pointed to grant-funded positions in the schools that are transitioning into the operating budget, criticizing the district for using one-time funds for operations.
“We get grants that supplement what we’re trying to do. We’re not going to get a grant to pay for positions that aren’t sustainable,” he said. “We don’t live off of grants, we look at grants, for projects and things that are based on our needs, so that we can then use that as a bonus to save the taxpayer money.”
During the meeting, the board went through each department included in the budget individually, peppering Crabtree and Treasurer/Collector Wendy Hatch with questions about departmental increases and vacant positions. Selectmen asked for no significant changes to the document, only seeking clarifications throughout the hearing.
Hatch walked the board through the sources of funding for the budget, explaining that the town’s tax levy, the primary source of revenue for any municipality, is set to rise by slightly more than $2 million for the coming fiscal year, bringing the total north of $82 million. Without final new growth numbers to confirm the total tax revenue, Hatch said the town budgets around $500,000 in new growth as a conservative measure.
Beyond that, the town uses state aid and local receipts, like money brought in through motor vehicle excise taxes, to fund its budget each year.
The board ultimately voted unanimously to approve the document as recommended by Crabtree, enabling the Finance Committee to begin its annual budget review process ahead of Town Meeting in May.
