I am projecting a total revenue stream of $76,449,525 in Fiscal Year 2004. The bulk of this revenue is derived from three sources; $41,483,239 by way of using the full tax levy capacity of the Town; $600,000 in projected new growth and $3,781,452 in exempted tax levy to fund that portion of the debt service associated with the Floral Street School, High School Land Purchase, Open Space Land Purchase Projects, new High School Project, former High School Renovation Project and Allen property purchase. Based on use of the full levy, I project a Fiscal Year 2005 tax rate of $10.30 per thousand up from the current rate for Fiscal Year 2004 of $9.92. The tax rate increase will be moderated by any additional non tax levy funding, increased new growth, reductions in the levels of spending and changes in the assessed values of all real and personal property.

As stated above, I have level funded State Aid but I do note planned receipt in Fiscal Year 2004 of our first SBAB payment for the High School Project totaling $3,201,772. Total SBAB payments for Fiscal Year 2005 may be further increased if the Commonwealth pays out the newly adjusted payment for the Floral Street School of $585,681 which is the result of the recently completed audit. The current Floral Street School SBAB payment is $496,000.

I am recommending the use of $3,000,000 in Free Cash to fund various accounts and for reduction of the tax levy to meet the constraints of “Prop 2 ½”. For the past few years, the Board of Selectmen and Finance Committee with the support of Town Meeting has been very careful to marshal resources to guard against an economic downturn. The time is now appropriate to use these funds for their intended purposes to protect the service levels enjoyed by our residents.

I am projecting a very small increase in Schedule A Receipts based upon the current returns we are seeing. I will continue to monitor the current year’s receipts and make necessary adjustments as we approach Town Meeting.

I am also proposing the use of $735,000 from the Stabilization Fund to cover the costs associated with design development for the Fire Headquarters and Sherwood Middle School Projects. I also propose using $250,000 from the special fund account for coal ash revenues to partially offset significant increases in solid waste collection and disposal costs.

The balance of revenue reflects transfers to cover expenses associated with the sewer, light and CATV operations of the Town.

Fiscal Year 2005 will see a slight reduction in debt service expenses. There are still three projects that have not been permanently financed that will be added to the Town’s issued debt schedule in the form of the High School Renovation project ($19.6 Million), the North Shore School Addition ($1.3 Million) and the Allen property purchase ($6.1 Million). Each of these projects are being funded via the issuance of temporary financing in the form of Bond Anticipation Notes (BAN’s).

A more detailed explanation of the current debt service position of the Town is shown in Figure Six (attached) and within the Debt Service Budgets (Departments 0710, 0751 & 0752).