FY15 Mayor's budget presentation — File 197108

Somerville Budget Overview Mayor Joseph A. Curtatone June, 2014 F Y 1 5

Investing in Somerville

Investing in our Schools and Neighborhoods Making the City Safer Through Strategic Enhancements Investing Today with an Eye on Tomorrow Improving Inspections and Review By Adding Resources at ISD

A Budget Guided by Our Core Principles and the Community’s Orienting Values Raise a Family Work Live Somerville: A Great Place to: Play

FY2015 Appropriations • Proposed Operating Budget = $203.1 Million • General Fund Appropriation = $188.0 Million • Municipal Appropriation = 3.8% increase over FY2014

General Fund Expenditures General Government 8% Public Safety 19% Culture and Recreation 1% Public Works 11% Pension and Fringe 17% Debt Service 5% Other 1% School Department 30% Overlay Reserve 1% State Assessments 7% FY15 Expenditures

Appropriations Overview $- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 Millions

$- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 Millions Values Driven Budget Continued investment in our schools: 6.6% increase in funding over FY14.

$- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 Millions Sound Fiscal Management Keeping our commitment to fully fund our Pension by 2035.

Significant Requests $- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 Millions

GIC was the prudent choice Self-Insured GIC 8.50% 15.50% 8.70% 1.43% 3.50% 1% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 Average Health Insurance Premium Increase from Previous Year

SMART CHOICES ARE PAYING DIVIDENDS Our highest bond rating ever A growing commercial tax base Continually Improving City Services

Highest Bond Rating Ever 2004 2014 A+ AA+ S&P 2004 2014 A2 Aa2 Moody’s Ratings guarantee savings for Somerville

Highest Bond Rating Ever “Budgetary performance has been strong” “Good financial practices” “Strong and growing economy”

Other Budget Accolades GFOA Distinguished Budget Presentation Award for FY14 Budget Certificate of Achievement for Excellence in Financial Reporting for FY13 CAFR

Our Past Investments are Paying Off… Assembly Row Projecting $4M in new growth property tax revenue ($2.4m from Assembly Row)* + $1M in new building permit revenue from blocks 5 & 6 *DIF taxes; $1.4m net after debt service $101m projected in captured increment tax dollars over 30 years from the DIF blocks 1,3, and 4 ($60 m net after debt service)

$1.31M $3.17M $1.65M $3.45M 0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 4,000,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Annual New Growth – FY2003 through FY2014 Most New Growth in a Decade

The only significant fee change will be to increase the Building Permit fee. This growth allows us to continue to invest without raising fees and fines. $19 per $1,000 construction cost $20 per $1,000 construction costs over $100K

We’re holding taxes low The Somerville fiscal year 2014 residential exemption is $1,907.53. $1,545 $2,561 $3,156 $4,801 $5,193 $6,220 $6,852 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 FY14 tax with exemption on $400k home Residential exemption No residential exemption

Tax on $400k Property w/ Residential Exemption $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 FY12 FY13 FY14 Lynn Medford Somerville

Hearing TODAY on raising Residential Exemption from 30% to 35% 30% ResX $4,794 35% ResX $4,639 Average Tax Bill for Two-Family Property in Somerville Savings of $155 annually

One of the largest Declines in Property Taxes -9.6% -9.3% -7.5% -5.3% -4.5% -0.9% -0.9% -0.1% 0.2% 1.2% 1.3% 1.3% 1.5% 1.9% 2.9% 5.2% -12.0% -10.0% -8.0% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% Percent change in tax on $400k property with residential exemption, FY13-FY14 Residential exemption No residential exemption

We’re holding taxes low: Commercial Rate $11.91 $13.50 $13.79 $18.50 $18.51 $20.44 $21.51 $24.01 $25.58 $25.62 $27.96 $31.18 $31.55 $34.81 $36.04 $40.95 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 FY14 commercial tax rate

$76m $34m $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 $80,000,000 $90,000,000 54% drop in state aid between FY2000 & FY2013* *adjusting for inflation

$41.6 M in State Aid cut since 2000* Taxpayers Pick up the Burden 43% 64% 0% 10% 20% 30% 40% 50% 60% 70% 2002 2014 Percent of Budget Covered by Tax Revenue = *adjusting for inflation

Some of the Lowest Spending Per Capita $2,224 $2,246 $2,383 $2,418 $2,663 $2,684 $2,717 $2,726 $3,245 $3,392 $3,574 $3,795 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 FY13 general fund spending per capita

Somerville: $2,383 Spending per Capita (General Fund FY13) Cambridge: $3,795 htt // /d /d /dl / d t f/ i i l t l dit / f d 13 l Boston: $3,574

Since 2000, 220 Mass. Communities have requested 1,423 overrides

Somerville = 0 Belmont = 3 Arlington=2 Brookline= 1 Newton=3

Growing Somerville’s Free Cash $- $2 $4 $6 $8 $10 $12 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Millions Free Cash as of July 1 $5.8M $10.6M

Expanding Our Stabilization Funds $- $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 $16,000,000 Growth in Stabilization Funds $0.2m $12.4m

Finding Cost Savings Everywhere • Streetlights have saved more than $600k over the past 2 Years • Correcting a glitch in the Ch. 90 formula will mean more money for street repairs • E-payables generated over $70,000 – as well as reduced paper • Lower debt costs from bond rating increases

Innovations in Service, for example… Parkmobile • Enhance current parking meters with pay-by-cell technology. Data Dashboard • Done in-house • Accessed by thousands

Somerville is thriving because we invest, for the long-haul, in our orienting values Make Somerville a Great Place to Live, Work, Play and Raise a Family WORK LIVE PLAY FAMILY

Local Meals Excise Tax Revenue is Up 15% Local Room Excise Tax revenue is Up 4.6% Photo by Chris Devers $0 $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 $1,600,000

119 net new small businesses in 4.1 square miles since 2010 As of 2014 Businesses are choosing Somerville

Our reputation for good management and innovation is growing • “Best Run City in the Commonwealth” – Boston Globe Magazine • All-America City 1972, 2009 • 100 Best Communities for Young People – 2008, 2009, 2010, 2011 • Green Communities Award 2011 • E-Government Award 2007- 2011 • U.S. HHS Let’s Move Award – 2011

Our Quality of Life is Gaining Notice • 9th Most Bikeable City in USA • 7th Most Walkable City – walkscore.com • Healthiest City in Massachusetts 2010 – MA Health Council • One of 14 best places to live in MA – Boston Magazine • “One of the 27 Coolest Suburbs” – Travel & Leisure • “Best Place to Date a Nerd” – Match.com

Listening to the Public: Community Budgeting Residents outlined their broad values in SomerVision. At 3 Community Budgeting sessions residents shared over 200 ideas about investments they want made in those values. We can make smarter investments knowing what the community wants.

Investing in Somerville Talent Redesigning Compensation • Competitive pay scales that will attract and retain qualified workers Promoting Transparency • New framework for annual evaluations • Tying salary increases to performance

Investing in Somerville Talent New Collective Bargaining Agreements Settled • School Custodians • Crossing Guards

Investing in the Next Generation

Listening to Residents *Residents consistently rank schools as a top priority. Their perception of the schools is highly predictive of their satisfaction with the City. *Source: Happiness Survey

Enrollment Projected to Rise 4,877 students total

A Historic Investment in Our Schools: a 26% increase since FY10 $- $10 $20 $30 $40 $50 $60 $70 FY10 FY11 FY12 FY13 FY14 FY15 Millions SPS Budget 6.6% Increase

Expanding Early Education • New SPS/Head Start classroom partnership at Healey School • Developing innovative early childhood network with Tufts-STELLAR program • Recruiting new early education director

Investing in Diversity • Additional reading support for Argenziano and Healey schools • New ELL program liaison • Expanding special needs teaching staff

Investing in Safety

Making the City Safer • FIRE – Fire Protection Engineer – new civilian position will allow us to move firefighter back into suppression unit from prevention unit • Police – Senior IT Specialist • K9 unit – last dog was retired due to promotion of his keeper • $50K for additional pavement markings – complete streets/public safety

Investing in Community

Keeping our youth healthy and active: Investing in Recreation 0 10 20 30 40 50 60 70 80 90 100 2009 2014 Youth Programming Over 45 programs added since 2009: Ĺ

Continuing to Improve Customer Service in ISD • Senior Code Enforcement Inspector (food safety) • Plumbing & Gas fitting inspector • Zoning Review Planner (ISD/Planning & Zoning liaison) • Paralegal • Additional Prof. & Tech. investments in Food Safety and Emergency Preparedness

Community Preservation Act Open Space & Outdoor Recreation Affordable Housing Historic Preservation

$1.3M from FY14 surcharge $1.3M from FY15 surcharge Designated City funds $300k to $1.25M from state match* At least $2.9M Expected Benefits FY15 *The state will match both surcharge funds and designated City funds.

Investing in Somerville health schools people parks

Make Somerville a Great Place to Live, Work, Play and Raise a Family WORK LIVE PLAY FAMILY WORK