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Town Budget

Fiscal Year 2022 Town of Danvers, Massachusetts

Town of Danvers Select Board

Daniel C. Bennett, Chairman | Maureen A. Bernard | William H. Clark, Jr. | David A. Mills | Gardner S. Trask III

1 Sylvan Street, Danvers, Massachusetts 01923 | p: 978-777-0001 | f. 978-777-1025 www.danversma.gov

April 1, 2021

C.R. Lyons, Chairman Finance Committee Danvers, MA 01923

Dear C.R.:

Please find enclosed the Select Board’s proposed Fiscal Year 2022 Budget. This document adheres to the comprehensive Budget Policy, as adopted by our Board on December 15, 2020, and reflects the continuing efforts of the Board, Town Manager, and staff to maintain the high‐quality and cost‐ effective services that the citizens of Danvers have come to expect. This year’s budget focuses on several key areas, including: maintaining level services despite the ongoing public health crisis; reorganizing several departments based on retirements and restructuring; and a reduction in the use of one‐time revenue. In addition, the budget absorbs several fixed cost increases, most notable our assessments for pension ($536,317) and Essex Tech ($418,845).

As you know, the current COVID‐19 crisis continues to impact the community. It also has put a strain on our financial resources for FY2022, much as it did in FY2021. While State Aid shows a modest increase from the prior year, we are still facing uncertainty with regard to several local receipt categories. Despite the uncertainty, we believe the end result is a budget that maintains the core services we provide to the citizens of Danvers, despite the prolonged pandemic. The General Government, Education, and Library budgets are projected to increase by 2.38%, 2.69%, and 2.12% respectively. All three functional areas have collaborated to produce conservative budgets during these uncertain times, with the combined increase at 2.55%. The FY2022 budget also requires a 53rd week of payroll, without which the overall increase would be a combined 2.08%. Although we are truly in an unprecedented fiscal period, the operating budgets for General Government, Education, and Library are in line with our policy objectives. They also comply with the Financial Policies (on the Town’s website and in the Supplemental Section of the budget book) adopted by the Board in March 2016. We are projecting that the proposed Town budget will result in an overall tax levy which will be at or near our tax levy limit but will not necessitate the use of a Proposition 2½ budget override or debt exclusion.

Proposed warrant articles are another area of potential impact on the budget. Warrant articles will once again receive scrutiny by the Board and Town Manager. As always, we will prioritize requests and recommend warrant expenditures that we believe to be in the best interests of the Town of Danvers. Warrant articles also will factor in a need to maintain a higher level of Free Cash than usual in order to guard against a lower Free Cash number next year eroded by the drop in local

C.R. Lyons, Chairman

April 1, 2021 Page 2 receipt revenue. Despite our ongoing fiscal difficulties, we feel confident that this budget, as presented, will enable Town government to provide the essential services that our citizens expect and deserve. The Select Board conducted their annual budget workshop and received input from staff, the School Department, Essex Tech, and the Library Director. After careful consideration, the Board voted on March 13, 2021 to adopt this budget and pass it on to the Finance Committee. The Board remains committed to the timely provision of all available support information that is requested to assist you in your deliberations. We look forward to hearing Finance Committee input and recommendations during your review of this budget beginning on April 12, 2021.

Sincerely,

Chairman

PAGE

i Budget Overview by Town Manager

PAGE

1 Budget Policy

3 Budget Process & Schedule

4 Budget Summary

5 Revenue and Expenditure ‐ History and Forecast

7 Financing Sources

19 Reserves

20 Education Cost Breakout

21 Table of Appropriations

PAGE PAGE

23 Moderator / Select Board / FinCom / Legal 45 Public Works ‐ Tax Supported

25 Management 49 Sewer Division

27 Information Technology 53 Water Division

29 Department Heads 56 Electric Division

31 Accounting 67 Land Use & Community Services

33 Assessing 79 Recreation

35 Treasurer/Collector 81 Peabody Institute Library

37 Human Resources 83 Debt Service

39 Town Clerk 85 Employee Benefits

41 Police Department 87 Retirement

43 Fire Department

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90 Capital Improvement Plan Overview by Town Manager

91 Capital Plan Recommendations

92 Project List and Funding Summary

96 Project Descriptions

103 Capital Improvement Plan FY2022‐FY2026

105 5‐Year Funding Plan

106 Capital Plan Policy

PAGE

108 Community at a Glance

110 Organizational Chart

111 Town Employment by Department

112 Performance Metrics

120 Financial Policies

127 Credit Rating Report

135 Basis of Accounting & Budgeting

136 Fund Descriptions

140 Danvers Public Schools Summary

144 Support Services Charges

145 Glossary of Municipal Finance Terms

SUPPLEMENTAL INFORMATION

CAPITAL IMPROVEMENT PLAN

FISCAL YEAR 2022 BUDGET

TABLE OF CONTENTS

FINANCIAL SUMMARIES

DEPARTMENTAL DETAILS

Town of Danvers Office of the Town Manager

Steve Bartha | Town Manager 1 Sylvan Street, Danvers, Massachusetts 01923 | p: 978-777-0001 | f. 978-777-1025 www.danversma.gov | [email protected]

M e m o r a n d u m

To: Danvers Select Board

From: Steve Bartha, Town Manager

Date: March 1, 2021

Subject: Proposed budget for Fiscal Year 2022

I am pleased to submit to you a balanced and comprehensive Town budget for the fiscal year beginning July 1, 2021. Expenditure and revenue estimates are based on the best available information and are subject to possible variations between now and the time the tax rate is set in the fall, including uncertainty over final State Aid and State Assessment figures on the State’s Cherry Sheet, as well as the outcome of property tax‐supported warrant articles that may be approved at the Annual Town Meeting.

Overview

Around this time last year, staff was preparing to present a balanced budget proposal that was built on conservative estimates, addressed current and long‐term challenges, further fortified the Town’s financial position, all while maintaining the quality services our residents deserve and expect. In the blink of an eye, the COVID‐19 pandemic was impacting our lives in ways unimaginable, including necessitating a complete overhaul of the fiscal year 2021 budget.

The fiscal year 2021 budget went through several iterations, with revenue sources being adjusted right up until the tax rate was set in December. Although we had the benefit of starting the fiscal year 2022 budget process with a better understanding of the pandemic’s economic impact, much of the same uncertainty remains. Local Receipts continue to be a category of concern, particularly the deterioration of Motor Vehicle, Rooms, and Meals excise taxes. It would appear all three have stabilized, but as the Great Recession showed us more than a decade ago, the aftershock of such events can last for several budget cycles.

On the expense side, departmental budget requests were the leanest I can recall in the six‐plus years I have been in Danvers. Much of the overall increase is driven by familiar budget drivers, such as assessments (PERAC and Essex Tech) as well as the fact that fiscal year 2022 includes a 53rd pay period. As you may recall, we had hoped to convert to properly accrued payroll last year to avoid the periodic 53‐week scenario; however, this best practice was deferred as one of many cuts to the final budget and will be revisited in a future year. We also must be prepared to absorb COVID‐related costs, if need be, in this budget. While Federal and State Aid related to the pandemic has helped, there are currently both time limits and funding constraints on these resources. We should be able to continue to seek reimbursement for these costs, but it is a potential expense to keep in mind, nonetheless.

In terms of the budget document itself, several enhancements and additions were incorporated last year to both increase the Town’s financial transparency as well as lay the groundwork for GFOA budget award consideration – a distinction currently held by less than 10% of municipalities in the Commonwealth. The highlights included an expanded capital plan section more in line with peer communities and a financing sources section that better describes the Town’s revenue sources and their recent trends. New

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in fiscal year 2022 for the printed version, the department section will be presented in landscape for easier reading of the line item details. Lastly, the performance measurement section in the supplemental section of the budget is included again to provide data to support the claim that Danvers continues to provide high quality services as efficiently as possible to residents and businesses.

The budget summary tables attached to this document will provide you with an overall view of the proposed budget.

Budget Drivers

Budget drivers on the expense side are a combination of anticipated fixed costs as well as unanticipated and/or one‐time costs. The actuarially calculated increase to the Danvers Retirement System is 7.49% (+$536,317). Education costs for Danvers Public Schools represent a 2.69% (+$1.17 million) increase, driven primarily on potential contractual agreements and the continued absorption of last year’s additional special education costs. The Essex Tech assessment, proposed annually as a warrant article but funded through the tax levy, is projected to increase 14.05% (+$418,845) – the second consecutive double‐digit rate increase – driven largely by admissions of Danvers students at what appears to be a rate higher than other member communities. The Benefits & Insurance budget, normally another budget driver, is projected to increase by only 0.11% (+$15,641); this is a below‐trend increase based on several factors, including a potential premium holiday from our carrier, the introduction of both a high deductible plan design option and an opt out incentive program for employees, and a manageable 2.9% increase on our active plans. Lastly, the budget contains funding for a 53rd week of payroll. The Town has historically budgeted based on the number of “paydays” (Thursdays) each year. In fiscal year 2022, there will be one extra (53 v. 52) such day, resulting in a roughly 2% increase in personnel line items.

On the revenue side, the Proposition 2½ levy capacity is increasing by $2.1 million, plus projected New Growth of $600,000. Non‐enterprise fund Local Receipts are growing by 4.54% (+499,528) driven mostly by the phased in update of the Electric PILOT formula (last adjusted in 1995) as well as the expectation of a modest rebound in certain categories impacted by the pandemic. Other funding sources include State Aid, Free Cash to support Capital Outlay, Debt Stabilization to support school related debt, and Overlay Surplus.

Through careful planning, sound financial policies, and long‐standing conservatism with respect to financial management, the budget team was able to account for these drivers within the available revenue sources to present a balanced budget for fiscal year 2022.

Positive fiscal year 2020 results show proof of the effectiveness of these strategies despite the pandemic reducing revenue in the fourth quarter. The Town received a favorable Free Cash certification of $5.6 million in January, which allowed progress to be made on several key financial goals, including Town Meeting recommendations to replenish $1.5 million in the Debt Stabilization Fund, to increase the annual OPEB Trust appropriation by $50,000, consistent with our adopted funding plan, and reserving $500,000 from this year’s certification to ensure that the fiscal year 2023 OPEB funding obligation can be met.

Expenditures

Proposed operating budgets in Education, General Government, and Library are projected to increase by 2.69%, 2.38%, and 2.12%, respectively. Collectively, this represents a 2.55% increase over FY2021. However, it is worth noting that approximately $357,000 of this is directly related to the cost of funding the 53rd week of payroll. Without this one‐time expense, the actual increase in Education, General Government, and Library is a combined 2.08%.

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Debt service payments for long‐term borrowing are projected to increase by $18,557, or 0.28%, in fiscal year 2022. This figure includes short‐term interest on additional funding for the Smith School project. Debt costs will increase in future years as these costs are permanently financed.

The General Fund pension assessment paid to the Danvers Retirement System will increase by $536,317, or 7.49%, based on the January 1, 2020 valuation report. The system‐wide Retirement Budget (including enterprise) is increasing by $772,588, or 9.39%. Part of the increase is attributed to the valuation plan to maintain the Electric division’s fully funded status long‐term by continuing to fund any delta within each two‐year valuation.

The Benefits budget shows a projected increase for active and retired employees of $15,641, or 0.11%, which is the result of the continued success of the Town’s changed carrier and cost model, as well as a potential premium holiday that will benefit both taxpayers and employees.

The preliminary fiscal year 2022 assessment from Essex Tech is up $418,845, or 14.05% (the fiscal year 2021 assessment was 25% higher than fiscal year 2020). As noted above, this increase is driven primarily by the continued growth in enrollment (as a percent of student body) for Danvers: in 2017, Danvers represented 12% of the student body, in 2021, it will be 17%. As a community, Danvers comprises only 9% of the population across member districts. This continues to be a concerning trend that could result in long‐term budget instability if not addressed. The Town continues to work with Essex Tech officials and fellow sending communities on establishing some form of stability regarding annual enrollment figures.

Capital Outlay, funded again through Free Cash, is up $131,872, or 18.29%. This number is in line with recent years and features critical investments in equipment for public works, public safety, schools, and recreation. The long‐term goal continues to be to move the majority of these annual capital expenses into the tax levy to reduce dependence on generating Free Cash, a more volatile funding source.

Revenues

An additional $600,000 in tax revenue (new growth) is projected in fiscal year 2022, based on year‐to‐date construction estimates; this conservative projection is lower than our three‐year average ($868,206) but is in line with the “low water mark” of $629,466 in growth in fiscal year 2016.

The proposed fiscal year 2022 tax levy reflects an increase of approximately 3.27% (including new growth) above the current year; as in years past, the level‐service operating budget requires the utilization of almost all of the Town’s levy capacity under Proposition 2½, but no overrides or debt exclusions.

State Aid, under the Governor’s proposed budget, would increase by a net $228,649, or 2.14%. The two major State Aid categories, Chapter 70 aid for education and Unrestricted General Government Aid (UGGA), are up 1.43% and 3.50% respectively.

Per Town policy, the Electric, Water, and Sewer Divisions remain fully self‐supporting.

Based upon actual fiscal year 2020 results and year‐to‐date (fiscal year 2021) receipts, the proposed budget is projecting Local Receipts very conservatively. The total increase of $499,528, or 4.54%, is driven primarily by revised PILOT payment figures. Any increases to other categories are minimal and the total estimate is $1.77 million less than pre‐pandemic actuals.

Consistent with past practice, the proposed budget includes the use of Free Cash to fund Capital Outlay. Our Certified Free Cash number from July 1, 2020 was $5.6 million. Based on our Financial Reserve Policy, the use of Free Cash, beyond capital outlay, should be managed to preserve at least one percent (1%) of the Net Operating Budget ($112 million).

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The proposed budget uses $1.86 million from the Debt Stabilization Fund (down from $2.35 million in fiscal year 2021) to offset peak debt service, particularly the Smith School project. A warrant article will recommend appropriating $1.50 million back into the Fund from available sources, resulting in a projected June 30, 2022 balance of $2.53 million. This net reduction aligns with continuing analysis on funding needed over the next several fiscal years to offset peak debt associated with major projects.

Budget Policy

The Budget Policy, approved by the Select Board in December of 2020, emphasizes customer service, quality of life, infrastructure, financial stability, and consistently excellent and cost‐effective public safety, land use, and community services. Working with senior staff from the three sectors of Town government (the budget team), the fiscal year 2022 process began in October and involved establishing overall budget objectives consistent with the Budget Policy, identifying ongoing or new fixed‐costs, and working within the limited revenue growth and reductions in available funds. Our unique and collaborative budget process results in a far greater understanding of the overall budget development landscape and the fiscal constraints we collectively face. As the budget process advances, the budget team will continue to meet to address local and state developments.

Financial Policies

In 2019, the Town received a AAA credit rating from Standard & Poor’s. The groundwork for this upgrade was laid in 2016, when the Select Board adopted financial policies in three key areas: Reserves, Fund Balance, and Debt. These policies were based on best practice, historic performance, and guidance from the Government Finance Officers Association (GFOA). The proposed budget is consistent with the Budget Policy and, based on current projections, in line with the adopted Financial Policies. Below is our most recent measurement for compliance:

General Government

The proposed General Government budget is consistent with the Budget Policy guidelines and long‐term goals, as well as ongoing strategies and objectives. Together, they include the following:

Continue to be a customer‐focused organization

Provide high quality and affordable recreation and cultural services and programs

Maintain and enhance community infrastructure and facilities

Ensure long‐term fiscal stability through effective strategies and policies

Institute innovative approaches to managing personnel and associated costs

Balance competing needs across all service areas

Financial Policy Source Measurable Comparison Actual % Compliance

Debt Service as % of Operating Budget (<10%)

FY21

Budget

$6.64M

$107.21M

6.19%

Yes

Unassigned Fund Balance as % of Net Operating Expenditures (8‐12%)

FY20 CAFR

$11.12M

$103.78M

10.71%

Yes

Total Fund Balance as % of Net Operating Expenditures (>15%)

FY20 CAFR

$21.54M

$103.78M

20.76%

Yes

Free Cash, after Appropriation, as % of Operating Budget (>1%)

FY21 Budget

$1.20M

$107.21M

1.12%

Yes

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As noted above, roughly $357,000 of the increase to the operating budget is related to the one‐time cost associated with a 53rd week of payroll. As in recent years, we continue to realign divisions and staff as vacancies occur to maximize efficiency and effectiveness. In fiscal year 2022, this includes splitting Administrative Services into the separate departments of Treasurer/Collector and Town Clerk as well as Health and Veterans’ Services into separate divisions. There are also changes in Planning and Inspectional Services that should make for more streamlined service delivery, while better aligning them under the Land Use and Community Services umbrella.

Overall, the proposed General Government budgets reflect an attempt to maintain level‐service across the various divisions and ensure service level solvency moving forward, despite the ongoing pandemic and budgetary headwinds and drivers that far exceed the Prop 2½ constraints or the ability of non‐tax revenue to keep pace.

Budget Reductions / Alternatives

Meeting our budget objectives required reductions in capital equipment, operating expenses, and personnel requests, and it is possible that further modifications to the proposed fiscal year 2022 budget may be required between now and the May Town Meeting, as cost projections and revenue estimates are further refined, and as we await Federal and/or State developments around pandemic relief. Although these adjustments may result in changes to the way in which services are delivered, they should not result in the reduction of essential public services. Staff remains fully committed to living within very tight budget constraints, but in ways that do not sacrifice the quality of the core services provided to the residents of Danvers. The Town will continue to explore creative ways to control costs to Danvers taxpayers and ratepayers, such as fee‐for‐service concepts, developing zoning updates to stimulate appropriate growth, and periodic review of program and service delivery methodology. Some of these proposals are being implemented while others require further study and discussion.

State Aid

As noted above, the Governor’s proposed budget provides for a 2.14% increase in State Aid. Most of this aid is reserved for education. It remains vitally important that our local officials and management team continue to work collaboratively with the Massachusetts Municipal Association and Massachusetts Association of School Committees to convey to our legislative representatives the need for (a) significant growth in State Aid that will begin to put us back on a more sustainable trajectory and (b) common‐sense mandate relief. Although a final State budget is unlikely to be signed into law until June, we are hopeful that a resolution vote on State Aid will be taken earlier to provide clarity on this important issue prior to the May Town Meeting.

Remaining Issues

We are currently preparing draft warrant article proposals for initial consideration by the Board in April. The extent to which these require property‐tax financing will be a key issue in our upcoming discussions. As noted above, we have assumed limited funding for tax‐supported warrant articles to help alleviate some of the pressures on the operating budgets. The adoption of additional tax financed proposals, such as citizen‐initiated petitions, could impact our Education, General Government, or Library operating budgets and require additional adjustments in the weeks and months ahead.

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Conclusion

Credit for this budget document belongs to the entire budget team. From the bottom‐line to individual line‐items, developing a balanced budget each year requires months of preparation and dedication by staff at many levels within the organization. Collectively, the Town, Schools, and Library worked together during what was – yet again – a challenging budget development process. We look forward to working with you in what we expect to be a rigorous, comprehensive, and socially distanced day of budget hearings on Saturday, March 13, beginning at 9:00 A.M., in the Holten Richmond Multi‐Purpose Room.

cc: Select Board Rodney Conley

Dr. Lisa Dana Jennifer McGeorge

Keith Taverna Department/Division Managers

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FINANCIAL SUMMARIES

Approved by Select Board ‐ December 15, 2020

TOWN OF DANVERS FISCAL YEAR 2022 BUDGET POLICY

MISSION

To provide excellent services, at the level desired by citizens, taxpayers, and ratepayers, that ensure the health, safety, education, welfare, and quality of life of the community.

LONG‐TERM GOALS

1. Be a customer‐focused organization committed to professional and friendly service delivery.

2. Provide high quality and affordable education, recreation, and cultural services and programs, for res‐ idents of all ages, in a caring and supportive learning environment with rigorous staff and facultystandards, sufficient resources, and well‐maintained facilities.

3. Maintain and enhance community infrastructure, capital equipment, and public facilities throughlong‐range capital planning and the prioritizing of projects, all within allowable fiscal constraints.

4. Ensure long‐term fiscal stability through professional management and appropriate policies. Imple‐ ment plans and strategies aimed to maintain a stable tax base, control costs, maintain adequate re‐ serves, and strengthen the Town’s financial position.

5. Provide cost effective and consistently excellent public safety, land use, and community services thatcreate a safe, secure, and pleasing environment where people can live, work, and play in harmonywith their surroundings.

ONGOING STRATEGIES

Coordinate: Town, Schools & Library – Collaborate with the School Department/Committee and Li‐ brary Staff/Trustees to deliver responsive and responsible budgets to the Finance Committee andTown Meeting that (a) effectively manage costs controlled by those elected bodies, (b) identify andcollectively address cost drivers that affect the entire organization, and (c) plan properly for futurecapital needs.

Balance Competing Needs – Provide affordable, quality services in education, library, public safety,public works, land use, and community services (recreation, health, senior, social, and veterans) with‐ out allowing any one service area to utilize a disproportionate amount of available resources. Trackdemographic trends to anticipate shifting service needs across the community. Continue to monitorand review all expenses associated with Town government to affirm that the most cost‐efficient andeffective systems are in place and work to find innovative methods to maintain service levels whilereducing costs. Maintain sustainability by matching recurring costs with recurring revenues.

Personnel – Institute innovative approaches to managing future personnel costs in the operatingbudget, including employee compensation, benefits, pension, and retiree healthcare costs. Recognizethe need to maintain an equitable approach to compensation for non‐union and union employees.

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TOWN OF DANVERS FISCAL YEAR 2022 BUDGET POLICY

Reserves & Debt – Maintain and strengthen the Town’s reserve position, while ensuring that reservelevels, debt service, and capital programs comply with adopted financial policies. Continue to fund theDebt Stabilization Fund to offset peak year debt service costs. Pursue grant opportunities andfundraising, where possible, to reduce debt costs.

Capital Improvement Plan – Continue to maintain and expand the comprehensive, five‐yearCapital Improvement Plan (CIP). Give special consideration to the long‐term impacts that capitalprojects may have on the operating budget or future CIP needs.

Revenue – Revenue diversification should be explored and expanded, including the creative use ofPILOTs, to broaden the revenue base, strengthen the Town’s tax levy capacity, and mitigate againstreductions in anticipated revenue sources. Work with State/Federal representatives and municipalorganizations to protect and enhance Local Aid and other sources of funding. Where possible, offerproperty tax abatement programs within fiscally responsible guidelines.

BUDGET CONFERENCE COMMITTEE [when and if necessary]

Nature & Scope: The Budget Conference Committee (or “BCC”) is a forum designed to assist the Select Board, School Committee, and Library Trustees in resolving budget‐related issues through negotiation and compro‐ mise prior to passage of each body’s final budget, particularly when preliminary budgets exceed the budget targets set forth by the Select Board. The budgets can then be put before respective, elected bodies for a final vote reflecting the consensus of the BCC.

Ground Rules: The BCC may be convened at the request of the Chair of the School Committee or Library Trus‐ tees by notifying the Chair of the Select Board (who may also call for the BCC), at which time a tentative meeting schedule will be established within required time frames, i.e. warrant posting, budget hearings, etc. The Finance Committee Chair, or designee, will be notified of any meetings of the BCC.

The BCC will meet in posted, public session at an appropriate time, mutually convenient to the public and BCC members, as often as needed and as long as there is substantive progress toward resolution of budget issues. The BCC shall consist of nine members: the three Chairs, one additional member from each of the three legis‐ lative bodies, and their respective chief executives. The Chairs, or their designees, will agree on the time/place for the first meeting and notify their respective attendees. The BCC will not vote on action taken, as consensus agreement is the objective.

Outcomes: If issue(s) resolved, agreement reached: ACTION: Chairs bring agreement to their respective Board/Committee for discussion and final budget vote. If approved, budget is sent to the Select Board.

If issue(s) not resolved: ACTION: The Board/Committee whose preliminary budget exceeds budget targets may choose to vote their final budget and refer it to the Select Board.

The Select Board will vote the final budget and, if necessary, adjust preliminary budgets in keeping with budget targets and policy.

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BUDGET PROCESS & SCHEDULE

The Town of Danvers is governed by Massachusetts General Law, Town by‐laws, the Town Manager Act, and other relevant statutes. Under the Town’s form of government, an elected, five‐member Select Board appoints a Town Manager to administer the daily operation of the Town. The Town’s legislative body is Representative Town Meeting. In accordance with Town by‐laws, the Town Manager must annually submit a balanced budget to the Select Board by March 1. The budget is reviewed by the Board before being moved to the Finance Committee by April 1. The Finance Committee reviews the annual operating budget and other warrant articles and submits their recommendations to Town Meeting. Town Meeting then votes to adopt the annual operating budget and other warrant articles at the Annual Town Meeting.

Fiscal Year 2022 Budget Schedule

Departmental budget requests reviewed November – December 2020

Budget Policy adopted by the Board of Selectman December 15, 2020

Budget Team (Town, Schools, Library) meeting January 12, 2021

Select Board Budget Review March 13, 2021

Select Board Warrant Review April 6, 2021

Finance Committee Hearings April 12, 13, 15 (TBD), 2021

Finance Committee Warrant Review April 26 & 27 (TBD), 2021

Annual Town Meeting May 17, 2021 at 7:30 pm (at DHS) * * (date, time, location subject to change)

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ACTUAL ACTUAL TAX RECAP BUDGET

2019 2020 2021 2022

REVENUE

PROPERTY TAX 78,154,410$ 80,988,716$ 83,946,463$ 86,688,223$

STATE AID (INCL. MSBA) 10,519,806$ 10,589,762$ 10,678,572$ 10,907,221$

LOCAL RECEIPTS 13,274,290$ 12,445,242$ 11,004,642$ 11,504,170$

OTHER AVAILABLE FUNDS 2,691,503$ 3,349,478$ 3,524,341$ 3,019,199$

SUBTOTAL 104,640,008$ 107,373,197$ 109,154,017$ 112,118,813$

ENTERPRISE FUNDS 13,536,038$ 13,311,527$ 14,694,826$ 14,987,628$

TOTAL REVENUE 118,176,046$ 120,684,725$ 123,848,844$ 127,106,441$

EXPENDITURES

EDUCATION 40,900,969$ 42,716,672$ 43,502,155$ 44,673,035$

LIBRARY 1,381,617$ 1,370,294$ 1,499,029$ 1,530,850$

GENERAL GOVERNMENT 27,251,708$ 27,499,620$ 30,702,518$ 31,433,104$

RETIREMENT 6,207,828$ 6,644,945$ 7,164,259$ 7,700,576$

UNAPPROPRIATED CHARGES 2,066,571$ 1,967,280$ 1,943,107$ 1,853,383$

GENERAL GOVERNMENT DEBT 6,002,641$ 6,578,078$ 6,640,432$ 6,658,989$

EMPLOYEE BENEFITS & INSURANCE 13,547,052$ 13,765,135$ 14,001,387$ 14,017,028$

CAPITAL OUTLAY (ALL DEPARTMENTS) 998,025$ 596,000$ 720,863$ 852,735$

ESSEX TECH WARRANT ARTICLE 2,364,063$ 2,502,731$ 2,980,268$ 3,399,113$

SUBTOTAL 100,720,474$ 103,640,755$ 109,154,018$ 112,118,813$

ENTERPRISE FUNDS 13,536,038$ 13,311,527$ 14,694,826$ 14,987,628$

TOTAL EXPENDITURES 114,256,532$ 116,952,282$ 123,848,843$ 127,106,441$

BUDGET SUMMARY FISCAL YEAR 2022

Education (DPS & Essex)43.60%

Library1.39%

General Govt28.51%

Retirement6.98%

Debt Service6.04%

Benefits & Insurance12.71%

Capital Outlay0.77%

EXPENDITURES BY CATEGORY FY2022

Property Tax77.32%

State Aid9.73%

Local Receipts10.26%

Other Available2.69%

REVENUE BY CATEGORY FY2022

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REVENUE ACTUAL ACTUAL TAX RECAP BUDGET

2019 2020 2021 2022

PROPERTY TAX LEVY 78,154,410$ 80,988,716$ 83,946,463$ 86,688,223$

STATE AID (INCL. MSBA) 10,519,806$ 10,589,762$ 10,678,572$ 10,907,221$

LOCAL RECEIPTS

Motor Vehicle Excise (MVE) 5,018,990$ 4,583,733$ 4,450,000$ 4,550,000$

Other Excise (Incl. Meals) 965,945$ 881,529$ 620,000$ 670,000$

Penalties & Interest 302,281$ 235,995$ 300,000$ 300,000$

Hotel/Motel Tax 1,684,366$ 1,390,646$ 915,000$ 800,000$

In Lieu of Taxes 1,235,208$ 1,224,087$ 1,363,000$ 1,649,178$

Other Charges for Services 1,007,911$ 1,165,177$ 1,162,301$ 1,217,962$

Fees 732,355$ 795,922$ 712,500$ 712,500$

Departmental 311,226$ 173,563$ 95,000$ 95,000$

Licenses & Permits 1,155,913$ 924,763$ 850,000$ 970,000$

Fines & Forfeits 53,546$ 43,835$ 50,000$ 50,000$

Investment Income 470,601$ 440,722$ 160,000$ 160,000$

Medicaid Reimbursement 312,986$ 200,242$ 200,000$ 200,000$

Misc recurring 22,961$ 122,053$ 126,841$ 129,530$

Misc non recurring ‐$ 262,975$ ‐$ ‐$

subtotal 13,274,290$ 12,445,242$ 11,004,642$ 11,504,170$

Enterprise Funds 13,536,038$ 13,311,527$ 14,694,826$ 14,987,628$

Local Receipt TOTAL 26,810,327$ 25,756,769$ 25,699,468$ 26,491,798$

OTHER AVAILABLE FUNDS

Free Cash 998,025$ 596,000$ 720,863$ 852,735$

Debt Stabilization 1,198,478$ 2,353,478$ 2,353,478$ 1,861,464$

Lat./Part. Sewers 60,000$ 20,000$ 20,000$ 20,000$

Slip Fees 35,000$ 35,000$ 35,000$ 35,000$

Parking Receipts ‐$ ‐$ 50,000$ 50,000$

Overlay Reserve 400,000$ 345,000$ 345,000$ 200,000$

subtotal 2,691,503$ 3,349,478$ 3,524,341$ 3,019,199$

TOTAL REVENUE 118,176,047$ 120,684,725$ 123,848,844$ 127,106,441$

EXPENDITURES ACTUAL ACTUAL TAX RECAP BUDGET

2019 2020 2021 2022

General Government 3,416,440$ 3,758,494$ 4,186,263$ 4,210,960$

Police 6,058,072$ 6,099,588$ 6,852,250$ 7,036,085$

Fire 5,131,356$ 5,156,025$ 5,325,594$ 5,658,881$

Education 40,900,969$ 42,716,672$ 43,502,155$ 44,673,035$

Public Works (tax) 10,272,698$ 10,028,966$ 11,541,399$ 11,617,289$

Land Use & Community Services 1,550,152$ 1,566,180$ 1,843,814$ 1,919,392$

Recreation 822,990$ 890,366$ 953,198$ 990,497$

Library 1,381,617$ 1,370,294$ 1,499,029$ 1,530,850$

Debt Service ‐ General Govt 6,002,641$ 6,578,078$ 6,640,432$ 6,658,989$

Retirement 6,207,828$ 6,644,945$ 7,164,259$ 7,700,576$

Employee Benefits/Insurance 13,547,052$ 13,765,135$ 14,001,387$ 14,017,028$

Capital Outlay (All Departments) 998,025$ 596,000$ 720,863$ 852,735$

Essex Tech Warrant Article 2,364,063$ 2,502,731$ 2,980,268$ 3,399,113$

subtotal 98,653,903$ 101,673,475$ 107,210,911$ 110,265,430$

Enterprise Funds 13,536,038$ 13,311,527$ 14,694,826$ 14,987,628$

Expenditure TOTAL 112,189,940$ 114,985,002$ 121,905,736$ 125,253,058$

OTHER AMOUNTS TO BE RAISED

Offsets 36,401$ 37,746$ 39,119$ 46,942$

State & County 1,186,910$ 1,252,808$ 1,235,335$ 1,206,441$

Overlay Reserves 843,260$ 676,726$ 668,653$ 600,000$

subtotal 2,066,571$ 1,967,280$ 1,943,107$ 1,853,383$

TOTAL TO BE RAISED 114,256,533$ 116,952,282$ 123,848,843$ 127,106,441$

REVENUE & EXPENDITURE DETAIL HISTORY

5

FY19 Actual FY20 Actual FY21 Recap FY22 Budget FY23 FY24 FY25 FY26Revenues Assumption

Tax Levy 78,154,410$ 80,988,716$ 83,946,463$ 86,688,223$ Calculated 89,455,429$ 92,291,814$ 95,199,110$ 98,179,087$

Prior Year Levy Limit 75,516,164$ 78,198,964$ 80,994,021$ 83,988,511$ Prior Year 86,688,223$ 89,455,429$ 92,291,814$ 95,199,110$

Prop 2 1/2 Increase 1,843,350$ 1,949,669$ 1,982,803$ 2,099,712$ 2.5% 2,167,206$ 2,236,386$ 2,307,295$ 2,379,978$

New Growth 794,896$ 840,083$ 969,639$ 600,000$ Level 600,000$ 600,000$ 600,000$ 600,000$

State Aid 10,519,806$ 10,589,762$ 10,678,572$ 10,907,221$ 2% 11,125,365$ 11,347,873$ 11,574,830$ 11,806,327$

Local Receipts 13,274,290$ 12,445,242$ 11,004,642$ 11,504,170$ 1% 11,619,212$ 11,735,404$ 11,852,758$ 11,971,285$

Motor Vehicle Excise (MVE) 5,018,990$ 4,583,733$ 4,450,000$ 4,550,000$ 1% 4,595,500$ 4,641,455$ 4,687,870$ 4,734,748$

Other Excise (Incl. Meals) 965,945$ 881,529$ 620,000$ 670,000$ 1% 676,700$ 683,467$ 690,302$ 697,205$

Penalities & Interest 302,281$ 235,995$ 300,000$ 300,000$ 1% 303,000$ 306,030$ 309,090$ 312,181$

Hotel/Motel Tax 1,684,366$ 1,390,646$ 915,000$ 800,000$ 1% 808,000$ 816,080$ 824,241$ 832,483$

In Lieu of Taxes 1,235,208$ 1,224,087$ 1,363,000$ 1,649,178$ 1% 1,665,670$ 1,682,326$ 1,699,150$ 1,716,141$

Other Charges for Services 1,007,911$ 1,165,177$ 1,162,301$ 1,217,962$ 1% 1,230,142$ 1,242,443$ 1,254,867$ 1,267,416$

Fees 732,355$ 795,922$ 712,500$ 712,500$ 1% 719,625$ 726,821$ 734,089$ 741,430$

Departmental 311,226$ 173,563$ 95,000$ 95,000$ 1% 95,950$ 96,910$ 97,879$ 98,857$

Licenses & Permits 1,155,913$ 924,763$ 850,000$ 970,000$ 1% 979,700$ 989,497$ 999,392$ 1,009,386$

Fines & Forfeits 53,546$ 43,835$ 50,000$ 50,000$ 1% 50,500$ 51,005$ 51,515$ 52,030$

Investment Income 470,601$ 440,722$ 160,000$ 160,000$ 1% 161,600$ 163,216$ 164,848$ 166,497$

Medicaid Reimbursement 312,986$ 200,242$ 200,000$ 200,000$ 1% 202,000$ 204,020$ 206,060$ 208,121$

Misc recurring 22,961$ 122,053$ 126,841$ 129,530$ 1% 130,825$ 132,134$ 133,455$ 134,789$

Misc non recurring ‐$ 262,975$ ‐$ ‐$ 1% ‐$ ‐$ ‐$ ‐$

Other Available Funds (Minus Debt Stab) 1,493,025$ 996,000$ 1,170,863$ 1,157,735$ Calculated 580,000$ 330,000$ 205,000$ 80,000$

Free Cash 998,025$ 596,000$ 720,863$ 852,735$ Phase Out 500,000$ 250,000$ 125,000$ ‐$

Lat./Part. Sewers 60,000$ 20,000$ 20,000$ 20,000$ Level 20,000$ 20,000$ 20,000$ 20,000$

Slip Fees 35,000$ 35,000$ 35,000$ 35,000$ Level 35,000$ 35,000$ 35,000$ 35,000$

Parking Receipts ‐$ ‐$ 50,000$ 50,000$ Level 25,000$ 25,000$ 25,000$ 25,000$

Overlay Reserve 400,000$ 345,000$ 345,000$ 200,000$ Not Used ‐$ ‐$ ‐$ ‐$

Debt Stabilization 1,198,478$ 2,353,478$ 2,353,478$ 1,861,464$ Planned Use 1,865,599$ 1,284,864$ 845,549$ 444,358$

TOTAL 104,640,008$ 107,373,197$ 109,154,018$ 112,118,813$ 114,645,605$ 116,989,955$ 119,677,247$ 122,481,058$

FY19 Actual FY20 Actual FY21 Recap FY22 Budget FY23 FY24 FY25 FY26Expenditures Assumption

General Government 3,416,440$ 3,758,494$ 4,186,263$ 4,210,960$ 2.5% 4,316,234$ 4,424,140$ 4,534,743$ 4,648,112$

Police 6,058,072$ 6,099,588$ 6,852,250$ 7,036,085$ 2.5% 7,211,987$ 7,392,287$ 7,577,094$ 7,766,521$

Fire 5,131,356$ 5,156,025$ 5,325,594$ 5,658,881$ 2.5% 5,800,353$ 5,945,362$ 6,093,996$ 6,246,346$

Education 40,900,969$ 42,716,672$ 43,502,155$ 44,673,035$ 3% 46,013,226$ 47,393,623$ 48,815,432$ 50,279,894$

Public Works (tax) 10,272,698$ 10,028,966$ 11,541,399$ 11,617,289$ 2.5% 11,907,721$ 12,205,414$ 12,510,550$ 12,823,313$

Land Use & Community Services 1,550,152$ 1,566,180$ 1,843,814$ 1,919,392$ 2.5% 1,967,377$ 2,016,561$ 2,066,975$ 2,118,650$

Recreation 822,990$ 890,366$ 953,198$ 990,497$ 2.5% 1,015,259$ 1,040,641$ 1,066,657$ 1,093,323$

Library 1,381,617$ 1,370,294$ 1,499,029$ 1,530,850$ 2.5% 1,569,121$ 1,608,349$ 1,648,558$ 1,689,772$

Debt Service ‐ General Govt 6,002,641$ 6,578,078$ 6,640,432$ 6,658,989$ Existing/Proj. 7,035,694$ 6,816,888$ 6,734,394$ 6,781,638$

Retirement 6,207,828$ 6,644,945$ 7,164,259$ 7,700,576$ 8% 8,316,622$ 8,981,952$ 9,700,508$ 10,476,549$

Employee Benefits/Insurance 13,547,052$ 13,765,135$ 14,001,387$ 14,017,028$ 5% 14,717,879$ 15,453,773$ 16,226,462$ 17,037,785$

Capital Outlay (All Departments) 998,025$ 596,000$ 720,863$ 852,735$ AVG 791,000$ 791,000$ 791,000$ 791,000$

Essex Tech 2,364,063$ 2,502,731$ 2,980,268$ 3,399,113$ 5% 3,569,069$ 3,747,522$ 3,934,898$ 4,131,643$

Other Amounts to be Raised 2,066,571$ 1,967,280$ 1,943,107$ 1,853,383$ Calculated 1,878,451$ 1,904,020$ 1,930,100$ 1,956,702$

Offsets 36,401$ 37,746$ 39,119$ 46,942$ 2% 47,881$ 48,838$ 49,815$ 50,812$

State & County 1,186,910$ 1,252,808$ 1,235,335$ 1,206,441$ 2% 1,230,570$ 1,255,181$ 1,280,285$ 1,305,891$

Overlay Reserves 843,260$ 676,726$ 668,653$ 600,000$ Level 600,000$ 600,000$ 600,000$ 600,000$

TOTAL 100,720,474$ 103,640,755$ 109,154,018$ 112,118,813$ 116,109,994$ 119,721,531$ 123,631,366$ 127,841,248$

SURPLUS / (DEFICIT) ‐$ (1,464,389)$ (2,731,576)$ (3,954,119)$ (5,360,191)$

GENERAL FUND 5‐YEAR FORECAST

6

FINANCING SOURCES

Overview This section of the budget document is intended to provide information and context on the various revenue sources that are used to finance the expenditures authorized through the adoption of the Town’s annual operating budget. A key component of the budget development process each year is identifying available and projected revenue in order to determine the level of financial flexibility to absorb fixed costs and allocate available resources. The Town’s four major revenue categories are Taxes, Local Receipts, State Aid, and Other Available Funds, which is common among most Massachusetts communities. While the Town has some direct control over certain areas of revenue, most of the revenue determination process is based on accurately estimating anticipated collections using historical data, real‐time collections, and anticipated future changes. Since the process relies on estimation, a conservative approach is used to ensure the budget remains balanced and to avoid any particular revenue category falling significantly short of projection. This conservative approach has proven critical in FY2022 due to the ongoing uncertainty and economic impact caused by the public health emergency. This is evident in several key revenue categories still well below pre‐pandemic levels. Taxes The primary sources of revenue for municipalities in the Commonwealth are real estate and personal property taxes. In FY2022, taxes account for 77.32% of all estimated general fund operating revenue. For purposes of taxation, real property includes land and buildings and improvements erected or affixed to land, and personal property consists of stock, inventory, furniture, fixtures, and machinery. The Town’s Board of Assessors determines the value of all taxable land, which is revalued at fair market value every five years and updated every year. FY2019 was the most recent revaluation year for the Town. The Town’s Board of Assessors is also responsible for determining the value of personal property through an annual review process. Under the provisions of Proposition 2 ½, property taxes, in the aggregate, may not exceed 2.5% of their "full and fair cash value". This is known as the "Levy Ceiling". In addition, annual levy increases may not exceed 2.5% more than the previous year's “Levy Limit” plus the New Growth in taxes added from any new properties, renovations to existing properties, or condominium conversions. Assessors are required to submit information on New Growth in the tax base for approval by the Department of Revenue as part of the tax rate setting process. The total FY2022 Tax Levy is estimated to be $86,688,223, which is anticipated to be at the full Levy Limit. The FY2022 New Growth estimate is $600,000, as it has been in recent years. The Town consistently meets this target, as expected.

7

Local Receipts

Local receipts are locally generated revenues other than real estate and personal property taxes.These include categories such as Motor Vehicle Excise, Meals Tax, Hotel/Motel Tax, Payments inLieu of Taxes, Charges for Services, Fees, Licenses and Permits, Penalties and Interest, InvestmentIncome, Fines and Forfeits, and other miscellaneous income. Some of these are set by Statestatute, while others are determined by local by laws. Local receipts are estimated to be 10.26%of general fund operating revenue in FY2022.

Motor Vehicle Excise

Motor Vehicle Excise is a locally imposed annual tax assessed to owners of motor vehiclesregistered/principally garaged to addresses within the community (MGL c. 60A). The excise taxrate is set by statute at $25 per $1,000 of vehicle value based on manufacturer’s list price andyear of the vehicle. This is by far the largest and most dependable local receipt. The FY2022estimate is $4.55 million, factoring in the continued economic uncertainty.

FY2019 Actual FY2020 Actual FY2021 Recap FY2022 Estimated

Prior Year Levy 75,516,164$ 78,198,964$ 80,994,021$ 83,988,511$

Prop 2 1/2 Increase 1,843,350$ 1,949,669$ 1,982,803$ 2,099,712$

New Growth 794,896$ 840,083$ 969,639$ 600,000$

TOTAL TAXES 78,154,410$ 80,988,716$ 83,946,463$ 86,688,223$

TAXES

$50,000,000

$55,000,000

$60,000,000

$65,000,000

$70,000,000

$75,000,000

$80,000,000

$85,000,000

$90,000,000

$95,000,000

$100,000,000


Tax Levy Breakdown

Prior Year Levy Prop 2 1/2 Increase New Growth

8

Meals Tax A city or town may impose a local option meals excise on sales by a vendor of restaurant meals occurring within that city or town. The rate is 0.75% of the vendor's gross receipts from restaurant meal sales. This local excise is imposed along with the state sales tax on meals, bringing the effective tax rate on sales of meals to 7.0% in a city or town that has decided to adopt it. This is a steady revenue stream during good economic conditions that has been severely impacted by the pandemic. The Town estimates this revenue at $650,000 in FY2022. Hotel/Motel Tax The hotel motel tax, or room occupancy excise, applies to room rentals of 90 days or less in hotels, motels, bed and breakfast establishments, and lodging houses. Beginning July 1, 2019, the room occupancy excise also applies to short‐term rentals of property for 31 days or less. For all types of rental accommodations, if the total amount of rent is less than $15 per day, no tax is due. Massachusetts cities and towns are permitted to charge a local room occupancy excise tax up to 6.0%. Like the meals tax, this revenue is collected by the State and distributed quarterly to communities. The FY2022 estimated amount is $800,000, further reduced from FY2021.


Motor Vehicle Excise 5,018,990$ 4,583,733$ 4,450,000$ 4,550,000$

MOTOR VEHICLE EXCISE

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000


Motor Vehicle Excise

9

Boat Excise The other excise category is for Boats. In accordance with MGL c. 60B, this is an amount levied on boats and ships in lieu of a personal property tax for using the state’s waterways. Assessed annually as of July 1, the excise is paid to the community where the boat or ship is usually moored or docked. This excise brings in roughly $20,000 per year in local receipts with a similar amount credited to waterways improvements.

Payments in Lieu of Taxes (PILOT) A PILOT is an agreement between a municipality and an entity that is not subject to taxation, such as a non‐profit, charitable, or educational organization, whereby the organization agrees to make a voluntary payment to the municipality. Several entities have such agreements with the Town, including Mass General, Lahey, and Care Dimensions. This is also where the Town accounts for its annual contribution from the Electric Division. In FY2022, this revenue category is projected to increase from $1.36 million to $1.65 million, driven primarily by the phased increase of the Electric Division’s ongoing contribution to the Town, which was last adjusted in 1995. The Electric Division makes an annual contribution to the Town based on percentage of sales. The new formula is being phased in over four years, ultimately ending up at 0.50% of sales.

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000


Other Excise Taxes

Meals Tax Hotel/Motel Tax Boat Excise


Meals Tax 945,678$ 861,597$ 600,000$ 650,000$

Hotel/Motel Tax 1,684,366$ 1,390,646$ 915,000$ 800,000$

Boat Excise 20,267$ 19,932$ 20,000$ 20,000$

TOTAL TAXES 2,650,312$ 2,272,176$ 1,535,000$ 1,470,000$

OTHER EXCISE

10

Charges for Services Most of the revenue associated with charges for services is similar to what some communities may refer to as indirect costs. The Charges for Services category, broken out in a detailed formula in the annual budget, is how the Town charges the utilities (Water, Sewer, Electric) for its share of staff and resources they utilize, such as Accounting, Treasurer/Collector, etc. The formula was revised in recent years including adding all information technology staff into the calculation versus directly charging payroll to the utilities. The FY2022 estimated amount is $1.22 million.

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000


Payments in Lieu of Taxes


Payments in Lieu of Taxes 1,235,208$ 1,224,087$ 1,363,000$ 1,649,178$

PAYMENTS IN LIEU OF TAXES

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000


Charges for Services


Charges for Services 1,007,911$ 1,165,177$ 1,162,301$ 1,217,962$

CHARGES FOR SERVICES

11

Fees Municipalities charge user fees for certain services in order to recover the cost of staff time and materials. The goal, when possible, is to have the services be self‐sustaining based on fees charged to the individuals versus all taxpayers. The Town charges for a variety of fees, such as marriage certificates, dog licenses, and municipal lien certificates. Total Fees for FY2022 are estimated at $712,500.

Licenses and Permits License revenue arises from the Town’s regulation of certain activities, for example the sale of alcoholic beverages. A person or organization pays a license fee to engage in the activity for a specific period. The primary licensing agency in the Town is the Select Board. All fees are set by one of three methods: State law, Town By‐law, or Licensing Body. Permits are also required when a person or business wants to perform a municipally regulated activity, such as building, electrical, or plumbing work on a commercial or residential property. Most of the overall permit revenue is brought in through building permits, collected by Inspectional Services. Licenses and Permits is another area where the Town historically estimates conservatively. Since the driving force is often building permits, collections in this category are somewhat dependent on large projects and the strength of the economy as a whole. Licenses and Permits are estimated to bring in $970,000 in FY2022, up from last year when certain alcoholic license fees were waived.

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000


Fees


Fees 732,355$ 795,922$ 712,500$ 712,500$

FEES

12

Penalties and Interest on Taxes and Excise The Town receives interest and charges on overdue taxes. Interest rates for overdue real and personal property taxes are 14%, and for tax title accounts, 16%. The interest rate for delinquent excise tax accounts is 12% from the due date. If real and personal property taxes are not paid by May 1, in the year of the tax, a demand for payment notice is sent to delinquent taxpayers. Delinquent motor vehicle taxpayers are sent a demand ($10), a warrant ($10), and two separate notices from a deputy tax collector ($12 and $17). Once a delinquent real estate account goes into a process of tax title, there are other fees added to the property tax bills. These charges include the cost of recording the redemption and demand notices. The FY2022 estimate is $300,000. Investment Income Under Massachusetts General Law, all monies held in the name of the Town, which are not required to be kept liquid for purpose of distribution, shall be invested in such a manner as to require the payment of interest on the money at the highest possible rate reasonably available. The investment decision must consider safety, liquidity, and yield. Investment of available town funds is the jurisdiction of the Town Treasurer by statute. This has been a reliable source of revenue in recent years due to market conditions; however, it is being estimated conservatively based on the current MMDT rate of 1.56%. The estimate for FY2022 is $160,000. Fines and Forfeits The FY2022 estimate is $50,000 based solely on collections of court fines.

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000


Licenses and Permits


Licenses and Permits 1,155,913$ 924,763$ 850,000$ 970,000$

LICENSES AND PERMITS

13

Miscellaneous Recurring This revenue source has grown in recent years based on two agreements the Town has entered into for services. The first is with Essex North Shore Agricultural & Technical School to provide a school resource officer. The second, through the Danvers Community Council, partially funds the Assistant Senior & Social Services Director. The total FY2022 estimate is $129,530. Medicaid Reimbursement In accordance with laws and regulations governing the Medicaid program, school systems mandated by the Individuals with Disabilities Education Act (IDEA) to provide health‐related services to their special education student populations are permitted to file claims for partial federal reimbursement of both their health service and administrative support expenditures incurred in providing those services. Qualifying administrative support expenditures fall into two categories: support activities associated with the delivery of health‐related services; and support activities that benefit a state’s Medicaid program administration generally. The FY2022 estimate is $200,000. Departmental Revenue This final local receipt category covers a variety of miscellaneous revenue sources across multiple departments. The FY2019 figure was artificially high as the Town received $200,000 from the State related to the 40R Smart Growth Zoning program, which is being carried in the Town’s Free Cash certification until appropriated at Town Meeting. The FY2022 estimate for Departmental Revenue is $95,000.

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000


Penalties, Investments, Fines

Penalites and Interest Investment Income Fines and Forfeits


Penalites and Interest 302,281$ 235,995$ 300,000$ 300,000$

Investment Income 470,601$ 440,722$ 160,000$ 160,000$

Fines and Forfeits 53,546$ 43,835$ 50,000$ 50,000$

TOTAL 826,429$ 720,551$ 510,000$ 510,000$

PENALTIES, INVESTMENTS, FINES

14

State Aid State Aid is funded monthly and detailed through the Commonwealth’s “Cherry Sheet”, named for the cherry‐colored paper on which it was originally printed. While consisting mostly of Chapter 70 school aid and unrestricted general governmental aid, there are several categories that make up the total State Aid number. For budgeting purposes, estimates are generally based on the Governor’s initial budget submission and revised as the budget moves through the Statehouse and back to the Governor for final approval and signature. For FY2021, due to the public health emergency, the estimates were derived from ongoing discussions with State officials and peer communities as well historical analysis. These estimates proved to be sufficiently conservative based on the final budget. The FY2022 estimate returns to the usual method of budgeting the Governor’s proposal. State Aid is estimated to be 9.73% of general fund operating revenue in FY2022. Chapter 70 Based on the Education Reform Act of 1993, and subsequent amendments, the Chapter 70 program is a formula‐based initiative to provide critical financial support to local school districts. The program also established minimum spending levels by the district as well based on several factors. While the Chapter 70 program was overhauled based on the 2019 Student Opportunities Act, the Town did not see a noticeable change beyond normal growth. The current FY2022 estimate is $ $7.21 million.

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000


Other Miscellaneous Revenue

Miscellaneous Recurring Medicaid Reimbursement Departmental Revenue


Miscellaneous Recurring 22,961$ 122,053$ 126,841$ 129,530$

Medicaid Reimbursement 312,986$ 200,242$ 200,000$ 200,000$

Departmental Revenue 311,226$ 173,563$ 95,000$ 95,000$

TOTAL 647,172$ 495,858$ 421,841$ 424,530$

OTHER MISCELLANEOUS REVENUE

15

Unrestricted General Government Aid (UGGA) UGGA is, as its name suggests, an unrestricted aid amount usually tied to forecasted revenue growth at the State level. For FY2022, the proposed funding for communities is increasing by 3.5%. This the Town’s second largest state aid source, with an FY2022 estimate of $3.13 million.

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

$8,000,000


Chapter 70


Chapter 70 6,838,332$ 7,108,192$ 7,108,192$ 7,209,712$

CHAPTER 70

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000


Unrestricted General Government Aid (UGGA)


UGGA 3,044,655$ 3,030,881$ 3,024,383$ 3,130,236$

UNRESTRICTED GENERAL GOVERNMENT AID (UGGA)

16

Other State Aid Veterans’ Benefits: Under Chapter 115, Section 6, municipalities receive a 75% State reimbursement on the total expenditures made on veterans’ benefits. Charter Tuition Reimbursement: This is a formula‐based program subject to State appropriation to reimburse sending districts for student tuition and the capital facilities tuition component paid to Commonwealth charter schools. Exemptions for Veterans, Blind Person, Surviving Spouse: To reimburse the Town for property tax exemptions granted to qualifying veterans, blind persons, surviving spouses, and elder persons. State Owned Land: To reimburse the Town for foregone tax revenue due to certain types of tax‐exempt State‐owned land. MSBA Reimbursement: Under the old Massachusetts School Building Authority reimbursement program, cities and towns received payments prorated through the life of the bond. The total FY2022 estimate for these other components of State Aid, as well as Library offset funding, is $567,273.

Other Available Funds Other Available Funds vary from community to community. Generally, they are one‐time sources of revenue such as reserves, surpluses, and receipts subject to appropriation. The FY2022 use of available funds accounts for 2.69% of all estimated general fund operating revenue. Debt Stabilization Debt stabilization is a reserve fund historically used by the Town to smooth the debt impact on the tax levy as larger issuances are sold, the most recent being the Smith School. Based on the Town’s debt plan, the FY2022 usage of the fund would drop from last year’s figure of $2.35 million to $1.86 million.

$0

$200,000

$400,000

$600,000

$800,000


Other State Aid


Other State Aid 636,819$ 450,689$ 545,997$ 567,273$

OTHER STATE AID

17

Free Cash Free Cash is comprised of remaining, unrestricted funds from operations of the previous fiscal year, including unexpended free cash from the prior year, actual receipts in excess of revenue estimated on the tax recapitulation sheet, and unspent amounts in budget line items. The Town generally uses Free Cash within the operating budget to fund one‐time expenses such as Capital Outlay. The FY2022 estimated use of free cash in the operating budget is $852,735 to cover various capital equipment and vehicles. Overlay Surplus Overlay is an account that funds anticipated property tax abatements, exemptions, and uncollected taxes. Additions to the overlay reserve are not funded by the normal appropriation process but instead raised on the tax rate recapitulation sheet. If funded conservatively, a surplus is built that can be released if verified by the Board of Assessors and thus made available as a revenue source for further appropriation. The FY2022 budget utilizes $200,000. Other special revenue or receipts reserved accounts used to offset related costs include Laterals/Particulars, Slip Fees, and Parking Receipts. For FY2022, this is estimated at $105,000.

Conclusion Conservatively estimating revenue continues to be an effective budgeting strategy for the Town. In addition to ensuring structural deficits do not emerge, the practice provides at least one potential safeguard should the economy experience a downturn, as we have seen during the pandemic. On the tax side, budgeting at our levy limit will prove to be difficult in future years as certain fixed costs continue to outpace Proposition 2 ½. All four key revenue categories (taxes, local receipts, state aid, and other available) will need to be continuously analyzed and forecasted so that the Town can make key decisions well in advance of any revenue challenges.

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000


Other Available Funds


Other Available Funds 2,691,503$ 3,349,478$ 3,524,341$ 3,019,199$

OTHER AVAILABLE FUNDS

18

RESERVES Overview A key measure of a community’s financial position is its available reserves. Not only are they a safeguard against uncertainty or long‐term liabilities, they are also an important metric for ratings agencies when valuing a community’s creditworthiness. The Town of Danvers has several key reserves and has policies in place to ensure these reserves are maintained and used only for specific purposes. Town reserve policies can be found in the financial policies area of the budget document. The major categories are shown below with balances and trend information.

$‐

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

$16,000,000

$18,000,000

$20,000,000

FY2019 FY2020 FY2021* FY2022**

Reserve Fund Balances

General Stabilization Debt Stabilization OPEB Free Cash (After Appropriation)

Reserve Fund FY2019 FY2020 FY2021* FY2022**

General Stabilization 1,571,770$ 3,099,203$ 4,099,203$ 4,099,203$

Debt Stabilization 5,980,318$ 4,457,829$ 2,889,351$ 2,527,888$

OPEB 6,648,458$ 7,899,716$ 8,958,675$ 10,091,248$

Free Cash (After Appropriation) 2,224,586$ 1,158,418$ 1,203,902$ 1,759,524$

Total Reserve Position 16,425,132$ 16,615,166$ 17,151,131$ 18,477,863$

* Projected (other than FC)

** Subject to Appropriation

19

EDUCATION COSTS

FY2019 FY2020 FY2021 FY2022 Actual Actual Budget Proposed

School Committee

Controlled

Essex North Shore

Agricultural and Technical

High School (1)

Municipal

Contribution (2)

TOTAL EDUCATION COST

(1) The Town pays an annual assessment to the vocational high school based on the Town's student enrollment as a percentage of the

Essex North Shore budget.

(2) After the Fiscal Year ends, the Town and School Department calculate the total costs of running the Danvers school system. The

municipal contribution is reflected separately from the committee‐controlled budget.

40,900,969 42,716,672 43,502,155 44,673,035

2,364,063

2,502,731

2,980,268

3,399,113

20,053,179

20,404,222

20,848,907

63,318,211

65,623,625

67,331,330

20

FY22 Approp. Tax Levy Free Cash Enterprise/Other Source

Education Total 44,673,035$ 44,673,035$

Moderator Personnel 500$ Operating 1,000$

Total 1,500$ 1,500$

Select Board Personnel 18,000$ Operating 9,550$

Total 27,550$ 27,550$

Finance Committee Reserve Total 125,000$ 125,000$

Legal Total 121,423$ 121,423$

Management Personnel 169,541$ Operating 163,725$

Total 333,266$ 333,266$

Information Technology Personnel 423,065$ Operating 199,916$

Total 622,981$ 622,981$

Department Head Personnel 1,198,790$ Operating 11,500$

Total 1,210,290$ 1,210,290$

Accounting Personnel 401,646$ Operating 72,400$

Total 474,046$ 474,046$

Assessing Personnel 311,255$ Operating 92,184$

Total 403,439$ 403,439$

Treasurer/Collector Personnel 272,496$ Operating 70,800$

Total 343,296$ 293,296$ 50,000$ Parking Receipts

Human Resources Personnel 203,523$ Operating 48,959$

Total 252,482$ 252,482$

Town Clerk Personnel 255,562$ Operating 40,125$

Total 295,687$ 295,687$

Police Department & Dispatch Personnel 6,594,108$ Operating 441,977$

Total 7,036,085$ 7,036,085$

Fire Department Personnel 5,285,622$ Operating 373,259$

Total 5,658,881$ 5,658,881$

TABLE OF APPROPRIATIONS

21

FY22 Approp. Tax Levy Free Cash Enterprise/Other SourceDPW (Tax Supported) Personnel 4,858,365$

Operating 6,758,924$ Total 11,617,289$ 11,597,289$ 20,000$ Lat/Part

Land Use & Community Services Personnel 1,664,587$ Operating 254,805$

Total 1,919,392$ 1,919,392$

Recreation Department Personnel 809,219$ Operating 181,278$

Total 990,497$ 990,497$

Library (Peabody Institute) Personnel 1,200,723$ Operating 330,127$

Total 1,530,850$ 1,530,850$

Debt Service Principal 3,967,900$ 1,861,464$ Debt StabilizationInterest 2,691,089$ 35,000$ Slip Fees

Total 6,658,989$ 4,562,525$ 200,000$ Overlay Surplus

Benefits & Insurances Total 14,017,028$ 14,017,028$

Retirement (Tax Supported) Total 7,700,576$ 7,700,576$

Capital Outlay DPW 373,000$ Police 254,985$

Fire 178,750$ Recreation 46,000$

Total 852,735$ -$ 852,735$

106,866,317$ 103,847,118$ 852,735$ 2,166,464$

Sewer Enterprise Fund Personnel 338,872Operating 4,947,604Transfers 178,849

Debt 656,099Capital Outlay 64,000

Total 6,185,424 6,185,424$ Sewer Receipts

Water Enterprise Fund Personnel 2,081,514Operating 4,258,568Transfers 343,346

Debt 2,066,776Capital Outlay 52,000

Total 8,802,204 8,802,204$ Water Receipts

14,987,628$ 14,987,628$

Total Operating Budget 121,853,945$ 103,847,118$ 852,735$ 17,154,092$

General Government Operating Subtotal

Enterprise Fund Subtotal

22

DEPARTMENTAL DETAILS

FISCAL YEAR 2022

OPERATING BUDGET

MODERATOR, SELECT BOARD, FINANCE COMMITTEE RESERVE, LEGAL COUNSEL

The Town Moderator is elected annually to a one‐year term, is paid a modest stipend, and is the presiding officer of the Town Meeting, ensuring that the Town’s business is conducted in an orderly manner. The Moderator has complete authority over all matters of rules, procedures, regulations, and the preservation of decorum. The Town Moderator also appoints members of the Finance Committee and the Town’s representative to the Essex Tech regional vocational school.

The Select Board is comprised of five members, serving staggered three‐year terms, and is the chief legislative body in Danvers, setting broad policy, acting in the best interest of its citizens, and having responsibility for hiring the Town Manager. Selectmen receive modest compensation, being adjusted this year for the first time in many years, and their budget allows for payment of conference fees and incidentals. The Board sets the time and place of Town Meeting and issues the Warrant, including the Annual Town Budget. Board members also serve as the Licensing Authority for the Town and review and vote to establish Traffic Rules & Orders.

The Finance Committee Reserve Fund exists in accordance with M.G.L. Chapter 40, § 6 to allow for an appropriate sum of money to be transferred (by vote of the Finance Committee) to a General Government department if a need arises. The proposed FY2022 budget of $125,000 is consistent with years prior to FY2021. Unexpended funds are returned to the General Fund at year’s end.

The Finance Committee is a nine‐member advisory body appointed by the Town Moderator to staggered three‐year terms. They review all departmental budgets and proposed warrant articles to be placed before the Town Meeting body. Members do not vote at Town Meeting or engage in debate; however, their recommendation on any Warrant article is treated as the main motion under that article.

Legal Counsel services are provided in Danvers by a private law firm on a contractual basis. The Town also uses special counsel when appropriate. Legal costs for this firm are budgeted in the Legal Counsel budget of the General Government as well as the utility divisions.

Legal Services FY2021 FY2022

General Government $131,423 $121,423

DPW – Water Division $31,713 $20,000

DPW – Sewer Division $9,851 $9,851

DPW – Electric Division $69,257 $69,257

Total $242,244 $220,531

23

FY2018 FY2019 FY2020 FY2021 FY2022 FY21‐FY22 FY21‐FY22Account_and_Description Actual Actual Actual Budget Proposed $ Increase % IncreaseS&W ‐ ELECTED POSITIONS 400 400 400 400 500 100 25.00%TOTAL SALARIES & WAGES 400 400 400 400 500 100 25.00%

MISCELLANEOUS SUPPLIES 0 0 1,150 1,150 1,000 ‐150 ‐13.04%TOTAL OPERATING EXPENSES 0 0 1,150 1,150 1,000 ‐150 ‐13.04%

TOTAL MODERATOR 400 400 1,550 1,550 1,500 ‐50 ‐3.23%

FY2018 FY2019 FY2020 FY2021 FY2022 FY21‐FY22 FY21‐FY22Account_and_Description Actual Actual Actual Budget Proposed $ Increase % Increase

S&W ‐ ELECTED POSITIONS 15,500 15,500 15,261 15,500 18,000 2,500 16.13%TOTAL SALARIES & WAGES 15,500 15,500 15,261 15,500 18,000 2,500 16.13%

ADVERTISING 460 477 650 650 800 150 23.08%MISCELLANEOUS SUPPLIES 207 200 14 400 400 0 0.00%MEALS 0 168 0 200 200 0 0.00%CONFERENCE FEES 564 471 185 600 600 0 0.00%PARKING, TOLLS, ETC. 0 0 0 50 50 0 0.00%DUES AND MEMBERSHIPS 6,617 6,782 6,952 7,500 7,500 0 0.00%TOTAL OPERATING EXPENSES 7,848 8,098 7,801 9,400 9,550 150 1.60%

TOTAL SELECT BOARD 23,348 23,598 23,062 24,900 27,550 2,650 10.64%


RESERVE FUND TRANSFER 120,028 0 75,000 230,000 125,000 ‐105,000 ‐45.65%TOTAL OPERATING EXPENSES 120,028 0 75,000 230,000 125,000 ‐105,000 ‐45.65%


LEGAL SERVICES 82,637 71,850 90,112 121,423 121,423 0 0.00%CABLE RENEWAL 20,000 481 0 10,000 0 ‐10,000 ‐100.00%TOTAL OPERATING EXPENSES 102,637 72,331 90,112 131,423 121,423 ‐10,000 ‐7.61%

MODERATOR

SELECT BOARD

LEGAL COUNSEL

FINANCE COMMITTEE RESERVE FUND

24

MANAGEMENT

DEPARTMENT DESCRIPTION

Plan, organize, direct, and evaluate Town services, including broad operational objectives

Administer Town by‐laws / regulations of the Danvers Select Board (DSB) and imple‐ment DSB policy objectives

Identify community challenges and propose short‐term and long‐term solutions

Supervise senior managers and guide broader leadership team

Account for all funds and develop broad fiscal policy

Represent the Town to other municipal, regional, state, and business groups

Present recommendations to the DSB, Finance Committee and Town Meeting on use of funds, adoption of by‐laws, purchase of land,and sale of bonds

BUDGET COMMENTARY The budget reflects an increase of $8,619 based on permanent personnel costs, including the designation of the procurement specialist as chief procurement officer.

FISCAL YEAR 2021 ACCOMPLISHMENTS

Coordinated the Town’s response to COVID‐19 pandemic

Worked with staff and officials to maintain AAA credit rating

Represented Town’s interests on MMA Board of Directors

Secured funding for phase 1 of the Rail Trail westward expansion

Facilitated safe and socially distanced June 2020 Annual Town Meeting and October2020 Special Town Meeting

FISCAL YEAR 2022 STRATEGIC GOALS

Continue to improve/expand communication with all Town stakeholders

Reboot Citizens Academy and develop an internal version of Citizens Academy (Dan‐versU) for employees

Continue feasibility / site option analysis for consolidated DPW facility to house all divisions

Implement recommendations from the Welcoming Community Working Group, once adopted by the Select Board

Management FTE FY2020 FY2021 FY2022

Town Manager DH DH DH

Assistant Town Manager DH DH DH

Exec. Secretary to Town Mgr 1.00 1.00 1.00

Procurement Specialist 1.00 1.00 1.00

Total 2.00 2.00 2.00

25


S&W PERMANENT‐FULL TIME 69,843 145,265 153,591 157,922 166,516 8,594 5.44%LONGEVITY 800 1,750 1,825 1,800 1,825 25 1.39%SICK LEAVE INCENTIVE 575 575 675 1,200 1,200 0 0.00%TOTAL SALARIES & WAGES 71,218 147,590 156,091 160,922 169,541 8,619 5.36%

OFFICE EQUIPMENT MAINTENANCE 0 0 27 500 500 0 0.00%POSTAGE METER/SCALE RENTAL 0 198 0 1,000 1,000 0 0.00%CONSULTING SERVICES 8,438 18,692 6,859 17,500 17,500 0 0.00%POSTAGE 0 82,212 79,003 83,540 83,540 0 0.00%ADVERTISING 274 2,658 1,600 2,300 2,300 0 0.00%PRINTING (NON‐FORMS) 0 7,702 8,548 9,000 9,000 0 0.00%FITNESS CLUB MEMBERSHIPS 0 125 125 250 250 0 0.00%GENERAL OFFICE SUPPLIES 1,619 5,553 4,655 4,500 4,500 0 0.00%PHOTOCOPY SUPPLIES 0 7,465 8,667 14,500 14,500 0 0.00%MISCELLANEOUS SUPPLIES 48 48 826 200 200 0 0.00%PERMITS/LICENSES 0 200 200 200 200 0 0.00%TRAVEL ALLOWANCE 31 30 0 0 0 0 0.00%MILEAGE REIMBURSEMENT 0 1,867 25 800 800 0 0.00%MEALS 317 140 302 500 500 0 0.00%CONFERENCE FEES 997 2,469 1,207 3,700 3,700 0 0.00%PARKING, TOLLS, ETC. 129 123 239 300 300 0 0.00%DUES AND MEMBERSHIPS 1,550 2,130 2,923 4,035 4,035 0 0.00%SUBSCRIPTIONS 600 71 643 900 900 0 0.00%OUT OF STATE TRAVEL EXPENSES 6,205 11,001 10,596 20,000 20,000 0 0.00%TOTAL OPERATING EXPENSES 20,208 142,682 126,444 163,725 163,725 0 0.00%

TOTAL MANAGEMENT 91,426 290,272 282,536 324,647 333,266 8,619 2.65%

MANAGEMENT

26

INFORMATION TECHNOLOGY


Maintain Town‐wide technology infrastructure

Provide staff support and training

Plan and implement software and hardware upgrades

Design and life‐cycle planning

Data and cyber security

Compliance management

BUDGET COMMENTARY

The Fiscal Year 2022 budget reflects an overall increase of 6.17%. Some of this increase results from realignment of funding sources for phone and internet service. Consolidation of phone service throughout the Town has allowed us to increase internet bandwidth and realize a net savings overall on telephone and internet.


Designed and implemented various network upgrades, including core switch

Virtualized numerous critical workloads into our central datacenter

Completed a grant funded fiber optic link between Danvers, Wenham, Hamilton, andEssex


Design and implement infrastructure for the new Smith School

Migrate all video security for Town and Schools onto a single system

School phone system replacement

Continue to pursue additional regionalization opportunities

Information Technology FTE FY2020 FY2021 FY2022

IT Director DH DH DH

Assistant IT Director ‐ ‐ 1.00

Information Systems Project Manager 1.00 1.00 1.00

IT Office Coordinator ‐ 1.00 1.00

Network Engineer 1.00 1.00 1.00

Network Administrator 1.00 1.00 ‐

Technical Support Specialist 1.00 1.00 1.00

Total 4.00 5.00 5.00

27


S&W PERMANENT‐FULL TIME 345,512 202,214 317,692 395,449 420,365 24,916 6.30%LONGEVITY 1,600 350 350 600 900 300 50.00%SICK LEAVE INCENTIVE 1,875 0 1,325 1,800 1,800 0 0.00%TOTAL SALARIES & WAGES 348,987 202,564 319,367 397,849 423,065 25,216 6.34%

COMPUTER MAINTENANCE 49,245 49,943 34,937 50,000 50,000 0 0.00%TELEPHONE SYSTEM MAINTENANCE 8,782 5,108 11,393 10,500 10,500 0 0.00%SOFTWARE MAINTENANCE 78,858 74,913 110,322 84,247 87,463 3,216 3.82%CONSULTING SERVICES 0 698 0 0 0 0 0.00%TRAINING SERVICES 4,632 3,580 2,851 12,250 12,250 0 0.00%TELEPHONE 23,343 20,906 22,353 15,586 23,353 7,767 49.83%POSTAGE 71,492 0 0 0 0 0 0.00%ADVERTISING 1,766 300 0 0 0 0 0.00%PRINTING (NON‐FORMS) 6,778 0 0 0 0 0 0.00%FITNESS CLUB MEMBERSHIPS 250 0 0 250 250 0 0.00%GENERAL OFFICE SUPPLIES 2,968 358 0 0 0 0 0.00%PHOTOCOPY SUPPLIES 6,586 0 50 0 0 0 0.00%COMPUTER SUPPLIES 10,239 16,528 3,188 15,000 15,000 0 0.00%SOFTWARE 219 0 0 0 0 0 0.00%MISCELLANEOUS SUPPLIES 336 0 0 0 0 0 0.00%PERMITS/LICENSES 600 400 200 700 700 0 0.00%MILEAGE REIMBURSEMENT 1,528 281 495 400 400 0 0.00%CONFERENCE FEES 1,670 0 0 0 0 0 0.00%DUES AND MEMBERSHIPS 2,574 0 0 0 0 0 0.00%CASUALTY/LIABILITY INSURANCE 200 0 0 0 0 0 0.00%TUITION REIMBURSEMENT 2,500 0 0 0 0 0 0.00%TOTAL OPERATING EXPENSES 274,566 173,014 185,790 188,933 199,916 10,983 5.81%

TOTAL INFORMATION TECHNOLOGY 623,553 375,577 505,157 586,782 622,981 36,199 6.17%

INFORMATION TECHNOLOGY

28

DEPARTMENT HEADS

DEPARTMENT DESCRIPTION The Department Head budget contains funding for the positions that, collec‐tively, oversee the Town’s broad functional service areas, such as Public Works & Utilities, Public Safety, Land Use & Community Services, Finance, or specialized service areas that cross all departments in their scope, such as Management, Information Technology, and Human Resources. These posi‐tions, along with roughly sixteen others, are covered by the Management Compensation Plan (performance evaluations), created by Town Meeting in 1979 and is approved annually by the Select Board.

BUDGET COMMENTARY The Department Heads budget is increasing 1.03%. This net increase reflects funding to restart the MCP, after salaries for managers and other union/non‐union employees were frozen in FY2021, as well as savings resulting from the elimination of the Director of Administrative Service position (following the promotion of the Assistant Town Clerk and Treasurer/Collector into their respective division head roles).


Eliminated Director of Administrative Services position after promotion of Assistant Treasurer/Collector and Town Clerk

Collaborated on various projects and special events


Welcome new Police Chief into the management team

Complete new management development training program

Department Heads FTE FY2020 FY2021 FY2022

Town Manager 1.00 1.00 1.00

Assistant Town Manager 1.00 1.00 1.00

Finance Director 1.00 1.00 1.00

Director of Administrative Services 1.00 1.00 ‐

Director of Human Resources 1.00 ‐ ‐

Police Chief 1.00 1.00 1.00

Fire Chief 1.00 1.00 1.00

Director of Public Works & Utilities 1.00 1.00 1.00

Director of Information Technology 1.00 1.00 1.00

Director of Land Use & Community Svcs 1.00 1.00 1.00

10.00 9.00 8.00

29


S&W PERMANENT‐FULL TIME 1,280,112 1,143,083 1,187,237 1,183,496 1,198,790 15,294 1.29%EDUCATIONAL INCENTIVE 30,979 31,761 39,270 0 0 0 0.00%TOTAL SALARIES & WAGES 1,311,091 1,174,844 1,226,507 1,183,496 1,198,790 15,294 1.29%

TRAVEL ALLOWANCE 7,780 5,690 5,497 5,500 5,500 0 0.00%TUITION REIMBURSEMENT 3,465 1,600 2,250 9,000 6,000 ‐3,000 ‐33.33%TOTAL OPERATING EXPENSES 11,245 7,290 7,747 14,500 11,500 ‐3,000 ‐20.69%

TOTAL DEPARTMENT HEADS 1,322,336 1,182,134 1,234,254 1,197,996 1,210,290 12,294 1.03%

DEPARTMENT HEADS

30

ACCOUNTING


Maintain financial records for the Town

Maintain and process for Town and School: o Payrolls o Employee databases o Accounts payable

Maintain budgetary accounting systems for Town and School

Support departments in monitoring expenditures

Oversee Town audits BUDGET COMMENTARY Salaries & Wages for permanent staff is up 4.93% based on the full impact of department staffing changes as well as the additional week of payroll FISCAL YEAR 2021 ACCOMPLISHMENTS

Awarded Certificate of Achievement for Excellence in Financial Reporting from the GFOA for FY2019

Closed out FY2020 with a relatively clean audit and few findings from the Town’s independent auditor

Successfully coordinated and managed accounts payable as well as payroll throughout the stay‐at‐home order during COVID‐19 FISCAL YEAR 2022 STRATEGIC GOALS

Implement employee accruals through the accounting system enabling earned sick, vacation and personal time to print on payroll check stubs

Continue to meet the established formal guidelines for closing and reconciliation procedures

Continue to collaborate with Human Resources in developing new on‐boarding and off‐boarding procedures

Accounting FTE FY2020 FY2021 FY2022

Town Accountant 1.00 1.00 1.00

Assistant Town Accountant 1.00 1.00 1.00

Staff Accountant 1.00 1.00 1.00

Accounting Clerk 2.00 2.00 2.00

5.00 5.00 5.00

31


S&W PERMANENT‐FULL TIME 323,191 347,315 337,080 377,802 396,421 18,619 4.93%OVERTIME 602 124 473 985 600 ‐385 ‐39.09%LONGEVITY 1,817 1,225 1,350 1,350 2,875 1,525 112.96%SICK LEAVE INCENTIVE 1,150 1,050 600 1,800 1,750 ‐50 ‐2.78%TOTAL SALARIES & WAGES 326,760 349,714 339,503 381,937 401,646 19,709 5.16%

SOFTWARE MAINTENANCE 1,593 850 0 1,900 1,900 0 0.00%MEDICAL EXAMS (EMPLOYEE) 150 0 160 0 0 0 0.00%CONSULTING SERVICES 0 0 10,409 9,000 9,000 0 0.00%AUDITING SERVICES 34,180 38,900 24,730 29,700 29,700 0 0.00%TRAINING SERVICES 2,759 2,865 203 4,000 4,000 0 0.00%OPEB ACTUARIAL 0 10,783 3,995 12,000 12,000 0 0.00%FITNESS CLUB MEMBERSHIPS 500 250 250 500 500 0 0.00%GENERAL OFFICE SUPPLIES 5,244 4,869 3,139 5,600 5,600 0 0.00%FURNITURE & OFFICE EQUIP 0 0 562 0 0 0 0.00%MILEAGE REIMBURSEMENT 1,164 1,139 615 1,200 1,200 0 0.00%CONFERENCE FEES 927 312 325 4,820 4,820 0 0.00%DUES AND MEMBERSHIPS 648 745 595 1,180 1,180 0 0.00%TUITION REIMBURSEMENT 2,500 1,619 825 2,500 2,500 0 0.00%TOTAL OPERATING EXPENSES 49,665 62,332 45,808 72,400 72,400 0 0.00%

TOTAL ACCOUNTING 376,425 412,046 385,311 454,337 474,046 19,709 4.34%

ACCOUNTING

32

ASSESSING


Plan, organize, and direct all activities related to the Town’s Triennial Revaluation and Interim Updates to ensure the Town’s compliance with all sections under MGL Chapter 59 and the Department of Revenue

Analyze real estate market conditions, through statistical modeling, to develop val‐uation model applied globally to the Town

Manage the defense of all valuation cases at the Appellate Tax Board to minimize the Town’s negative exposure to potential liability and minimize impact to the Overlay

Administer the individual property tax exemptions as defined by State law (MGL c. 59, §5)

Maintain Assessors’ tax maps and track all changes to real estate parcels and personal property accounts, including ownership, improvements, new construction, condo conversions and subdivisions

BUDGET COMMENTARY The change in Consulting Services is a result of two events. First, Assessing implemented the Town’s first data review, a onetime expense, in the previous year. The Town was able to leverage inspections during the data review to suspend the cyclical inspection program for one year in FY2021 The line item returns in FY2022 to its normal level of funding. Office Supplies decreased due to the prior year’s one‐time cost of replacing a printer/scanner.


With the help of IT and other departments, Assessing was able to seamlessly transition to remote work without any interruption in taxpayers’ services


Successful Fiscal Year 2022 valuation certification

Piloting RMV portal at the Assessing counter to assist residents. This will enable resident to resolve issues related to excise tax billing without having to go to a Registry branch location

Assessing FTE FY2020 FY2021 FY2022

Chief Assessor 1.00 1.00 1.00

Assistant Assessor 1.00 1.00 1.00

Senior Account Clerk 1.00 1.00 1.00

Administrative Assistant 1.00 1.00 1.00

4.00 4.00 4.00

33


S&W PERMANENT‐FULL TIME 173,008 257,244 289,673 297,670 306,005 8,335 2.80%S&W ‐ APPOINTED POSITIONS 2,500 2,500 2,500 2,500 2,500 0 0.00%OVERTIME 0 0 151 0 0 0 0.00%LONGEVITY 1,750 1,300 1,525 1,525 1,575 50 3.28%SICK LEAVE INCENTIVE 0 0 0 600 1,175 575 95.83%TOTAL SALARIES & WAGES 177,258 261,044 293,848 302,295 311,255 8,960 2.96%

SOFTWARE MAINTENANCE 12,770 13,300 13,900 13,740 14,084 343 2.50%CONSULTING SERVICES 55,872 62,753 93,503 39,950 60,000 20,050 50.19%LAND APPRAISALS 2,000 1,776 2,450 2,000 2,000 0 0.00%TRAINING SERVICES 2,590 2,460 532 2,500 2,500 0 0.00%FITNESS CLUB MEMBERSHIPS 375 250 73 750 750 0 0.00%MAP REVISIONS 374 2,955 1,267 2,400 2,400 0 0.00%GENERAL OFFICE SUPPLIES 2,913 3,065 2,074 12,000 2,500 ‐9,500 ‐79.17%APPELLATE TAX BOARD 315 204 0 325 325 0 0.00%DEED TRANSFERS 65 ‐65 0 100 100 0 0.00%TRAVEL ALLOWANCE 2,600 3,690 3,880 3,880 3,880 0 0.00%MILEAGE REIMBURSEMENT 425 43 76 100 100 0 0.00%CONFERENCE FEES 201 3,383 0 2,500 2,500 0 0.00%PARKING, TOLLS, ETC. 0 0 461 150 150 0 0.00%DUES AND MEMBERSHIPS 360 250 310 360 360 0 0.00%SUBSCRIPTIONS 633 527 308 535 535 0 0.00%TUITION REIMBURSEMENT 0 5,621 21,509 3,000 0 ‐3,000 ‐100.00%TOTAL OPERATING EXPENSES 81,493 100,212 140,343 84,290 92,184 7,894 9.36%

TOTAL ASSESSING 258,751 361,255 434,192 386,585 403,439 16,854 4.36%

ASSESSING

34

TREASURER/COLLECTOR


Process real estate and personal property tax payments, motor vehi‐cle excise payments, boat excise tax payments, parking tickets, and municipal lien certificates

Manage all short‐term & long‐term debt authorizations

Invest a portfolio valued at more than $85.0 million

Perform monthly reconciliations & file State/Federal reports

Process all departmental receipts & post to General Ledger

Reconcile monthly bank statements with the cashbook; work with Town Accountant to reconcile cash and receivables

Initiate Tax Title and foreclosure proceedings and acts as custodian of tax title properties

BUDGET COMMENTARY The former Administrative Services budget has been split into the Treasurer/Collector budget and new Town Clerk budget. Overall, the combined budgets are increasing by roughly 5%.

FISCAL YEAR 2021 ACCOMPISHMENTS

Oversaw $8.0 million bond sale and refunding in August 2020 and $13.0 million bond anticipation note sale in February 2021

Managed tax collections and assisted residents during the pandemic with minimal interruption to services


Continue to improve monthly cash reconciliation and work with Accounting on identi‐fied variances

Develop an office manual and policies that outline functions in the office, such as pro‐cessing lockboxes, MLC’s (municipal lien certificates), Tax Receivables, etc

Update the Treasurer/Collector portion of the Town website to offer the public moretimely and comprehensive information

Treasurer/Collector FTE FY2020 FY2021 FY2022

Director of Administrative Services DH DH ‐

Treasurer/Collector ‐ ‐ 1.00

Assistant Treasurer/Collector 1.00 1.00 ‐

Senior Accounting Clerk 2.00 2.00 2.00

Accounting Clerk III 1.00 1.00 1.00

Total 4.00 4.00 4.00

35


S&W PERMANENT‐FULL TIME 334,505 349,823 353,525 374,580 268,846 ‐105,734 ‐28.23%S&W PERMANENT ‐ PART TIME 76,017 80,547 85,585 85,103 0 ‐85,103 ‐100.00%S&W ‐ TEMPORARY POSITIONS 0 17,017 17,420 18,393 0 ‐18,393 ‐100.00%S&W ‐ APPOINTED POSITIONS 600 600 600 600 0 ‐600 ‐100.00%S&W ‐ ELECTION WORKERS 5,410 9,822 14,383 23,140 0 ‐23,140 ‐100.00%OVERTIME 979 3,600 1,566 2,500 0 ‐2,500 ‐100.00%LONGEVITY 5,500 5,700 5,975 6,150 2,500 ‐3,650 ‐59.35%MEALS ALLOWANCE 160 0 0 0 0 0 0.00%SICK LEAVE INCENTIVE 2,891 3,013 2,460 3,450 1,150 ‐2,300 ‐66.67%TOTAL SALARIES & WAGES 426,062 470,121 481,515 513,916 272,496 ‐241,420 ‐46.98%

OFFICE EQUIPMENT MAINTENANCE 3,225 2,903 821 3,000 1,500 ‐1,500 ‐50.00%SOFTWARE MAINTENANCE 37,121 43,433 40,691 42,000 45,000 3,000 7.14%BANKING SERVICES 1,089 489 392 1,500 1,000 ‐500 ‐33.33%BOOK BINDING 945 1,995 855 1,000 0 ‐1,000 ‐100.00%PRINTING (NON‐FORMS) 10,861 12,874 15,646 15,500 12,500 ‐3,000 ‐19.35%GENERAL OFFICE SUPPLIES 12,450 9,636 2,504 6,000 3,000 ‐3,000 ‐50.00%FORMS PRINTING 4,879 5,822 12,170 9,500 0 ‐9,500 ‐100.00%FURNITURE & OFFICE EQUIP. 0 138 0 250 250 0 0.00%PARKING CLERK SUPPLIES 0 691 0 2,000 0 ‐2,000 ‐100.00%TAX TITLE COSTS 2,492 1,650 4,405 4,000 4,000 0 0.00%MILEAGE REIMBURSEMENT 716 115 0 250 250 0 0.00%CONFERENCE FEES 1,516 2,124 4,345 2,000 2,000 0 0.00%PARKING, TOLLS, ETC. 0 0 0 100 100 0 0.00%DUES AND MEMBERSHIPS 1,393 1,162 893 1,500 1,200 ‐300 ‐20.00%TUITION REIMBURSEMENT 0 0 0 6,000 0 ‐6,000 ‐100.00%TOTAL OPERATING EXPENSES 76,687 83,032 82,723 94,600 70,800 ‐23,800 ‐25.16%

TOTAL TREASURER/COLLECTOR 502,749 553,153 564,238 608,516 343,296 ‐265,220 ‐43.58%

TREASURER/COLLECTOR

36

HUMAN RESOURCES

DEPARTMENT DESCRIPTION The Human Resources Department serves as a partner to all Town and School employees and works to promote fairness, honesty, and equal op‐portunities for all employees. The Department provides support in areas of recruitment and selection, compensation, employee relations, labor rela‐tions, training, safety and wellness, as well as organizational and employee development.

BUDGET COMMENTARY No major changes are proposed for the Human Resources Department budget for FY2022. A minor change is shown in the personnel line due to the promotion of the HR Assistant to HR Generalist in mid‐FY2021. The changes made in FY2021, including aligning medical exam costs to the HR budget, have proven to be successful in allowing the department to better support other departments across the organization.


Supported employees through the COVID‐19 pandemic by developing new safety policies and procedures (including return to work and telecom‐muting policies), working with the EAP to share mental & physical health resources, and implementing the Families First Coronavirus ResponseAct

Centralized personnel files to ensure required documentation is easily accessible, maintained properly, and secure/confidential


Relaunch employee training program that was paused due to COVID‐19

Continue to update policies and procedures and distribute to all employees

Support the findings from the Welcoming Committee as applicable to employees

Human Resources FTE FY2020 FY2021* FY2022

Director of Human Resources DH ‐ ‐

Human Resources Generalist 0.87 1.00 2.00

Benefits Coordinator 1.00 1.00 1.00

Human Resources Assistant ‐ 1.00 ‐

Total 1.87 3.00 3.00 * Director position funding repurposed to create first HR Generalist position.

37


S&W PERMANENT‐FULL TIME 38,013 57,862 139,870 189,493 201,448 11,955 6.31%S&W PERMANENT ‐ PART TIME 71,883 62,665 1,976 0 0 0 0.00%S&W ‐ TEMPORARY POSITIONS 17,567 59 0 0 0 0 0.00%OVERTIME 76 1,988 0 0 0 0 0.00%LONGEVITY 1,300 1,350 850 875 875 0 0.00%SICK LEAVE INCENTIVE 0 0 0 1,800 1,200 ‐600 ‐33.33%TOTAL SALARIES & WAGES 128,839 123,924 142,695 192,168 203,523 11,355 5.91%

MEDICAL EXAMS 0 0 0 15,000 15,000 0 0.00%ARBITRATION FEES 425 6,517 0 2,000 2,000 0 0.00%TRAINING SERVICES 1,364 1,492 3,950 7,000 7,000 0 0.00%EMPLOYEE ASSISTANCE PROGRAM 0 0 0 1,000 1,000 0 0.00%ADVERTISING 2,556 550 450 8,000 8,000 0 0.00%FITNESS CLUB MEMBERSHIPS 321 1,123 0 0 0 0 0.00%PERSONNEL ADMINISTRATION 11,124 7,426 13,057 9,000 9,000 0 0.00%GENERAL OFFICE SUPPLIES 4,058 1,646 1,881 1,875 1,875 0 0.00%PARKING CLERK SUPPLIES 607 0 0 0 0 0 0.00%HUMAN RIGHTS & INCLUSION COMMITTEE 0 0 0 0 1,600 1,600 100.00%TRAVEL ALLOWANCE 0 0 68 0 0 0 0.00%MILEAGE REIMBURSEMENT 129 609 62 500 500 0 0.00%CONFERENCE FEES 1,250 932 484 2,500 2,500 0 0.00%DUES AND MEMBERSHIPS 787 1,056 435 484 484 0 0.00%TOTAL OPERATING EXPENSES 22,621 21,351 20,387 47,359 48,959 1,600 3.38%

TOTAL HUMAN RESOURCES 151,460 145,275 163,082 239,527 252,482 12,955 5.41%

HUMAN RESOURCES

38

TOWN CLERK


Maintain the vital statistics for the Town, the annual census, including dog licenses, and process all licenses and permits authorized by the Select Board

Compile the Town Meeting minutes and certifications

Maintain Board of Appeals and Planning Board filings and certifications

Oversee all local, state, and federal elections held in the Town

Function as Public Records Access Officer and assist with Open Meeting LawCompliance

Parking Ticket Hearings Officer

BUDGET COMMENTARY The former Administrative Services budget has been split into the Treasurer/Collector budget and new Town Clerk budget. Overall, the combined budgets are increasing by roughly 5%. In FY2022, there will be one election, which is reflected in the budget.

FISCAL YEAR 2021 ACCOMPISHMENTS

Completed a successful 2020 Presidential Election Cycle, State Primary, and local elections during pandemic (3 elections)

Purchased and implemented three new Poll Pad voting devices for use during early voting

Transitioned to Poll Pad technology for attendance at Special Town Meeting

Obtained $10,707 grant for planning and operationalizing safe and secure election administration


Continued automation of election administration

Prepare for re‐districting of precinct lines based on resultsof the 2020 Federal Census “Complete Count”

Town Clerk FTE FY2020 FY2021 FY2022

Director of Administrative Services DH DH DH

Town Clerk ‐ ‐ 1.00

Assistant Town Clerk 1.00 1.00 ‐

Accounting Clerk 1.50 1.50 1.50

Switchboard/Receptionists (2) 1.00 1.00 1.00

Parking Clerk Officer 0.50 0.50 0.50

Total 4.00 4.00 4.00

39


S&W PERMANENT‐FULL TIME 0 0 0 0 137,294 137,294 100.00%S&W PERMANENT ‐ PART TIME 0 0 0 0 84,189 84,189 100.00%S&W ‐ TEMPORARY POSITIONS 0 0 0 0 19,414 19,414 100.00%S&W ‐ APPOINTED POSITIONS 0 0 0 0 600 600 100.00%S&W ‐ ELECTION WORKERS 0 0 0 0 8,240 8,240 100.00%OVERTIME 0 0 0 0 2,500 2,500 100.00%LONGEVITY 0 0 0 0 2,150 2,150 100.00%SICK LEAVE INCENTIVE 0 0 0 0 1,175 1,175 100.00%TOTAL SALARIES & WAGES 0 0 0 0 255,562 255,562 100.00%

OFFICE EQUIPMENT MAINTENANCE 0 0 0 0 8,800 8,800 100.00%SOFTWARE MAINTENANCE 0 0 0 0 3,100 3,100 100.00%BOOK BINDING 0 0 0 0 1,000 1,000 100.00%PRINTING (NON‐FORMS) 0 0 0 0 3,100 3,100 100.00%GENERAL OFFICE SUPPLIES 0 0 0 0 3,000 3,000 100.00%FORMS PRINTING 0 0 0 0 10,000 10,000 100.00%FURNITURE & OFFICE EQUIP. 0 0 0 0 400 400 100.00%PARKING CLERK SUPPLIES 0 0 0 0 2,000 2,000 100.00%MILEAGE REIMBURSEMENT 0 0 0 0 125 125 100.00%CONFERENCE FEES 0 0 0 0 2,000 2,000 100.00%PARKING, TOLLS, ETC. 0 0 0 0 100 100 100.00%DUES AND MEMBERSHIPS 0 0 0 0 500 500 100.00%TUITION REIMBURSEMENT 0 0 0 0 6,000 6,000 100.00%TOTAL OPERATING EXPENSES 0 0 0 0 40,125 40,125 100.00%

TOTAL TOWN CLERK 0 0 0 0 295,687 295,687 100.00%

TOWN CLERK

40

POLICE DEPARTMENT

DEPARTMENT DESCRIPTION The Danvers Police Department is a community service law enforcement organization striving to maintain the safety of its citizens and focused on quality‐of‐life issues and the resolution of conflict within our community. The core values that the department relies on to deliver quality police services include:

Maintain high standards of integrity and ethics

Protect constitutional rights

Solve problems and maintain order

Collaborate and partner with citizens

Reduce crime and fear of crime

Protect vulnerable populations

BUDGET COMMENTARY The FY2022 budget represents a 2.68% increase over the prior year. Salaries & Wages will increase primarily due to contractual obligations. Operating expenses will increase due to costs associated with filling vacancies through recruitment & selection, and accreditation expenses. FISCAL YEAR 2021 ACCOMPLISHMENTS

Two new Patrol Officers graduated the academy, were appointed, completed their field training, and successfully transitioned into their area assignments.

Department completed 3rd Annual CALEA Accreditation Assess‐ment ensuring compliance with “Gold Standard in Public Safety.”

Members of the department who actively worked during the pan‐demic were commended for their superior performance in the ex‐ecution of their duties during a time of change and uncertainty.


Focus on selection efforts for promotions and ensuring the suc‐cessful transition of personnel into leadership positions

To actively initiate positive interactions with the community to build strong relationships of mutual trust

Police Department FTE FY2020 FY2021 FY2022

Police Chief DH DH DH

Captains 2.00 2.00 2.00

Lieutenants 3.00 3.00 3.00

Sergeants 8.00 8.00 8.00

Patrol Officers 33.00 33.00 33.00

Civilian Dispatchers 9.00 9.00 9.00

Civilian Crime Analyst 1.00 1.00 1.00

Senior Admin. Assistant 1.00 1.00 1.00

Records & Billings Staff 1.50 1.50 1.50

Total 58.50 58.50 58.50

41


S&W PERMANENT‐FULL TIME 3,524,053 3,544,429 3,719,752 4,137,455 4,326,684 189,229 4.57%S&W PERMANENT ‐ PART TIME 22,268 22,636 7,683 23,694 24,398 704 2.97%S&W ‐ TEMPORARY POSITIONS 14,139 12,853 15,623 10,608 10,608 0 0.00%OVERTIME 1,061,420 1,072,845 979,163 1,100,960 1,074,180 ‐26,780 ‐2.43%HOLIDAY 222,202 236,391 220,355 265,159 259,442 ‐5,717 ‐2.16%FLSA OVERTIME PREMIUM 574 456 211 0 0 0 0.00%NIGHT DIFFERENTIAL 145,928 147,776 154,253 190,024 192,885 2,861 1.51%WEEKEND DIFFERENTIAL 4,726 4,779 5,146 5,600 5,824 224 4.00%LONGEVITY 34,974 32,339 33,275 36,325 42,716 6,391 17.59%EDUCATIONAL INCENTIVE 514,640 523,985 563,401 537,046 554,299 17,253 3.21%SICK LEAVE INCENTIVE 24,275 29,300 15,925 37,200 24,050 ‐13,150 ‐35.35%SPECIALIST PAY 34,477 36,871 40,155 57,697 59,486 1,789 3.10%EMT INCENTIVE 14,000 10,800 12,000 12,000 12,000 0 0.00%CLEANING ALLOWANCES 6,352 6,948 6,972 6,796 7,536 740 10.89%TOTAL SALARIES & WAGES 5,624,028 5,682,408 5,773,914 6,420,564 6,594,108 173,544 2.70%

COMPUTER MAINTENANCE 3,000 0 0 0 0 0 0.00%VEHICLE MAINTENANCE 22,577 22,821 16,588 20,000 20,000 0 0.00%RADIO MAINTENANCE 8,597 13,473 9,963 20,000 20,096 96 0.48%PHOTOCOPIER MAINTENANCE 1,148 1,104 1,728 2,300 2,300 0 0.00%SOFTWARE MAINTENANCE 19,129 22,138 20,257 19,782 22,782 3,000 15.17%TRAINING SERVICES 24,769 21,935 13,911 25,000 25,000 0 0.00%RECRUITMENT & SELECTION 17,835 24,151 10,243 11,000 18,900 7,900 71.82%TELEPHONE 36,541 33,185 32,806 46,000 43,200 ‐2,800 ‐6.09%ACCREDITATION 19,955 10,723 12,486 13,100 19,195 6,095 46.53%GENERAL OFFICE SUPPLIES 16,943 15,213 13,618 15,900 15,900 0 0.00%COMPUTER SUPPLIES 4,692 11,985 7,938 13,800 13,800 0 0.00%FORMS PRINTING 2,721 1,276 1,310 2,600 2,700 100 3.85%FURNITURE & OFFICE EQUIP. 16,107 5,723 1,607 8,450 8,450 0 0.00%GASOLINE ‐ UNLEADED 48,225 70,454 58,712 90,420 86,120 ‐4,300 ‐4.76%TIRES AND TUBES 7,011 5,302 6,924 9,000 9,000 0 0.00%AMMUNITION 10,189 15,604 16,567 17,095 17,095 0 0.00%CROSSING GUARD UNIFORMS 1,000 259 1,000 1,000 1,000 0 0.00%PROTECTIVE CLOTHING 916 5,956 3,874 4,600 4,600 0 0.00%UNIFORMS 36,358 39,871 36,621 41,300 41,300 0 0.00%PHOTOGRAPHY SUPPLIES 7,734 3,011 5,188 5,500 5,500 0 0.00%POLICE/CP SUPPLIES 33,143 24,218 27,430 26,800 26,900 100 0.37%MISCELLANEOUS SUPPLIES 5,588 2,297 1,767 4,000 4,000 0 0.00%MILEAGE REIMBURSEMENT 1,081 2,974 2,673 3,000 3,000 0 0.00%MEALS 1,788 0 326 1,600 1,600 0 0.00%CONFERENCE FEES 5,578 4,188 3,418 6,000 6,000 0 0.00%PARKING, TOLLS, ETC. 78 305 330 250 350 100 40.00%DUES AND MEMBERSHIPS 10,102 12,767 11,322 16,189 16,189 0 0.00%TUITION REIMBURSEMENT 10,415 4,731 7,070 7,000 7,000 0 0.00%TOTAL OPERATING EXPENSES 373,220 375,664 325,677 431,686 441,977 10,291 2.38%

TOTAL POLICE 5,997,248 6,058,072 6,099,591 6,852,250 7,036,085 183,835 2.68%

POLICE

42

FIRE DEPARTMENT

DEPARTMENT DESCRIPTION The mission of the Danvers Fire Department is to protect the lives and property of citizens and visitors from the adverse effects of fire, medical emergencies, and exposure to dangerous conditions stemming from manmade or natural disasters. In addition, the Department is called upon to:

Respond to emergency and non‐emergency calls for assistance

Conduct quarterly and annual building inspections

Conduct building plan reviews for construction & renovation projects

Enforce 527 CMR 1, Massachusetts Comprehensive Fire Safety Code

Conduct public fire safety education in our schools and Senior Center

Assist other Town departments with fire safety and code issues

BUDGET COMMENTARY Contractual adjustments in salaries and wages, increased costs for software maintenance, sick‐leave buyback, tuition reimbursement, and an attempt to more accurately budget for Overtime costs account for most of the budget increase for FY2022.


Awarded EMP Grant of $6,500 to help offset the cost of new set of “Jaws”

Awarded $210,000 AFG grant for purchase of new departmental portable radios (whichwas a FY2021 strategic goal)


Purchase new Fire Prevention vehicle

Complete the purchase of new state‐of‐the‐art portable radios utilizing AFG award andcapital outlay

Explore grant opportunities with Town Manager (e.g. FEMA’s SAFER grant) to bring staff‐ing back to pre‐Great Recession levels

Acquire funding through grant opportunities to purchase permitting software programto connect with Inspectional Services and Health Department to streamline permittingprocess

Fire Department FTE FY2020 FY2021 FY2022

Fire Chief DH DH DH

Deputy Fire Chief 1.00 1.00 1.00

Fire Prevention Officer 1.00 1.00 1.00

Captains 4.00 4.00 4.00

Lieutenants 12.00 12.00 12.00

Firefighters 30.00 30.00 30.00


Total 48.87 48.94 48.94

43


S&W PERMANENT‐FULL TIME 3,343,783 3,448,776 3,493,307 3,601,634 3,758,009 156,375 4.34%OVERTIME 887,696 626,598 630,588 597,876 638,666 40,790 6.82%HOLIDAY 212,010 216,013 224,045 215,401 234,010 18,609 8.64%NIGHT DIFFERENTIAL 259,563 252,017 259,581 267,094 278,925 11,831 4.43%LONGEVITY 23,851 26,884 26,561 29,711 27,221 ‐2,490 ‐8.38%OUT OF RANGE 3,205 6,431 8,610 7,500 8,000 500 6.67%EDUCATIONAL INCENTIVE 78,212 80,906 89,629 85,056 97,256 12,200 14.34%SICK LEAVE BUY‐BACK (FIRE DEPT) 82,872 53,588 7,606 36,140 82,311 46,171 127.76%SICK LEAVE INCENTIVE 7,616 8,166 6,036 8,625 8,700 75 0.87%EMT INCENTIVE 141,100 143,922 144,030 146,924 146,924 0 0.00%CLEANING ALLOWANCES 600 600 0 300 600 300 100.00%TRAFFIC CONTROL 1,258 2,271 3,169 5,000 5,000 0 0.00%TOTAL SALARIES & WAGES 5,041,766 4,866,173 4,893,161 5,001,261 5,285,622 284,361 5.69%

OFFICE EQUIPMENT MAINTENANCE 0 0 0 800 800 0 0.00%TERMINAL/PRINTER MAINTENANCE 432 311 295 800 800 0 0.00%VEHICLE MAINTENANCE 38,087 58,131 50,571 55,000 55,000 0 0.00%RADIO MAINTENANCE 11,585 4,908 8,797 13,014 12,000 ‐1,014 ‐7.79%SOFTWARE MAINTENANCE 13,307 14,162 15,896 15,500 19,450 3,950 25.48%TOOL & EQUIP MAINTENANCE 16,082 21,198 19,690 18,330 18,000 ‐330 ‐1.80%MEDICAL EXPENSES 1,720 2,810 198 0 0 0 0.00%TRAINING SERVICES 14,526 997 9,461 10,000 10,000 0 0.00%TELEPHONE 7,743 6,596 7,110 9,270 10,000 730 7.87%FITNESS CLUB MEMBERSHIPS 3,750 4,000 3,750 4,250 4,250 0 0.00%SAFETY SERVICES 2,381 1,471 1,679 2,500 2,500 0 0.00%GENERAL OFFICE SUPPLIES 2,979 3,687 1,772 3,500 3,500 0 0.00%SOFTWARE 311 0 0 0 0 0 0.00%FORMS PRINTING 462 927 1,002 1,000 1,000 0 0.00%FURNITURE & OFFICE EQUIP. 719 419 1,231 3,000 3,000 0 0.00%MEDICAL SUPPLIES 10,934 12,786 9,038 15,500 17,000 1,500 9.68%TOOLS AND EQUIPMENT 22,278 27,825 20,563 24,112 24,000 ‐112 ‐0.46%GASOLINE ‐ UNLEADED 1,722 2,192 1,596 2,877 4,752 1,875 65.17%GASOLINE ‐ DIESEL 19,818 25,473 21,831 33,330 26,910 ‐6,420 ‐19.26%PROTECTIVE CLOTHING 5,974 9,512 9,056 13,500 20,000 6,500 48.15%UNIFORMS 28,982 29,340 26,700 31,225 31,225 0 0.00%FIRE ALARM SUPPLIES 6,300 6,890 9,000 7,000 7,000 0 0.00%HOSE 4,899 5,510 2,890 5,000 5,000 0 0.00%FIRE SUPPLIES 573 3,755 3,114 4,000 4,000 0 0.00%PROVISIONS 865 180 0 800 800 0 0.00%MISCELLANEOUS SUPPLIES 175 1,306 1,249 2,750 2,500 ‐250 ‐9.09%MILEAGE REIMBURSEMENT 2,774 2,986 445 2,775 2,800 25 0.90%CONFERENCE FEES 2,537 3,033 3,344 4,000 4,000 0 0.00%DUES AND MEMBERSHIPS 4,109 1,413 3,465 4,500 4,500 0 0.00%SUBSCRIPTIONS 1,220 786 439 1,000 1,000 0 0.00%TUITION REIMBURSEMENT 41,434 12,577 28,682 35,000 77,472 42,472 121.35%TOTAL OPERATING EXPENSES 268,678 265,183 262,864 324,333 373,259 48,926 15.09%

TOTAL FIRE 5,310,444 5,131,356 5,156,025 5,325,594 5,658,881 333,287 6.26%

FIRE

44

PUBLIC WORKS (TAX SUPPORTED)


Maintain and provide a safe, clean environment in all Town‐owned buildings, including Schools

Maintain and improve 150 acres of grounds and playing fields, including trash removal, lawn mowing, technical turf care and pest control, fence maintenance, equipment and facility maintenance, general landscaping, and playground safety

Maintain and repair more than 250 pieces of equipment used in Public Works, Rec‐reation, Inspectional Services, Planning, Senior Center, Schools, and Police

Maintain 120 miles of roadway, including sweeping, resurfacing, regulatory sign‐age, snow, and ice control, refuse collection, disposal, and recycling

Provide engineering support and oversight to various utility projects, maintain GIS databases and mapping, provide technical review and assis‐tance to various Town departments and committees

BUDGET COMMENTARY

The Public Works tax‐supported budget reflects a 0.66% increase, including increases to refuse collection/disposal, contract cleaning, and pavement striping which are offset by decreases in snow & ice operations based on recent trends.


Completed renovation of Gates Athletic Fields

Completed major improvements to 12 Sylvan Street

Resurfaced 3.5 miles of roadway and over 10,000 feet of sidewalks


Complete the Smith School project; set to open in September 2021

Continue needs assessment & location study related to a new DPWfacility

Full utilization of Fleet maintenance software and roll out to all Townof Danvers Departments

Construction of Rail Trail bridge over Beaver Brook

Perform updates and improvements to the Dog Park

Public Works (Tax) FTE FY2020 FY2021 FY2022

Engineering 4.00 4.00 4.00

Street 15.00 15.00 15.00

Equipment 6.00 6.00 6.00

Buildings 26.70 26.70 26.70

Grounds & Forestry 10.00 10.00 10.00

Public Works Administration 3.00 3.00 3.00

64.70 64.70 64.70

45


S&W PERMANENT‐FULL TIME 3,497,410 3,458,052 3,563,817 3,759,219 3,897,137 137,918 3.67%S&W PERMANENT ‐ PART TIME 51,929 29,107 57,394 63,060 63,100 40 0.06%S&W ‐ TEMPORARY POSITIONS 118,239 137,375 129,265 178,998 172,771 ‐6,227 ‐3.48%OVERTIME 343,982 323,280 276,245 346,073 350,761 4,688 1.35%OVERTIME ‐ ICE AND SNOW 273,751 198,697 123,302 244,746 210,334 ‐34,412 ‐14.06%FLSA OVERTIME PREMIUM 1,781 1,522 5,711 2,100 2,200 100 4.76%NIGHT DIFFERENTIAL 22,914 23,813 23,214 25,200 25,600 400 1.59%LONGEVITY 29,100 29,175 30,425 33,925 35,325 1,400 4.13%OUT OF RANGE 3,187 4,472 4,836 3,823 5,100 1,277 33.40%MEALS ALLOWANCE 8,984 8,020 6,250 7,950 7,900 ‐50 ‐0.63%ON CALL ‐ PUBLIC WORKS 15,639 16,050 16,378 22,812 22,812 0 0.00%SICK LEAVE INCENTIVE 10,441 9,929 9,697 11,775 11,325 ‐450 ‐3.82%TRAFFIC CONTROL 64,541 72,624 61,750 54,000 54,000 0 0.00%TOTAL SALARIES & WAGES 4,441,898 4,312,116 4,308,284 4,753,681 4,858,365 104,684 2.20%

ELECTRICITY 919,197 891,312 711,968 986,178 986,178 0 0.00%ELECTRICITY ‐ STREET LIGHTS 107,976 108,058 108,058 107,765 108,000 235 0.22%ELECTRICITY ‐ TRAFFIC SIGNALS 21,934 22,792 21,976 22,494 22,500 6 0.03%OIL ‐ HEATING 113,080 127,290 96,410 148,830 125,113 ‐23,717 ‐15.94%GAS ‐ HEATING 352,271 346,969 314,343 375,368 392,957 17,589 4.69%PROPANE 4,782 6,000 5,000 5,000 5,000 0 0.00%EMERGENCY GENERATOR 8,363 10,993 6,475 8,400 8,400 0 0.00%WATER 108,230 123,841 137,547 125,398 126,202 804 0.64%OFFICE EQUIPMENT MAINTENANCE 0 0 145 1,000 1,000 0 0.00%VEHICLE MAINTENANCE 15,613 11,898 26,804 25,000 25,000 0 0.00%PLUMBING MAINT. ‐ CONTRACTUAL 32,572 39,515 58,603 40,000 40,000 0 0.00%HEATING MAINT. ‐ CONTRACTUAL 92,462 30,736 94,352 70,000 70,000 0 0.00%ELECTRICAL MAINT.‐CONTRACTUAL 8,420 9,030 14,593 15,000 15,000 0 0.00%ELEVATOR MAINTENANCE 44,341 53,449 59,236 50,000 50,000 0 0.00%PAINTING ‐ CONTRACTUAL 5,429 7,951 6,094 12,000 12,000 0 0.00%SECURITY SYSTEM MAINTENANCE 19,924 19,821 21,808 36,400 36,400 0 0.00%SOFTWARE MAINTENANCE 6,845 6,949 6,845 10,000 10,000 0 0.00%H.V.A.C. MAINTENANCE 270,340 300,601 239,598 335,000 335,000 0 0.00%CARPENTRY MAINT. ‐ CONTRACTUAL 10,052 4,567 0 20,000 20,000 0 0.00%EQUIPMENT RENTAL 9,549 10,189 9,802 11,000 11,000 0 0.00%REFUSE COLLECTION 634,261 634,647 653,364 653,367 673,040 19,673 3.01%REFUSE DISPOSAL 420,980 429,677 418,919 496,718 515,731 19,013 3.83%SNOW REMOVAL EQUIPMENT 391,903 244,799 173,849 398,263 320,074 ‐78,189 ‐19.63%CONTRACT CLEANING 744,901 777,192 810,497 813,076 840,284 27,208 3.35%FERTILIZATION PROGRAM 28,700 37,750 28,600 37,900 37,900 0 0.00%GASOLINE PUMP TESTING 3,981 4,204 1,318 5,000 5,000 0 0.00%FENCES ‐ CONTRACTUAL 23,040 15,855 14,410 15,000 15,000 0 0.00%CONTRACT TRIMMING 7,500 10,000 38,438 12,000 12,000 0 0.00%HAZARDOUS WASTE REMOVAL 18,581 22,759 20,997 27,000 27,000 0 0.00%PAVEMENT STRIPING 60,806 55,420 60,623 62,000 84,000 22,000 35.48%CONTRACT MOWING 54,992 67,105 80,422 63,000 63,000 0 0.00%RECYCLING 261,886 207,662 219,326 201,121 207,680 6,559 3.26%CONTRACT SWEEPING 25,067 22,597 19,987 24,000 24,000 0 0.00%CONTRACT TREE REMOVAL 24,500 15,751 20,000 20,000 20,000 0 0.00%


46


YARD WASTE REMOVAL 24,459 24,005 24,760 24,000 24,000 0 0.00%AERATION 6,375 16,178 16,500 16,568 16,568 0 0.00%MEDICAL EXAMS (EMPLOYEE) 328 75 455 0 0 0 0.00%LABRATORY TESTING 0 0 0 2,000 0 ‐2,000 ‐100.00%CONSULTING SERVICES 20,000 0 0 5,000 5,000 0 0.00%LANDFILL CONSULTANT 52,301 73,119 69,909 72,150 72,150 0 0.00%ENGINEERING CONSULTANTS 475 3,757 1,125 4,000 7,800 3,800 95.00%TRAINING SERVICES 9,718 10,112 11,312 21,650 19,745 ‐1,905 ‐8.80%INSPECTIONAL SERVICES 30,487 28,365 30,618 43,000 43,000 0 0.00%TELEPHONE 27,840 28,536 28,852 29,020 26,725 ‐2,295 ‐7.91%PRINTING (NON‐FORMS) 2,019 784 2,320 2,000 2,100 100 5.00%FITNESS CLUB MEMBERSHIPS 1,349 1,659 1,125 1,250 1,250 0 0.00%WEATHER SERVICES 1,495 1,695 1,695 1,700 1,700 0 0.00%SAFETY SERVICES 1,643 1,374 1,941 1,750 1,750 0 0.00%FEDERALLY REQUIRED TESTING 2,790 1,244 2,075 3,150 3,150 0 0.00%VEHICLE INSPECTIONS 9,525 10,815 7,875 11,300 11,300 0 0.00%GENERAL OFFICE SUPPLIES 4,849 6,224 6,875 8,300 8,300 0 0.00%PHOTOCOPY SUPPLIES 0 0 0 300 300 0 0.00%GRAPHIC SUPPLIES 0 0 0 100 100 0 0.00%COMPUTER SUPPLIES 0 0 0 400 400 0 0.00%SOFTWARE 4,820 14,213 36,250 34,489 24,620 ‐9,869 ‐28.61%FURNITURE & OFFICE EQUIP. 4,556 1,179 203 4,000 4,000 0 0.00%COMPUTER HARDWARE, ETC 2,485 2,214 5,557 8,000 7,500 ‐500 ‐6.25%LUMBER AND HARDWARE 27,661 27,820 27,526 41,000 42,000 1,000 2.44%PLUMBING SUPPLIES 2,042 4,500 4,686 7,500 7,500 0 0.00%ELECTRICAL SUPPLIES 11,081 7,080 10,411 10,000 10,500 500 5.00%GLASS 1,751 3,931 12,724 6,500 6,500 0 0.00%HEATING SUPPLIES 652 0 1,508 4,000 4,000 0 0.00%LAMPS 5,422 10,099 10,319 12,500 12,500 0 0.00%PAINT 5,806 6,744 6,138 7,000 7,000 0 0.00%ROOF REPAIR 9,607 17,769 8,150 24,000 24,000 0 0.00%TOOLS AND EQUIPMENT 0 0 0 1,000 1,000 0 0.00%DTAC SUPPLIES 0 0 0 4,000 4,000 0 0.00%RECYCLING SUPPLIES 0 0 0 5,000 5,000 0 0.00%CUSTODIAL SUPPLIES 109,564 116,214 97,256 115,500 115,500 0 0.00%GROUNDS SUPPLIES‐TOWN 13,690 26,657 23,858 23,000 23,000 0 0.00%SCHOOL GROUND SUPPLIES 22,906 21,678 25,539 25,000 25,000 0 0.00%WEED MATERIAL 0 953 659 1,000 1,000 0 0.00%BEACH SAND 1,682 0 0 0 0 0 0.00%IRRIGATION SUPPLIES 9,202 4,492 7,081 8,000 8,000 0 0.00%TREES AND SHRUBS 343 645 608 2,000 2,000 0 0.00%CHEMICALS/INSECTICIDES 0 0 0 500 500 0 0.00%PLANTING MATERIALS 3,417 3,124 847 3,500 3,500 0 0.00%TOOLS AND EQUIPMENT 11,176 9,333 10,074 13,500 13,500 0 0.00%ENDICOTT PARK MAINTENANCE 32,277 0 0 0 0 0 0.00%NEW TREES 9,590 9,960 9,325 11,000 11,000 0 0.00%ATHLETIC FIELDS SODDING 15,944 24,525 23,318 23,000 24,000 1,000 4.35%PLAYGROUND EQUIPMENT REPAIRS 6,915 0 0 0 0 0 0.00%


47


GASOLINE ‐ UNLEADED 59,329 78,009 36,588 67,278 64,213 ‐3,065 ‐4.56%GASOLINE ‐ DIESEL 40,155 48,096 37,711 50,299 45,980 ‐4,319 ‐8.59%TIRES AND TUBES 12,980 11,613 16,590 24,000 24,000 0 0.00%OTHER AUTO SUPPLIES 96,814 98,487 93,066 113,400 113,400 0 0.00%OIL 20,081 18,601 13,916 25,000 25,000 0 0.00%BODY REPAIRS 5,487 5,852 3,961 10,000 10,000 0 0.00%PLOW REPAIRS 30,082 26,992 18,094 32,000 32,000 0 0.00%MECHANICS TOOLS 2,635 2,400 3,061 3,000 3,000 0 0.00%BITUMINOUS CONCRETE 105,677 66,609 110,040 120,000 120,000 0 0.00%DRAINAGE SUPPLIES 18,771 26,828 20,107 25,000 30,000 5,000 20.00%TRAFFIC SUPPLIES 20,254 30,124 19,574 30,000 30,000 0 0.00%GRAVEL 5,175 6,512 7,338 10,000 10,000 0 0.00%WINTER CHEMICALS 260,800 192,243 159,169 215,978 190,006 ‐25,972 ‐12.03%SAND 0 1,359 2,020 1,500 1,500 0 0.00%SAFETY EQUIPMENT 7,691 4,670 6,542 8,000 8,000 0 0.00%PROTECTIVE CLOTHING 1,569 1,857 1,719 2,000 2,000 0 0.00%UNIFORMS 48,239 48,845 50,158 52,300 52,300 0 0.00%TOOLS AND EQUIPMENT 12,694 7,544 12,729 14,700 14,700 0 0.00%MISCELLANEOUS SUPPLIES 0 0 262 400 400 0 0.00%BOOKS 0 0 0 100 100 0 0.00%PERMITS/LICENSES 11,969 7,025 9,109 14,475 13,225 ‐1,250 ‐8.64%TRAVEL ALLOWANCE 2,700 1,200 2,075 2,700 2,700 0 0.00%MILEAGE REIMBURSEMENT 3,917 4,198 3,265 4,800 4,800 0 0.00%CONFERENCE FEES 326 50 0 1,000 1,000 0 0.00%PARKING, TOLLS, ETC. 123 42 0 100 100 0 0.00%DUES AND MEMBERSHIPS 3,025 2,517 3,531 6,099 6,199 100 1.64%SUBSCRIPTIONS 139 118 123 250 150 ‐100 ‐40.00%SUPPORT SERVICES 70,156 64,180 58,463 71,559 71,559 0 0.00%MISC OTHER CHARGES & EXPENSES 144 385 470 1,200 1,000 ‐200 ‐16.67%LICENSES‐CDL,HOISTING,ETC. 940 2,104 1,119 4,675 4,675 0 0.00%TOTAL OPERATING EXPENSES 6,202,592 5,956,911 5,720,681 6,787,718 6,758,924 ‐28,794 ‐0.42%

TOTAL PUBLIC WORKS TAX SUPPORTED 10,644,490 10,269,027 10,028,965 11,541,399 11,617,289 75,890 0.66%


48

PUBLIC WORKS (SEWER & WATER DIVISIONS) DIVISION DESCRIPTION

Maintain 125 miles of sanitary sewer, 15 pump stations, and 8,249 sewer connections

Maintain 155 miles of water distribution main, 1,597 hydrants, and 5 booster stations

Distribute quality drinking water to 10,212 customers (meters) in the distribution system BUDGET COMMENTARY The Water and Sewer Division budgets increased by $292,802, or 1.99%. The increase includes contractual salary adjustments for staff as well as adjustments in certain expenses such as sludge removal. The largest increase, the SESD assessment, is a 2.5% placeholder, as we await the final FY2022 assessment number. FISCAL YEAR 2021 ACCOMPLISHMENTS

Completed Water Main replacement at Hobart Street and Centre Street crossing at Newbury Street.

Continued the Town wide Sewer Cleaning and Closed‐Circuit Television (CCTV) inspection of all sewer mains owned and maintained by the

Town.

Continued Sewer Rehabilitation Program

Rehabilitation of filtration system at Well #2

Frost Fish Brook Phase 2 bank stabilization FISCAL YEAR 2022 STRATEGIC GOALS

Continue the Water Distribution Capital Improvement Plan

Continue to implement recommended DEP counter measures for PFAS detection

Start the phase out of the Greenleaf Drive sewer pump‐ing station and transition of its sewer lines to existing gravity sewer

DPW Water & Sewer FTE FY2020 FY2021 FY2022

Sewer 3.00 4.00 4.00

Water Distribution 14.00 14.00 14.00

Water Treatment 8.00 8.00 8.00

25.00 26.00 26.00

49


S&W PERMANENT‐FULL TIME 217,746 204,612 156,587 260,047 270,785 10,738 4.13%S&W PERMANENT ‐ PART TIME 0 0 0 0 0 0 0.00%S&W ‐ TEMPORARY POSITIONS 0 0 8,902 8,750 8,750 0 0.00%OVERTIME 20,779 22,000 16,070 47,278 48,224 946 2.00%FLSA OVERTIME PREMIUM 19 31 21 200 200 0 0.00%LONGEVITY 450 575 0 588 138 ‐450 ‐76.53%OUT OF RANGE 297 954 1,672 1,200 1,200 0 0.00%MEALS ALLOWANCE 288 160 30 250 250 0 0.00%ON CALL ‐ SEWER DIVISION 0 208 0 600 600 0 0.00%SICK LEAVE INCENTIVE 575 575 650 1,050 1,700 650 61.90%WATER OPERATORS INCENTIVE 1,825 2,075 800 3,815 2,550 ‐1,265 ‐33.16%TRAFFIC CONTROL 855 1,110 423 4,475 4,475 0 0.00%TOTAL SALARIES & WAGES 242,834 232,300 185,154 328,253 338,872 10,619 3.24%

ELECTRICITY 25,772 30,000 32,500 35,200 32,000 ‐3,200 ‐9.09%GAS ‐ HEATING 1,321 1,633 2,059 1,995 1,995 0 0.00%VEHICLE MAINTENANCE 24,583 17,893 7,100 20,000 20,000 0 0.00%ELECTRICAL MAINT.‐CONTRACTUAL 1,730 9,000 1,000 10,000 10,000 0 0.00%PUMP MAINTENANCE 30,000 35,512 30,000 54,000 54,000 0 0.00%SOFTWARE MAINTENANCE 18,190 18,326 18,918 19,000 22,000 3,000 15.79%H.V.A.C. MAINTENANCE 0 749 2,500 9,017 2,500 ‐6,517 ‐72.27%TELEMETRY 11,234 15,146 12,296 15,000 15,000 0 0.00%EQUIPMENT RENTAL 2,454 10,423 1,952 12,000 12,000 0 0.00%CONTRACT CLEANING 27,144 25,294 29,977 30,207 31,036 829 2.74%EASEMENT MAINTENANCE 2,359 3,548 6,956 8,200 8,200 0 0.00%STORMWATER SERVICES 0 40,000 12,043 40,000 40,000 0 0.00%CATCH BASIN CLEANING 0 33,192 24,894 30,000 35,000 5,000 16.67%AUDITING SERVICES 3,900 4,020 3,300 4,100 4,000 ‐100 ‐2.44%LEGAL SERVICES 7,161 7,348 9,834 9,851 9,851 0 0.00%ENGINEERING CONSULTANTS 73,447 42,991 59,144 65,000 65,000 0 0.00%TRAINING SERVICES 3,349 580 1,289 6,250 6,250 0 0.00%FITNESS CLUB MEMBERSHIPS 0 250 250 250 250 0 0.00%FEDERALLY REQUIRED TESTING 170 400 155 0 0 0 0.00%GENERAL OFFICE SUPPLIES 446 114 250 1,000 1,000 0 0.00%SOFTWARE 10,601 7,914 13,041 25,000 25,000 0 0.00%COMPUTER HARDWARE, ETC 0 0 897 2,500 2,500 0 0.00%PUMP REPAIR 0 1,186 0 3,000 3,000 0 0.00%MISC. GROUNDS MAINTENANCE 6,906 715 1,880 8,000 8,000 0 0.00%GASOLINE ‐ UNLEADED 5,318 6,365 5,119 7,620 7,920 300 3.94%GASOLINE ‐ DIESEL 1,293 1,460 1,554 3,960 3,588 ‐372 ‐9.39%CHEMICALS ‐ OTHER 0 0 0 1,000 1,000 0 0.00%SEWER LATERAL MATERIALS 5,868 10,098 9,370 12,000 12,000 0 0.00%SAFETY EQUIPMENT 850 3,245 591 3,000 3,000 0 0.00%UNIFORMS 2,200 2,200 1,325 2,200 2,200 0 0.00%TOOLS AND EQUIPMENT 1,576 1,023 3,464 2,500 2,500 0 0.00%MISCELLANEOUS SUPPLIES 420 86 702 500 500 0 0.00%SOUTH ESSEX SEWERAGE DISTRICT 3,897,066 3,955,220 3,953,616 3,936,475 4,034,887 98,412 2.50%PERMITS/LICENSES 912 750 446 1,000 500 ‐500 ‐50.00%MILEAGE REIMBURSEMENT 0 0 12 0 0 0 0.00%

SEWER ENTERPRISE FUND

50


DUES AND MEMBERSHIPS 335 512 335 1,140 1,140 0 0.00%HEALTH & DENTAL COSTS 7,284 5,741 7,528 50,927 71,128 20,201 39.67%LIFE INSURANCE 0 0 0 140 140 0 0.00%MEDICARE/FICA INSURANCE 2,284 1,971 1,832 2,955 2,500 ‐455 ‐15.40%PENSION REIMBURSEMENTS 26,888 29,077 48,334 52,321 52,321 0 0.00%SUPPORT SERVICES 187,385 186,772 209,944 216,482 226,415 9,933 4.59%PAYMENTS IN LIEU OF TAXES 111,998 112,000 112,000 112,000 112,000 0 0.00%MISC OTHER CHARGES & EXPENSES 0 0 0 0 0 0 0.00%OUT OF STATE TRAVEL EXPENSES 0 431 729 5,283 5,283 0 0.00%TOTAL OPERATING EXPENSES 4,502,444 4,623,186 4,629,135 4,821,073 4,947,604 126,531 2.62%

TRANSFER TO ENTERPRISE FUNDS 150,000 150,000 150,000 150,000 150,000 0 0.00%TRANSFER TO UNEMPLOYMENT FUND 150 450 400 400 400 0 0.00%TRANSFER TO OPEB STABILIZATION 23,949 28,449 28,449 28,449 28,449 0 0.00%TOTAL INTERFUND TRANSFERS 174,099 178,899 178,849 178,849 178,849 0 0.00%

FROST FISH 8/19 0 0 0 15,000 15,000 0 0.00%ANDOVER ST SEWER 11/03 5,000 5,000 5,000 5,000 5,000 0 0.00%SEWER BOND 3/05 80,000 80,000 80,000 75,000 75,000 0 0.00%SEWER DRAINAGE 7/1/06 0 0 0 0 0 0 0.00%WASTEWATER 7/1/06 19,000 19,400 19,100 19,000 18,000 ‐1,000 ‐5.26%SEWER BONDS 7/15/97 0 0 0 0 0 0 0.00%SEWER BONDS 12/20/01 20,000 15,000 15,000 0 0 0 0.00%SEWER BONDS 7/15/99 60,000 58,750 60,000 0 0 0 0.00%SEWER DRAINAGE 7/08 35,000 35,000 34,000 35,000 30,000 ‐5,000 ‐14.29%WASTEWATER FAC. 07/08 10,000 10,000 10,000 10,000 10,000 0 0.00%SEWER 4/09 (rfdg) 0 0 0 0 0 0 0.00%SEWER DRAINAGE 07/10 170,000 135,000 135,000 0 0 0 0.00%SEWER DRAINAGE 07/11 25,000 25,000 25,000 25,000 25,000 0 0.00%FROST FISH BROOK DRAINAGE 5/16/16 0 42,000 40,000 40,000 35,000 ‐5,000 ‐12.50%SEWER BONDS #1 8/19 0 0 0 75,000 70,000 ‐5,000 ‐6.67%SEWER BONDS #2 8/19 0 0 0 90,000 90,000 0 0.00%SEWER BONDS 8/20 0 0 0 0 5,000 5,000 100.00%FROST FISH 8/20 0 0 0 0 5,000 5,000 100.00%INT‐ANDOVER ST SEWER 11/03 650 550 150 350 250 ‐100 ‐28.57%INT ‐ SEWER BONDS 3/05 11,400 9,800 8,200 6,650 5,150 ‐1,500 ‐22.56%INT SEWER DRAINAGE 7/1/06 0 0 0 0 0 0 0.00%INT‐WASTEWATER 7/1/06 3,544 3,160 2,679 2,108 1,643 ‐465 ‐22.06%INT ‐ SEWER BONDS 7/15/97 0 0 0 0 0 0 0.00%INT.‐ SEWER BONDS 12/20/01 800 450 450 0 0 0 0.00%INT ‐ SEWER BONDS 7/15/99 5,801 3,486 1,170 0 0 0 0.00%INT ‐ SEWER BONDS 12/14/00 0 0 0 0 0 0 0.00%INT ‐ SEWER DRAINAGE 7/08 11,580 10,180 8,800 7,420 6,120 ‐1,300 ‐17.52%INT‐WASTEWATER FAC 7/08 3,440 3,040 2,640 2,240 1,840 ‐400 ‐17.86%INT ‐ SEWER 4/09 (rfdg) 0 0 0 0 0 0 0.00%INT ‐ SEWER DRAINAGE 7/10 17,750 10,125 3,375 0 0 0 0.00%INT ‐ SEWER DRAINAGE 07/11 12,113 11,363 10,519 9,675 8,925 ‐750 ‐7.75%INT ‐ FROST FISH BROOK DRAINAGE 5/16/16 0 44,680 27,500 25,500 23,625 ‐1,875 ‐7.35%


51


INT ‐ SEWER BONDS #1 8/19 0 0 0 39,375 22,000 ‐17,375 ‐44.13%INT ‐ SEWER BONDS #2 8/19 0 0 0 57,750 33,250 ‐24,500 ‐42.42%INT ‐ FROST FISH 8/19 0 0 0 13,500 8,125 ‐5,375 ‐39.81%INT ‐ SEWER BONDS 8/20 0 0 0 0 53,409 53,409 100.00%INT ‐ FROST FISH 8/20 0 0 0 0 58,762 58,762 100.00%INTEREST ON TEMPORARY LOANS 0 0 53,850 50,000 50,000 0 0.00%TOTAL DEBT 491,078 521,983 542,433 603,568 656,099 52,531 8.70%

CAPITAL OUTLAY ‐ REPLACE. EQ. 119,284 125,167 119,451 55,000 64,000 9,000 16.36%TOTAL CAPITAL 119,284 125,167 119,451 55,000 64,000 9,000 16.36%

TOTAL SEWER 5,529,739 5,900,858 5,655,023 5,986,743 6,185,424 198,681 3.32%


52


S&W PERMANENT‐FULL TIME 1,360,927 1,401,871 1,453,948 1,618,688 1,642,696 24,008 1.48%S&W ‐ TEMPORARY POSITIONS 17,521 26,676 19,212 48,160 51,870 3,710 7.70%OVERTIME 258,001 235,288 279,297 269,123 271,428 2,305 0.86%FLSA OVERTIME PREMIUM 1,946 1,805 3,083 3,500 3,500 0 0.00%NIGHT DIFFERENTIAL 11,939 13,446 10,951 14,000 14,000 0 0.00%LONGEVITY 8,900 9,475 10,375 11,663 11,713 50 0.43%OUT OF RANGE 1,796 1,947 3,885 2,970 2,900 ‐70 ‐2.36%MEALS ALLOWANCE 5,902 5,445 5,710 5,600 5,500 ‐100 ‐1.79%ON CALL ‐ WATER DIVISION 15,556 16,059 16,463 16,519 20,260 3,741 22.65%SICK LEAVE INCENTIVE 2,775 575 250 8,025 10,875 2,850 35.51%WATER OPERATORS INCENTIVE 18,750 21,700 20,800 31,375 24,400 ‐6,975 ‐22.23%TRAFFIC CONTROL 18,791 25,415 14,810 22,372 22,372 0 0.00%TOTAL SALARIES & WAGES 1,722,804 1,759,702 1,838,784 2,051,995 2,081,514 29,519 1.44%

ELECTRICITY 347,767 311,519 304,317 434,750 436,650 1,900 0.44%GAS ‐ HEATING 45,386 49,482 42,376 52,800 52,800 0 0.00%PROPANE 6,345 3,797 2,169 6,500 7,060 560 8.62%VEHICLE MAINTENANCE 33,014 23,899 24,042 50,000 50,000 0 0.00%WELL MAINTENANCE CONTRACT 0 47,380 0 22,000 22,000 0 0.00%PUMP MAINTENANCE 77,728 92,169 37,247 70,000 70,000 0 0.00%SECURITY SYSTEM MAINTENANCE 936 250 250 2,000 1,000 ‐1,000 ‐50.00%SOFTWARE MAINTENANCE 74,590 51,432 45,394 84,600 84,600 0 0.00%H.V.A.C. MAINTENANCE 0 7,953 13,522 9,017 9,017 0 0.00%OTHER CONTRACT MAINTENANCE 42,964 27,548 30,847 40,000 40,000 0 0.00%EQUIPMENT RENTAL 17,405 24,311 0 15,000 15,000 0 0.00%BUILDING RENTAL 1,800 1,800 1,650 1,800 1,800 0 0.00%SLUDGE REMOVAL 75,630 110,358 124,215 90,000 100,000 10,000 11.11%CONTRACT CLEANING 27,144 25,294 29,977 45,723 47,884 2,161 4.73%EASEMENT MAINTENANCE 2,009 2,715 2,490 5,000 5,000 0 0.00%WATER MAIN REPAIR CONTRACT 19,001 12,000 12,000 40,000 40,000 0 0.00%METER TESTING CONTRACT 5,403 7,159 8,000 8,000 8,000 0 0.00%WATERSHED CONTRACTAUL SERVICES 4,367 4,735 4,200 5,000 5,000 0 0.00%WATER CONSERVATION PROGRAM 1,094 1,130 1,085 0 0 0 0.00%CROSS CONNECT SURVEY & TESTING 39,026 37,118 35,006 40,000 40,000 0 0.00%CONSULTING SERVICES 90,110 89,114 68,887 130,000 130,000 0 0.00%AUDITING SERVICES 3,900 4,020 3,300 4,350 4,600 250 5.75%LEGAL SERVICES 7,161 7,348 9,834 31,713 20,000 ‐11,713 ‐36.93%BANKING SERVICES 40,885 37,724 48,677 36,000 36,000 0 0.00%TRAINING SERVICES 9,011 11,297 5,814 21,625 21,625 0 0.00%TELEPHONE 20,220 23,465 25,448 23,000 23,000 0 0.00%POSTAGE 24,477 23,331 22,066 25,000 25,000 0 0.00%PRINTING (NON‐FORMS) 0 0 85 0 0 0 0.00%FITNESS CLUB MEMBERSHIPS 1,099 875 599 1,125 750 ‐375 ‐33.33%FEDERALLY REQUIRED TESTING 27,077 29,814 17,568 30,633 31,133 500 1.63%GENERAL OFFICE SUPPLIES 3,753 1,350 679 5,500 5,500 0 0.00%SOFTWARE 8,689 27,039 46,712 25,000 25,000 0 0.00%FORMS PRINTING 5,175 16,250 8,221 11,000 11,000 0 0.00%COMPUTER HARDWARE, ETC 392 2,423 1,397 3,000 3,000 0 0.00%MISC. GROUNDS MAINTENANCE 18,090 9,460 10,722 12,000 12,000 0 0.00%

WATER ENTERPRISE FUND

53


GASOLINE ‐ UNLEADED 16,239 19,965 13,421 25,756 23,760 ‐1,996 ‐7.75%GASOLINE ‐ DIESEL 21,820 13,806 11,187 24,600 20,935 ‐3,665 ‐14.90%BITUMINOUS CONCRETE 25,805 26,416 39,769 40,000 40,000 0 0.00%GRAVEL 21,689 25,495 26,350 30,000 30,000 0 0.00%DIST. PIPE AND FITTINGS 63,178 49,999 70,657 80,000 80,000 0 0.00%LAB EQUIPMENT & SUPPLIES 19,631 18,807 17,657 21,000 21,000 0 0.00%METERS 28,396 14,448 21,460 28,000 28,000 0 0.00%CHEMICALS ‐ TREATMENT 223,593 297,445 282,952 300,000 300,000 0 0.00%CHEMICALS ‐ OTHER 0 643 0 500 500 0 0.00%GRANULAR ACTIVATED CARBON 227,921 251,424 125,712 310,000 310,000 0 0.00%SAFETY EQUIPMENT 1,196 3,203 1,101 5,500 5,500 0 0.00%UNIFORMS 17,027 17,100 17,100 17,975 17,975 0 0.00%TOOLS AND EQUIPMENT 46,150 29,942 28,819 58,200 58,200 0 0.00%MISCELLANEOUS SUPPLIES 2,908 2,652 2,732 5,000 5,000 0 0.00%MIDDLETON REFUND 300,000 350,000 350,000 350,000 350,000 0 0.00%TAXES ‐ REAL ESTATE 117,428 114,609 115,286 115,000 115,000 0 0.00%PERMITS/LICENSES 8,612 6,704 6,870 6,500 6,500 0 0.00%DEP SDWA ASSESSMENT 11,865 11,455 11,100 13,100 13,100 0 0.00%TRAVEL ALLOWANCE 3,300 7,500 6,925 10,500 10,500 0 0.00%MILEAGE REIMBURSEMENT 75 200 43 700 500 ‐200 ‐28.57%CONFERENCE FEES 710 1,164 980 0 980 980 100.00%DUES AND MEMBERSHIPS 1,619 1,375 1,656 2,994 3,141 147 4.91%SUBSCRIPTIONS 108 113 129 100 150 50 50.00%CASUALTY/LIABILITY INSURANCE 99,302 99,395 95,465 100,395 100,000 ‐395 ‐0.39%HEALTH & DENTAL COSTS 215,703 233,560 291,578 405,579 405,579 0 0.00%LIFE INSURANCE 531 543 544 556 556 0 0.00%MEDICARE/FICA INSURANCE 14,707 14,605 16,234 13,903 18,000 4,097 29.47%PENSION REIMBURSEMENTS 230,730 247,951 263,822 288,921 288,921 0 0.00%SUPPORT SERVICES 505,821 435,727 442,331 469,084 483,532 14,448 3.08%PAYMENTS IN LIEU OF TAXES 133,000 133,000 133,000 133,000 133,000 0 0.00%MISC OTHER CHARGES & EXPENSES 110 125 125 100 100 0 0.00%LICENSES‐CDL,HOISTING,ETC. 980 330 330 600 600 0 0.00%OUT OF STATE TRAVEL EXPENSES 0 4,585 595 4,823 3,120 ‐1,703 ‐35.31%TOTAL OPERATING EXPENSES 3,441,802 3,559,845 3,384,726 4,244,522 4,258,568 14,046 0.33%

TRANSFER TO ENTERPRISE FUNDS 100,000 120,000 100,000 100,000 100,000 0 0.00%TRANSFER TO UNEMPLOYMENT FUND 25,000 25,000 25,000 25,000 25,000 0 0.00%TRANSFER TO WORKERS COMP FUND 67,000 87,000 87,000 87,000 87,000 0 0.00%TRANSFER TO OPEB STABILIZATION 110,846 132,000 131,346 131,346 131,346 0 0.00%TOTAL INTERFUND TRANSFERS 302,846 364,000 343,346 343,346 343,346 0 0.00%

ADMINISTRATIVE FEES 0 0 22,015 0 20,000 20,000 100.00%GREENSAND FILTRATION 11/03 125,000 120,000 120,000 115,000 115,000 0 0.00%WATER BONDS 3/15/05 70,000 70,000 70,000 65,000 65,000 0 0.00%WATER 7/1/06 31,000 30,600 29,600 29,300 29,000 ‐300 ‐1.02%WATER MAINS 07/08 35,000 35,000 35,000 35,000 35,000 0 0.00%MWPAT 937,744 956,855 937,190 957,558 978,370 20,812 2.17%WATER TREATMENT PLANT 7/10 85,000 85,000 85,000 85,000 55,000 ‐30,000 ‐35.29%WATER TREATMENT PLANT 07/11 35,000 35,000 35,000 35,000 35,000 0 0.00%


54


STATE HOSP RESERVOIR 07/11 35,000 35,000 35,000 0 0 0 0.00%FOLLY HILL RESERVOIR 07/11 60,000 60,000 60,000 0 0 0 0.00%WATER TREATMENT PLANT 07/11 55,000 55,000 55,000 55,000 55,000 0 0.00%WATER BONDS 7/15/99 115,000 111,250 110,000 0 0 0 0.00%WATER MAINS 8/19 0 0 0 100,000 100,000 0 0.00%WATER DISTRIBUTION SYSTEM 8/20 0 0 0 0 5,000 5,000 100.00%INT‐GREENSAND FILTRATION 11/03 15,050 12,600 10,200 7,850 5,550 ‐2,300 ‐29.30%INT ‐ WATER BONDS 3/15/05 9,900 8,500 7,100 5,750 4,450 ‐1,300 ‐22.61%INT ‐ WATER BONDS 7/1/06 5,797 5,181 4,431 3,547 2,818 ‐729 ‐20.55%INT ‐ WATER MAINS 7/08 12,700 11,300 9,900 8,500 7,100 ‐1,400 ‐16.47%INT ‐ MWPAT 355,547 335,517 293,536 295,183 255,230 ‐39,953 ‐13.53%INT‐WATER TREATMENT PLANT 7/10 42,644 38,394 34,144 29,894 43,021 13,127 43.91%INT‐WATER TRTMNT PLANT 07/11 19,294 17,894 16,406 14,831 13,257 ‐1,574 ‐10.61%INT‐STATE HOSP RES. 07/11 3,675 2,275 788 0 0 0 0.00%INT‐FOLLY HILL RESER. 07/11 6,300 3,900 1,350 0 0 0 0.00%INT‐WATER TRTMNT PLANT 07/11 30,319 28,119 25,781 23,307 20,832 ‐2,475 ‐10.62%INT ‐ WATER BONDS 7/15/99 10,811 6,423 2,145 0 0 0 0.00%INT ‐ WATER MAINS 8/19 0 0 0 102,500 62,500 ‐40,000 ‐39.02%INT ‐ WATER DISTRIBUTION SYSTEM 8/20 0 0 0 0 84,648 84,648 100.00%INTEREST ON TEMPORARY LOANS 0 0 0 50,000 75,000 25,000 50.00%TOTAL DEBT 2,095,781 2,063,808 1,999,586 2,018,220 2,066,776 48,556 2.41%

58701 CAPITAL OUTLAY ‐ REPLACE. EQ. 51,800 107,148 90,063 50,000 52,000 2,000 4.00%TOTAL CAPITAL 51,800 107,148 90,063 50,000 52,000 2,000 4.00%

TOTAL WATER 7,615,033 7,854,503 7,656,505 8,708,083 8,802,204 94,121 1.08%


55

PUBLIC WORKS (ELECTRIC & BUSINESS DIVISIONS)

DIVISION DESCRIPTION

Maintain 141 miles of overhead lines and 37 miles of underground lines within a 13.6‐mile service area

Maintain nine substations, one switching station, and 13,000 meters

Purchase and distribute power and maintain power supply portfolio, with an emphasis on renewable/non‐carbon sources

Business Division is responsible for electric, water, and sewer billing processes, maintaining Electric Division accounting and financialsystems, and maintenance of AMI systems

BUDGET COMMENTARY

Total operating and power supply expenses are forecast to increase approximately 4.5% in 2021; 2020 retail kWh sales decreased 3.4% from 2019; 2021 kWh sales are anticipated to remain stable from 2020 sales.

CALENDAR YEAR 2020 ACCOMPLISHMENTS

Installed additional fleet Electric Vehicle charging station at Town Hall

Implemented processes to meet customer expectations while meeting Covid‐19 guidelines

Completed the Danversport Substation reliability project

Decommissioned Ferncroft Switching Station

CALENDAR YEAR 2021 STRATEGIC GOALS

Upgrade the work order and financial management systems

Deploy Outage Management System (OMS) online tool for customers

Station 42 control house design and Northlands Substation design

Utilize DOER grant to install additional public Electric Vehicle charging stations

Residential meter upgrade

Private area lighting LED upgrade

Implementation of cost‐of‐service recommendations

Upgrade Meter Data Management Software

Upgrade meter reading infrastructure & head end software

DPW Electric & Biz Office FTE FY2020 FY2021 FY2022

Electric Division 31.00 32.00 33.00

Business Division 17.50 17.50 17.50

48.50 49.50 50.50

56

TOWN OF DANVERSELECTRIC DIVISIONPROFIT AND LOSS STATEMENT

FERC CY18 CY19 CY20 CY20 CY21NUMBER ACTUAL ACTUAL BUDGET YTD (OCT) REQUEST

SALES (KWH) ENERGY SALES 306,210,876 292,676,283 299,978,093 239,456,094 299,423,095 STREET LIGHT SALES 729,337 780,735 845,366 1,238,353 800,353TOTAL 306,940,213 293,457,018 300,823,459 240,694,447 300,223,448

REVENUES

SMALL GENERAL SERVICE 440 3,714,430 3,571,947 3,715,735 2,705,099 3,745,219MEDIUM GENERAL SERVICE 440 15,101,350 14,206,112 15,822,001 10,858,129 15,360,114LARGE GENERAL SERVICE 440 6,048,169 5,389,064 6,013,916 4,764,278 5,870,114DOMESTIC SALES 440 13,791,487 13,056,947 13,893,175 11,631,989 14,608,033MUNICIPAL SALES 444 1,226,266 1,149,704 1,209,588 857,859 1,183,179SENTINEL LIGHTS FLAT 415 169,715 170,138 170,412 139,025 169,875

REVENUE SUBTOTAL 40,051,418 37,543,914 40,824,827 30,956,380 40,936,534

JOBBING & CONTRACT WORK 415 772,347 95,190 294,759 133,110 342,423LIENS 415 74 67 0 0 0FLOODLIGHTS SPORTS FIELDS 415 2,004 2,004 2,004 1,670 2,004COLLECTION CHARGES 415 8,575 12,368 15,650 0 10,450NSF CHARGES 415 1,553 1,388 1,520 1,185 1,500OTHER INCOME 418 7,473 10,280 0 9,021 9,526INTEREST INCOME 419 383,683 457,163 402,372 103,851 137,245MISC NON-OPERATING INCOME 421 328,756 1,564,325 0 0 0

PROPOSED CALENDAR YEAR 2021 BUDGET

58

UNUSED CUSTOMER DISCOUNTS 450 (1,188,813) (1,169,133) (1,158,758) (1,240,991) (1,164,792)MISC SERVICE REVENUES 451 292,982 293,053 296,788 241,323 285,000RENT 451 1,800 1,800 1,800 1,500 1,800OTHER ELECTRIC REVENUES 456 102,075 0 0 0 0

TOTAL OTHER INCOME 712,509 1,268,504 (143,865) (749,330) (374,844)

TOTAL REVENUE 40,763,928 38,812,418 40,680,962 30,207,050 40,561,690

EXPENSES

DEPRECIATION EXP 403 2,511,165 2,501,098 2,678,594 2,033,802 2,733,149TAXES 408 21,589 22,338 21,600 0 22,500PURCHASED POWER 555 19,880,475 18,299,226 17,802,548 12,273,241 16,876,093SYSTEM CONTROL - LOAD DISPATCH 556 417,310 31,315 473,566 3,749 485,055OTHER PURCHASED POWER 557 146,243 149,432 133,716 116,612 144,997TRANSMISSION - BY OTHERS 565 5,517,485 5,658,769 6,946,057 4,243,161 7,983,875OPERATION - SUPERVISION OF DISTRIBUTION 580 1,572,347 1,508,782 1,668,228 898,368 1,448,090OPERATION - LABOR EXPENSE 581 79,881 77,432 65,570 89,135 107,274OPERATION - SUPPLIES AND EXPENSES 582 516,925 641,336 687,011 342,882 567,419OPERATION - OVERHEAD LINE EXPENSES 583 429,305 376,651 407,277 172,919 262,642OPERATION - UNDERGROUND LINE EXPENSES 584 90,891 54,270 24,391 33,531 42,331OPERATION - STREET LIGHTING AND SIGNAL 585 40,679 94,540 90,161 65,062 70,281OPERATION - METER EXPENSES 586 833 393 0 1,300 613OPERATION - CUST INSTALLATION EXPENSES 587 173,843 175,503 190,286 87,853 143,888OPERATION - MISC DISTRIBUTION EXPENSES 588 33,170 51,828 45,219 21,224 36,339OPERATION - RENTS (DISTRIBUTION) 589 0 0 0 0 0MAINT - SUPERVISION & ENGINEERING 590 153,747 154,180 136,197 255,997 293,999MAINTENANCE OF STRUCTURES 591 0 4,048 4,857 0 0MAINTENANCE OF STATION EQUIPMENT 592 64,877 86,534 84,562 17,128 4,957MAINTENANCE OF OVERHEAD LINES 593 362,888 288,230 402,077 234,251 353,325MAINTENANCE OF UNDERGROUND LINES 594 7,679 19,359 8,256 12,463 2,006MAINTENANCE OF LINE TRANSFORMERS 595 2,314 11,598 12,606 0 88MAINTENANCE OF STREET LIGHTING 596 204 1,664 3,581 2 90

59

MAINTENANCE OF METERS 597 6,441 5,536 4,960 3,750 5,989MAINTENANCE OF MISC DISTRIBUTION PLANT 598 0 4,150 1,440 360 2,075CUST ACCTS - SUPERVISION 901 0 0 0 0 0METER MONITORING LABOR & EXPENSES 902 119,406 177,033 204,595 49,037 122,816BILLING & COLLECTIONS EXPENSES 903 828,106 817,293 822,432 674,795 960,096UNCOLLECTIBLE ACCOUNTS 904 52,067 69,532 52,100 0 60,800CUSTOMER - EFFICIENCY INCENTIVES 908 0 0 0 0 0ENERGY/RCS CONSERVATION 909 242,961 289,118 295,431 165,295 249,269ADMIN & GENERAL SALARIES 920 1,076,564 1,112,727 1,216,728 988,605 1,154,176OFFICE SUPPLIES & EXPENSES 921 579,227 642,046 496,867 393,518 725,727OUTSIDE SERVICES 923 442,905 450,346 435,610 126,001 360,022PROPERTY INSURANCE 924 208,975 196,021 197,900 94,593 194,900EMPLOYEE PENSIONS & BENEFITS 926 64,967 2,027,598 2,187,099 1,173,623 2,078,120MISC GENERAL EXPENSES 930 146,525 154,500 153,739 821,024 154,829RENTAL EXPENSE - ADMIN & GENERAL 931 0 0 0 0 0TRANSPORTATION 933 60,023 73,342 105,498 15,461 106,683MAINTENANCE OF GENERAL PLANT 935 227,089 287,258 398,657 148,225 473,762PAYROLL LABOR DISTRIBUTION 997 (65,203) 0 0 (464) 0STORES EXPENSE 163 201,231 175,600 178,143 104,323 170,467INTEREST ON BOND & NOTES 427 209,506 183,867 171,153 85,576 155,506AMORTIZATION OF DEBT DISCOUNT 428 0 0 0 (303,900) 0OTHER INTEREST EXPENSE 431 5,187 10,155 4,557 5,155 6,186

TOTAL EXPENSES 36,429,826 36,884,647 38,813,269 25,447,659 38,560,433

TOTAL REVENUE 40,763,928 38,812,418 40,680,962 30,207,050 40,561,690 TOTAL EXPENSES 36,429,826 36,884,647 38,813,269 25,447,659 38,560,433

PROFIT/(LOSS) 4,334,102 1,927,772 1,867,693 4,759,391 2,001,257

PILOT (758,900) (770,792) (963,490) (802,910) (1,125,838)

ADJUSTED NET INCOME 3,575,202 1,156,980 904,203 3,956,481 875,419

60

TOWN OF DANVERSELECTRIC DIVISIONCALENDAR YEAR 2021 BUDGET

SUMMARY OF OPERATING EXPENSES AND CAPITAL IMPROVEMENTS

FERC CY18 CY19 CY20 CY20 CY21 NUMBER ACTUAL ACTUAL BUDGET YTD (OCT) REQUEST

OPERATING EXPENSES

DEPRECIATION EXP 3-5% 403 2,511,165 2,501,098 2,678,594 2,033,802 2,733,149PROPERTY TAXES 408 21,589 22,338 21,600 0 22,500POWER SUPPLY 555-557 20,444,027 18,479,973 18,409,830 12,393,601 17,506,146 PURCHASED POWER 555 19,880,475 18,299,226 17,802,548 12,273,241 16,876,093 SYSTEM CONTROL - LOAD DISPATCH 556 417,310 31,315 473,566 3,749 485,055 OTHER PURCHASED POWER 557 146,243 149,432 133,716 116,612 144,997TRANSMISSION - BY OTHERS 565 5,517,485 5,658,769 6,946,057 4,243,161 7,983,875DISTRIBUTION OPERATIONS 580-589 2,937,873 2,980,735 3,178,143 1,712,275 2,678,877 OPERATION - SUPERVISION OF DISTRIBUTION 580 1,572,347 1,508,782 1,668,228 898,368 1,448,090 OPERATION - LABOR EXPENSE 581 79,881 77,432 65,570 89,135 107,274 OPERATION - SUPPLIES AND EXPENSES 582 516,925 641,336 687,011 342,882 567,419 OPERATION - OVERHEAD LINE EXPENSES 583 429,305 376,651 407,277 172,919 262,642 OPERATION - UNDERGROUND LINE EXPENSES 584 90,891 54,270 24,391 33,531 42,331 OPERATION - STREET LIGHTING AND SIGNAL 585 40,679 94,540 90,161 65,062 70,281 STREET LIGHTS 585.1 23,041 23,493 23,310 13,795 25,938 TRAFFIC SIGNALS 585.2 17,637 71,048 66,851 51,267 44,343 OPERATION - METER EXPENSES 586 833 393 0 1,300 613 OPERATION - CUST INSTALLATION EXPENSES 587 173,843 175,503 190,286 87,853 143,888 OPERATION - MISC DISTRIBUTION EXPENSES 588 33,170 51,828 45,219 21,224 36,339 OPERATION - RENTS (DISTRIBUTION) 589 0 0 0 0 0DISTRIBUTION MAINTENANCE 590-598 598,151 575,298 658,536 523,952 662,527 MAINT - SUPERVISION & ENGINEERING 590 153,747 154,180 136,197 255,997 293,999 MAINTENANCE OF STRUCTURES 591 0 4,048 4,857 0 0 MAINTENANCE OF STATION EQUIPMENT 592 64,877 86,534 84,562 17,128 4,957 MAINTENANCE OF OVERHEAD LINES 593 362,888 288,230 402,077 234,251 353,325 MAINTENANCE OF UNDERGROUND LINES 594 7,679 19,359 8,256 12,463 2,006

61

MAINTENANCE OF LINE TRANSFORMERS 595 2,314 11,598 12,606 0 88 MAINTENANCE OF STREET LIGHTING 596 204 1,664 3,581 2 90 STREET LIGHTING 596 204 1,664 3,581 2 90 TRAFFIC SIGNALS 596 0 0 0 0 0 MAINTENANCE OF METERS 597 6,441 5,536 4,960 3,750 5,989 MAINTENANCE OF MISC DISTRIBUTION PLANT 598 0 4,150 1,440 360 2,075CUSTOMER ACCOUNTS 901-909 1,242,540 1,352,977 1,374,558 889,127 1,392,981 CUST ACCTS - SUPERVISION 901 0 0 0 0 0 METER READING EXPENSES 902 119,406 177,033 204,595 49,037 122,816 BILLING & COLLECTIONS EXPENSES 903 828,106 817,293 822,432 674,795 960,096 INVENTORY 903 0 0 0 0 0 MISCELLANEOUS COLLECTIONS EXPENSE 903 0 0 0 0 0 CLERICAL EXPENSE 903 631,156 611,396 611,163 559,211 802,960 DATA PROCESSING 903 77,158 108,714 111,573 48,223 57,867 LOCK BOX PAYMENT PROCESSING 903 17,987 17,023 17,196 10,927 16,041 POSTAGE 903 101,805 80,159 82,500 56,434 83,228 UNCOLLECTIBLE ACCOUNTS 904 52,067 69,532 52,100 0 60,800 CUSTOMER - EFFICIENCY INCENTIVES 908 0 0 0 0 0 ENERGY/RCS CONSERVATION 909 242,961 289,118 295,431 165,295 249,269ADMINISTRATIVE & GENERAL EXPENSE 920-997&163 2,942,303 5,119,438 5,370,241 3,864,910 5,418,686 ADMIN & GENERAL SALARIES 920 1,076,564 1,112,727 1,216,728 988,605 1,154,176 ADMIN & GENERAL SALARIES 920 539,337 479,404 438,173 308,281 448,603 SUPPORT SERVICES 920 537,142 633,058 778,391 680,324 705,573 GIS 920 85 265 164 0 0 COMMUNICATION BACKHAUL 920 0 0 0 0 0 OFFICE SUPPLIES & EXPENSES 921 579,227 642,046 496,867 393,518 725,727 PRINTING 921 7,590 96 115 0 0 ELECTRIC SUPPLIES 921 19,877 21,629 20,160 14,499 19,635 TELEPHONE 921 56,338 50,526 49,608 17,071 42,450 NATURAL GAS 921 0 0 0 0 0 COMPUTER HARDWARE 921 159,971 75,553 87,696 91,713 115,193 COMPUTER SOFTWARE 921 291,091 443,978 296,460 244,098 506,453 FORMS 921 10,537 10,128 6,648 3,192 8,165 WATER 921 0 0 0 0 0 OFFICE EQUIPMENT 921 33,823 40,136 36,180 22,945 33,831 OUTSIDE SERVICES EMPLOYED 923 442,905 450,346 435,610 126,001 360,022

62

ENGINEERING SERVICES 923 197,141 176,041 54,500 42,380 58,500 AUDIT 923 73,406 64,872 48,910 32,500 48,910 LEGAL 923 131,201 157,192 115,000 34,644 0 CONSULTING/GENERAL SERVICES 923 0 0 0 0 0 SAFETY & TRAINING 923 16,201 19,471 71,600 (16,431) 32,795 PROPERTY INSURANCE 923 763 0 92,000 21,141 95,000 TRAINING 923 24,194 32,770 53,600 11,767 124,817 PROPERTY INSURANCE 924 208,975 196,021 197,900 94,593 194,900 EMPLOYEE PENSIONS & BENEFITS 926 64,967 2,027,598 2,187,099 1,173,623 2,078,120 EMPLOYEE PENSIONS Cash Contribution 926 638,575 1,324,983 593,253 (158,695) 593,253 EMPLOYEE PENSIONS DEFERRED 926 0 0 454,137 0 195,645 HEALTH, LIFE INSURANCE & MEDICARE 926 433,514 461,717 818,958 411,963 823,705 WORKMAN'S COMPENSATION 926 155,000 192,500 195,000 195,000 195,000 UNEMPLOYMENT INSURANCE 926 72,960 73,360 92,000 92,000 92,000 LIFE INSURANCE 926 1,584 1,558 1,495 1,166 2,408 FICA - MEDICARE 926 60,599 59,594 63,000 41,738 63,000 OPEB 926 (1,297,264) (86,114) (30,744) 590,451 113,109

OPEB (HEALTH INSURANCE) Expense 926 (1,297,264) (86,114) (30,744) 590,451 113,109 OPEB (HEALTH INSURANCE) Cash Contribution 926 0 0 0 0 0 STORES EXPENSE 163 201,231 175,600 178,143 104,323 170,467 MISC GENERAL EXPENSES 930 146,525 154,500 153,739 821,024 154,829 LICENSES 930 460 748 1,290 0 604 CLOTHING ALLOWANCE 930 16,435 15,924 17,182 7,793 16,180 MEAL EXSPENSE 930 0 0 0 0 0 SUBSCRIPTIONS 930 579 632 759 374 606 GENERAL DUES/MEMBERSHIPS 930 3,169 2,538 3,046 1,057 2,854 MEAM DUES 930 4,643 5,637 5,000 0 5,140 APPA DUES 930 27,586 18,612 20,000 18,180 23,099 NEPPA DUES 930 17,923 17,008 18,000 18,611 18,000 IEEE DUES 930 0 0 1,100 0 0 ECNE DUES 930 0 0 1,900 0 0 MISCELLANEOUS COLLECTIONS EXPENSE 930 8,269 10,230 8,823 3,351 13,030 OUT OF STATE TRAVEL 930 2,824 6,799 8,192 10,667 4,812 TRAVEL ALLOWANCE 930 3,472 2,728 3,121 2,672 3,100 MILEAGE REIMBURSEMENT 930 1,360 2,863 2,336 2,042 2,112 PERSONAL 930 44,395 47,129 44,352 27,944 45,762

63

JURY DUTY 930 638 433 680 414 535 OTHER TOWN ACTIVITIES 930 10,975 19,833 13,903 726,849 15,404 MISC GENERAL - PARKING/TOLLS 930 45 76 46 0 60 MISC GENERAL - FLSA 930 3,753 3,309 4,009 1,069 3,531 RENTAL EXPENSE 931 0 0 0 0 0 TRANSPORTATION 933 60,023 73,342 105,498 15,461 106,683 MAINTENANCE EXPENSE 933 0 0 40,000 0 40,000 GASOLINE 933 15,336 18,255 15,616 3,474 16,796 DIESEL 933 15,792 16,950 16,883 4,310 16,371 OTHER 933 28,895 38,137 33,000 7,678 33,516 MAINTENANCE OF GENERAL PLANT 935 227,089 287,258 398,657 148,225 473,762 WATER 935 2,669 2,862 2,651 1,993 2,392 GENERAL MAINTENANCE 935 87,734 110,989 135,585 74,767 89,721 SECURITY 935 4,549 3,732 4,045 5,775 6,930 CONTRACT CLEANING 935 50,891 53,569 58,707 33,206 60,316 RUBBISH REMOVAL 935 337 345 310 260 312 HAZARDOUS WASTRE REMOVAL 935 66,147 102,457 74,901 20,957 300,571 NATURAL GAS 935 14,762 13,303 122,458 11,267 13,520 PAYROLL LABOR DISTRIBUTION 997 (65,203) 0 0 (464) 0 OPERATIONS 997 (65,203) 0 0 0 0 MAINTENANCE 997 (1,450) 0 0 0 0 STORES 997 1,450 0 0 0 0 CUSTOMER SERVICE 997 0 0 0 0 0 ADMIN/GENERAL 997 0 0 0 0 0 TRUCKS 997 0 0 0 (464) 0INTEREST EXPENSE 427-431 214,692 194,021 175,710 (213,169) 161,692 INTEREST ON BONDS & NOTES 427 209,506 183,867 171,153 85,576 155,506 AMORTIZATION OF DEBT DISCOUNT 428 0 0 0 (303,900) 0 OTHER INTEREST EXPENSES 431 5,187 10,155 4,557 5,155 6,186

TOTAL OPERATING EXPENSE 36,429,826 36,884,647 38,813,269 25,447,659 38,560,433

DISTRIBUTION PLANT 2,435,913 1,809,122 3,207,321 807,454 2,355,000 LAND & LAND RIGHTS 360.0 0 0 0 0 0 STRUCTURES & IMPROVEMENTS 341.0 & 361.0 0 0 0 0 0 STATION EQUIPMENT 362.0 264,934 287,605 1,150,735 37,616 770,000

64

STORAGE BATTERIES 363.0 0 0 0 0 0 POLES & FIXTURES 364.0 249,708 102,369 137,500 49,052 106,250 OVERHEAD CONDUCTORS & DEVICES 365.0 547,648 624,061 414,500 318,619 296,250 UNDERGROUND CONDUIT 366.0 0 0 137,500 0 106,250 UNDERGROUND CONDUCTORS & DEVICES 367.0 205,569 405,543 267,500 114,037 361,250 LINE TRANSFORMERS 368.0 29,723 59,557 98,000 113,648 350,000 SERVICES 369.0 32,605 44,441 0 29,784 0 METERS 370.0 41,412 33,223 283,000 44,431 70,000 INSTALLATIONS ON CUSTOMER PREMISES 371.0 0 41,672 70,000 34,219 70,000 STREET LIGHTS & SIGNALS STREET LIGHTING 373.1 242,804 30,618 146,100 1,089 100,000 TRAFFIC SIGNALS 373.2 821,510 180,034 0 64,959 0 MISCELLANEOUS OTHER 502,486 125,000

GENERAL PLANT 358,468 840,322 1,234,007 313,696 1,235,000 SMART-GRID DISTRIBUTION AUTOMATION (HARDWARE) 382.0 0 0 167,426 43,830 135,000 SMART-GRID DISTRBUTION AUTOMATION (SOFTWARE) 383.0 0 75,645 167,427 15,829 275,000 STRUCTURES & IMPROVEMENTS 390.0 26,034 156,917 155,534 78,028 220,000 OFFICE FURNITURE & EQUIPMENT 391.0 0 78,666 0 11,163 0 TOOLS & EQUIPMENT 394.0 3,854 8,671 0 6,309 0 LABORATORY EQUIPMENT 395.0 0 0 0 0 0 POWER OPERATED EQUIPMENT 396.0 0 0 0 0 0 COMMUNICATION EQUIPMENT 397.0 97,490 84,705 259,620 106,325 0 MISCELLANEOUS EQUIPMENT 398.0 0 0 125,000 0 0 OTHER TANGIBLE ASSETS 399.0 0 5,471 0 0 0

TRANSPORTATION EQUIPMENT 392.0 231,091 430,247 359,000 52,213 605,000 Vehicle - (Unit 22) Bucket Truck 250,000 Vehicle - (Unit 25) Pickup Truck 40,000 Vehicle - (Unit 31) 2006 Digger Derrick 305,000 Light Tower 10,000 Vehicle - 2006 Digger Derrick 280,000 Vehicle - 2009 (Unit 27) Colorado PU 42,000 Vehicle - New PHEV SUV 37,000TOTAL CAPITAL EXPENDITURES 2,794,381 2,649,444 4,441,328 1,121,150 3,590,000TOTAL FERC LINE ITEMS 39,224,206 39,534,091 43,254,597 26,568,809 42,150,433

65

PROJECT NAME CY-2020 CY-2020-EST CY-2021 CY-2022 CY-2023 CY-2024 CY-2025 FERC NOTES

ACS Hardware & Software refresh / Work Order & Financial Management Software Upgrade / O.M.S. 334,853 94,095 410,000 50,000 0 0 382/383

SCADA Hardware & Software refresh (2019) / Work Order & Financial Management Software (2019 - 2021) / OMS Package 2020 & 2021

Station 42 Control House Upgrade 350,000 0 350,000 2,200,000 0 0 362 New Control House @ STA 42 (Design & Build)

Station 42 Upgrades 95,000 9,855 120,000 0 0 0 362 Upgrade Breakers, Disconnects, Airbreaks; Cameras

Fiberoptic Installation 162,337 5,542 0 0 0 0 397Express Fiber from STA42 to 1 Burroughs St / 2018 - Town wide Fiber Backbone Allotment

Communication Equip Upgrade 97,283 100,783 0 0 0 0 397 Assessment & Upgrade on Exisitng WiMax Communication Tower

Danversport Substation Upgrades 0 0 0 0 0 0 362 Substation Upgrades

Cabot Road Substation Upgrades 115,000 0 0 115,000 0 0 362 Substation Upgrades / H.S backup

Conant Street Substation Modification/Upgrade 0 0 0 0 0 500,000 400,000 362 Substation Retirement

Northland Substation (Constitution Lane) Upgrades 590,735 2,650 300,000 300,000 1,950,000 2,250,000 2,250,000 362 Substation Upgrades - Transgard complete

Hathorne Switching Station 0 0 0 0 0 0 362 Upgrade Breaker to Hogan Center (2019); TransGard (complete)

23kV System Upgrades 240,000 80,891 175,000 300,000 300,000 300,000 364/365/366/367 Liberty Tree Mall section upgrade (2019) / Various OH/UG Feeder Upgrades

5kV Upgrades/Feeder Hardening Projects (OH/UG) 310,000 225,000 250,000 250,000 250,000 250,000 364/365/366/367 Various OH/UG Feeder Upgrades: 5kV sustainability upgrades

Ferncroft Switching Station 90,000 90,000 0 0 0 0 364/365/368Pole line & Structure/Equip inst/upgrade to accommodate installation of Permananent generators

Animal Guard Initiative 10,000 0 5,000 5,000 5,000 5,000 365 Animal protection - 23kV System wide

23kV/5kV Cutout/Switch Replacement Program 15,000 15,000 15,000 15,000 15,000 365 Porcelin potted cutout replacement/box style disconnect replacement

23 kV Padmount Switchgear Replacement Program 130,000 0 255,000 340,000 340,000 340,000 340,000 367 23kv padmount switchgear replacements

Transformer Upgrades/Replacements/ TLM Program 98,000 48,767 50,000 115,000 50,000 50,000 368Upgrade Old vintage/overloaded transformers system wide / containment area for Transformers at STA 20A - 2019 / 2020

Power Factor Correction 112,000 12,477 100,000 0 0 0 365 Upgrade Cap Banks 23kV/5kV

Traffic Signal Improvements 0 0 0 0 0 0 365/373 Summer- Maple Intersection/Traffic signal improvemtns 2017-2019

Town-wide LED Street Light Conversion 146,100 66,048 100,000 100,000 0 0 373 LED Private area lighting Conversion

Electric Vehicle Charging Stations 12,606 0 0 0 0 392 Electric Vehicle Charging Stations - EV Program

1 Burroughs Street HVAC 0 0 0 0 0 0 390 HVAC replacement

1 Burroughs Street Improvements 90,534 97,671 55,000 0 0 0 390 Burroughs Street Parking Lot

2 Burroughs Street Improvements 45,000 0 45,000 100,000 0 0 390 Revamp Operations (linemen) room / Design of Overhang for storage Platform

1 & 2 Burroughs Street - Physical Security 20,000 0 20,000 0 0 0 390 Upgrade/Install Physical Security Cameras

Electric Division Facility 0 0 0 0 0 0 390 New Facility

Elster Meter Rex2 Upgrade Project 283,000 44,431 70,000 70,000 0 0 370 Replacement of Rex2 meters

Landfill / Smith School Solar Project 125,000 0 125,000 0 0 0 Landfill Solar Project / Smith School solar

ROW Revital/ Upgrade 50,000 0 70,000 200,000 100,000 0 365Upgrade Bridges so we may continue to access the ROW to maintain overhead Lines

Doty Ave SESD Pumping Station Generator Project 70,000 0 70,000 440,000 0 0 371 SESD Requirement

Rolling Stock 363,500 33,000 605,000 100,000 100,000 500,000 430,000 392 Transportation Equipment

Other Distribution Plant (FERC 360 - 373) 355,000 357,898 300,000 300,000 300,000 300,000 360 - 373 New Business Installations/Asset Replacement(Poles, Transformer, etc)

Other General Plant (FERC 382-399) 147,486 947,472 100,000 100,000 100,000 100,000 382 - 399 Facility & Equipment Upgrades

TOTAL 4,458,434 2,216,580 3,590,000 5,100,000 3,510,000 4,610,000 3,420,000

DANVERS ELECTRIC DIVISIONPLANNED PROGRAM CAPITAL IMPROVEMENTS

66

LAND USE & COMMUNITY SERVICES


The Land Use and Community Services (LUCS) Department is responsible for a broad range of activities and services across its five divisions: Inspectional Services, Public Health, Planning & Economic Development, Senior & Social Services, and Veterans’ Services. Although budgeted separately, the Recreation Department also falls under LUCS management. This larger group constitutes one of the principal functional service areas within the Town.

This Department's crucial duties include running senior nutrition, transportation, and supportive daycare programs; reviewing and administering all building and development permitting; long‐range planning; and public health and veteran support programs. LUCS staff supports six major regulatory boards: the Zoning Board of Appeals, the Planning Board, the Board of Health, the Conservation Commission, the Historic District Commission, and the Preservation Commission. In addition to these, LUCS supports approximately a dozen other boards and committees, including the Affordable Housing Trust, the Council on Aging, the Rail Trail Advisory Committee, and the Transportation Advisory Committee.

BUDGET COMMENTARY

Contrasting the Department's FY2021 appropriation to its FY2022 request shows an increase of 4.10% or $75,578, mostly driven by by contractual obligations. The following pages summarize each of our constituent Divisions in more detail, including our FY 2021 accomplishments and FY2022 objectives.

Land Use & Community Services FTE FY2020 FY2021 FY2022

Inspectional Services 6.08 6.56 5.77

Public Health 3.55 3.55 3.55

Planning & Economic Development 4.67 4.67 5.71

Senior & Social Services 5.23 5.23 5.23

Veterans’ Services (Split from Health in FY22) 1.40 2.40 2.40

20.93 22.41 22.66

67

FY2018 FY2019 FY2020 FY2021 FY2022 FY21‐FY22 FY21‐FY22Actual Actual Actual Budget Proposed $ Increase % Increase

INSPECTIONAL SERVICES 334,690 466,267 447,397 510,580 463,303 ‐47,277 ‐9.26%HEALTH 277,106 315,489 329,429 368,656 273,429 ‐95,227 ‐25.83%PLANNING 334,157 339,023 305,699 343,904 439,198 95,294 27.71%SENIOR 225,342 244,503 324,656 370,581 358,657 ‐11,924 ‐3.22%VETERANS' SERVICES 0 0 0 0 130,000 130,000 100.00%TOTAL SALARIES & WAGES 1,171,295 1,365,282 1,407,181 1,593,721 1,664,587 70,866 4.45%

INSPECTIONAL SERVICES 46,166 34,386 34,074 44,000 44,000 0 0.00%HEALTH 84,383 71,812 69,546 97,868 82,630 ‐15,238 ‐15.57%PLANNING 72,933 50,871 33,791 76,510 79,510 3,000 3.92%SENIOR 25,245 27,802 21,588 31,715 31,715 0 0.00%VETERANS' SERVICES 0 0 0 0 16,950 16,950 100.00%TOTAL OPERATING EXPENSES 228,727 184,870 158,999 250,093 254,805 4,712 1.88%

TOTAL LAND USE & COMMUNITY SERVICES 1,400,022 1,550,152 1,566,180 1,843,814 1,919,392 75,578 4.10%

LAND USE & COMMUNITY SERVICES

68

INSPECTIONAL SERVICES

DIVISION DESCRIPTION Inspections: The primary responsibility of Inspectional Services is ensur‐ing public safety in the built environment. This is accomplished through the administration of the State's Building Code (780 CMR), Plumbing and Gas Code (248 CMR), Electrical Code (527 CMR), and Architectural Access Code (521 CMR)

Sealer of Weights and Measures: Duties include annual testing of all weighing and measuring devices and processing consumer complaints re‐garding these issues. The Sealer's goal is to ensure that consumers are guaranteed accurate weighing, measuring, and pricing in their purchases

Zoning Administration: In collaboration with the Planning and Economic Development Division, a critical component of the Division's work includes regular compliance and enforcement of the Town's Zoning By‐Law. Zoning review of elements regarding uses, setbacks, height, and parking occur during building permit review

BUDGET COMMENTARY

Overall, the Inspectional Services budget is down $47,277, or 8.52%. With the retire‐ment in the spring of 2021 of the Town's long‐time Inspector of Buildings and Assis‐tant Building Inspector, there are several budget changes. Overall administration of the Zoning By‐Law (enforcement and technical support to the Zoning Board of Ap‐peals) has been assigned to the Planning Division


Continued to provide excellent inspectional services and permitting oversightduring the pandemic.


Continue to provide for a safe built environment in the Town of Danvers

Inspectional Services FTE FY2020 FY2021 FY2022

Building Commissioner 1.00 1.00 1.00

Assistant Building Inspector 1.00 1.00 1.00

Plumbing & Gas Inspector 1.00 1.00 1.00

Wiring Inspector 1.00 1.00 1.00

Confidential Senior Administrative Assistant 0.85 0.85 1.00


Clerk Typist 0.23 0.23 0.23

Assistant Building Inspector ‐ 0.48 ‐

Total 6.08 6.56 5.77

69


S&W PERMANENT‐FULL TIME 270,393 386,941 379,456 394,609 339,748 ‐54,861 ‐13.90%S&W PERMANENT ‐ PART TIME 29,274 42,875 46,993 83,041 89,353 6,312 7.60%S&W ‐ TEMPORARY POSITIONS 23,868 28,450 12,132 21,480 21,927 447 2.08%OVERTIME 5,987 2,951 5,116 6,400 7,600 1,200 18.75%LONGEVITY 2,725 2,900 1,425 1,500 2,050 550 36.67%SICK LEAVE INCENTIVE 2,443 2,150 2,275 3,550 2,625 ‐925 ‐26.06%TOTAL SALARIES & WAGES 334,690 466,267 447,397 510,580 463,303 ‐47,277 ‐9.26%

OFFICE EQUIPMENT MAINTENANCE 895 1,186 1,055 800 800 0 0.00%VEHICLE MAINTENANCE 0 0 0 500 500 0 0.00%SOFTWARE MAINTENANCE 7,988 4,212 4,980 6,400 6,400 0 0.00%TRAINING SERVICES 1,164 1,458 1,998 2,000 2,000 0 0.00%TELEPHONE 1,492 1,534 1,574 1,600 1,600 0 0.00%GENERAL OFFICE SUPPLIES 1,957 2,085 1,848 2,100 2,100 0 0.00%COMPUTER SUPPLIES 0 234 0 250 250 0 0.00%FORMS PRINTING 3,603 229 314 2,500 2,500 0 0.00%FURNITURE & OFFICE EQUIP. 0 0 0 200 200 0 0.00%GASOLINE ‐ UNLEADED 1,069 1,206 1,083 1,750 1,750 0 0.00%UNIFORMS 1,350 1,350 1,350 1,350 1,350 0 0.00%SEALER'S SUPPLIES 8,163 8,763 8,338 10,000 10,000 0 0.00%TOOLS AND EQUIPMENT 349 48 79 300 300 0 0.00%ZONING EXPENSES 1,590 1,389 724 2,000 2,000 0 0.00%PERMITS/LICENSES 0 700 700 700 700 0 0.00%TRAVEL ALLOWANCE 15,070 9,300 9,625 9,300 9,300 0 0.00%MILEAGE REIMBURSEMENT 154 162 0 250 250 0 0.00%DUES AND MEMBERSHIPS 915 480 380 1,000 1,000 0 0.00%SUBSCRIPTIONS 407 52 28 1,000 1,000 0 0.00%TOTAL OPERATING EXPENSES 46,166 34,386 34,074 44,000 44,000 0 0.00%

TOTAL INSPECTIONAL SERVICES 380,856 500,653 481,471 554,580 507,303 ‐47,277 ‐8.52%

INSPECTIONAL SERVICES

70

PUBLIC HEALTH


Provide staff to the Board of Health and act on its behalf

Monitor for and investigate causes of illness, educate communities to in‐form and empower, develop policies, enforce laws, ensure a competentworkforce, and provide continuous evaluation of all health programs

Environmental Health: Investigate health nuisances, conduct regulatoryprocess, issue ~300 permits, with inspections. Monitor issues of public con‐cern: vector control, sanitary housing, tobacco, and food safety

Public Health Nursing: Investigate reports of disease, co‐chair DanversCARES, promote community wellness, partner with Town depart‐ments in emergency planning and immunization clinics

Animal Health: Quarantine animals exposed to/exhibiting signs of rabies, inspect kennels and livestock; Animal Control Officer impoundsdogs, removes large roadkill

BUDGET COMMENTARY With the retirement of Peter Mirandi in March 2020 (who served as both Public Health Director and Director of Veterans’ Services), FY2022 marks the first year these services areas are budgeted as separate divisions – the reduction of $110,465 (or 23.68%) reflected here represents a transfer of personnel and related operating expenses to the new Veterans’ Service budget. This should not affect Public Health's level of service to the community, as health‐related services / activities are unchanged by this reorganization.


Adopted new regulations regarding animal keeping and revised rules per‐taining to body art

Comprehensive & unprecedented public health response to COVID‐19.The division assisted with contract tracing of exposed individuals, estab‐lished a local testing program, provided vaccinations, and enforced stateand local safety protocols


Resume normal business operations of the Division and the Board ofHealth

Continue to review for updates and modernize existing Board of Health Regulations

Public Health FTE FY2020 FY2021 FY2022

Public Health Director 1.00 1.00 1.00

Assistant Director of Public Health 1.00 ‐ ‐

Sanitarian ‐ 1.00 1.00

Public Health Nurse 0.75 0.75 0.75

Environmental Health Inspector 0.40 0.40 0.40

Animal Care Specialist 0.40 0.40 0.40

Total 3.55 3.55 3.55

71


S&W PERMANENT‐FULL TIME 233,643 241,017 248,869 285,328 154,721 ‐130,607 ‐45.77%S&W PERMANENT ‐ PART TIME 39,079 72,240 76,837 77,636 115,158 37,522 48.33%S&W ‐ TEMPORARY POSITIONS 1,978 0 1,260 3,600 2,400 ‐1,200 ‐33.33%OVERTIME 0 0 0 0 0 0 0.00%LONGEVITY 1,200 1,300 1,350 1,392 550 ‐842 ‐60.49%SICK LEAVE INCENTIVE 1,206 931 1,113 700 600 ‐100 ‐14.29%TOTAL SALARIES & WAGES 277,106 315,489 329,429 368,656 273,429 ‐95,227 ‐25.83%

SOFTWARE MAINTENANCE 4,440 5,015 4,949 5,075 5,000 ‐75 ‐1.48%TRAINING SERVICES 1,146 1,140 15 1,500 0 ‐1,500 ‐100.00%SENIOR HEALTH SERVICES 0 0 0 750 0 ‐750 ‐100.00%PUBLIC HEALTH SERVICES 4,444 89 581 10,000 10,000 0 0.00%YOUTH HEALTH SERVICES 3,524 1,891 1,454 0 0 0 0.00%ENVIRONMENTAL HEALTH ENFORCE. 10,595 10,766 7,766 13,800 14,000 200 1.45%COMMUNITY HEALTH EDUCATION 0 0 0 1,500 1,000 ‐500 ‐33.33%TELEPHONE 1,740 1,685 1,946 2,000 3,880 1,880 94.00%ANIMAL CONTROL 9,290 2,378 3,899 2,500 2,500 0 0.00%PEST CONTROL 28,376 31,168 29,533 33,500 32,500 ‐1,000 ‐2.99%GENERAL OFFICE SUPPLIES 0 0 1,227 600 1,000 400 66.67%FORMS PRINTING 790 0 463 1,000 500 ‐500 ‐50.00%GASOLINE ‐ UNLEADED 0 224 316 0 0 0 0.00%UNIFORMS 565 450 450 450 0 ‐450 ‐100.00%TOOLS AND EQUIPMENT 2,075 1,927 1,300 2,332 2,000 ‐332 ‐14.24%VETERAN'S CEREMONIES 5,894 7,519 6,831 8,500 0 ‐8,500 ‐100.00%TRAVEL ALLOWANCE 3,500 2,400 1,600 2,400 0 ‐2,400 ‐100.00%MILEAGE REIMBURSEMENT 1,997 1,661 1,367 2,350 2,000 ‐350 ‐14.89%CONFERENCE FEES 4,412 1,145 2,212 2,211 1,750 ‐461 ‐20.85%DUES AND MEMBERSHIPS 1,236 1,536 1,405 2,400 2,100 ‐300 ‐12.50%SUBSCRIPTIONS 359 819 1,020 1,000 400 ‐600 ‐60.00%TUITION REIMBURSEMENT 0 0 1,210 4,000 4,000 0 0.00%TOTAL OPERATING EXPENSES 84,383 71,812 69,546 97,868 82,630 ‐15,238 ‐15.57%

TOTAL HEALTH 361,489 387,300 398,975 466,524 356,059 ‐110,465 ‐23.68%

PUBLIC HEALTH

72

PLANNING & ECONOMIC DEVELOPMENT


Support regulatory boards, and bear responsibility for project permit‐ting, including wetlands protection, subdivision control, site plan ap‐proval, and special permit review, zoning administration, as well asadminister the demolition delay bylaw, Historic District regulations,and affordable housing policy

Lead zoning and market studies, and analyze and assist in land useplanning initiatives/community projects

Collaborate with local, regional, and international business ownersfor employment growth, economic development, and advancingbusiness location assistance

Respond to customer inquiries and provide education and guidanceas needed

BUDGET COMMENTARY

Salaries & Wages increases include personnel shift from Inspectional Services to support ZBA & zoning enforcement. Operating increase

related to software, the new and existing software will help staff stay current

with modern technology and the pace of the business world for economic

development purposes.


Successfully helped many restaurants, in the Downtown area and through‐out Town, operate during the health pandemic


Continued focus on regulation modernization and implementation of exist‐ing regulations and bylaws

Begin pre‐planning for land use recommendations for the CommercialIII/Endicott Corridor area

Planning & Economic Development FTE FY2020 FY2021 FY2022

Director of Planning & Economic Development 1.00 1.00 1.00

Principal Planner 1.00 1.00 1.00

Senior Staff Planner 1.00 ‐ ‐

Staff Planner ‐ 1.00 1.00

Senior Secretary 1.00 1.00 1.00

Regulatory Board Administrative Assistant ‐ ‐ 1.00

Secretary 0.67 0.67 ‐

Planning Technician ‐ ‐ 0.71

Total 4.67 4.67 5.71

73


S&W PERMANENT‐FULL TIME 265,768 275,695 265,009 293,619 382,230 88,611 30.18%S&W PERMANENT ‐ PART TIME 37,847 38,058 39,515 40,045 48,928 8,883 22.18%S&W ‐ TEMPORARY POSITIONS 26,679 22,895 600 6,240 6,240 0 0.00%OVERTIME 338 0 0 1,000 0 ‐1,000 ‐100.00%LONGEVITY 1,525 1,375 550 550 550 0 0.00%SICK LEAVE INCENTIVE 1,875 875 25 2,450 1,250 ‐1,200 ‐48.98%CLEANING ALLOWANCES 125 125 0 0 0 0 0.00%TOTAL SALARIES & WAGES 334,157 339,023 305,699 343,904 439,198 95,294 27.71%

OFFICE EQUIPMENT MAINTENANCE 4,979 0 2,962 500 600 100 20.00%SOFTWARE MAINTENANCE 0 0 0 2,500 7,000 4,500 180.00%MEDICAL EXAMS (EMPLOYEE) 0 180 310 0 0 0 0.00%CONSULTING SERVICES 32,375 12,683 7,470 20,000 22,500 2,500 12.50%ENGINEERING CONSULTANTS 8,494 7,900 5,257 15,000 15,000 0 0.00%TRAINING SERVICES 360 415 680 3,750 3,750 0 0.00%TELEPHONE 626 0 0 0 0 0 0.00%ADVERTISING 2,076 514 2,322 2,000 2,000 0 0.00%FITNESS CLUB MEMBERSHIPS 545 0 749 500 750 250 50.00%GENERAL OFFICE SUPPLIES 12,064 11,551 8,513 10,000 8,000 ‐2,000 ‐20.00%FORMS PRINTING 1,730 460 730 1,500 1,500 0 0.00%LUMBER AND HARDWARE 1,540 3,203 0 0 0 0 0.00%UNIFORMS 700 900 675 900 900 0 0.00%HISTORIC DISTRICT COMMISSION 470 337 0 0 0 0 0.00%PRESERVATION COMMISSION 785 1,198 0 0 0 0 0.00%HUMAN RIGHTS & INCLUSION COMMITTEE 0 1,200 0 1,600 0 ‐1,600 ‐100.00%MILEAGE REIMBURSEMENT 2,114 469 81 2,000 1,250 ‐750 ‐37.50%CONFERENCE FEES 609 1,923 1,525 3,500 3,500 0 0.00%PARKING, TOLLS, ETC. 123 0 42 300 300 0 0.00%DUES AND MEMBERSHIPS 1,387 2,251 2,038 6,500 6,500 0 0.00%SUBSCRIPTIONS 191 349 0 960 960 0 0.00%TUITION REIMBURSEMENT 1,520 5,208 0 5,000 5,000 0 0.00%MISC OTHER CHARGES & EXPENSES 245 130 437 0 0 0 0.00%TOTAL OPERATING EXPENSES 72,933 50,871 33,791 76,510 79,510 3,000 3.92%

TOTAL PLANNING 407,090 389,894 339,491 420,414 518,708 98,294 23.38%

PLANNING & ECONOMIC DEVELOPMENT

74

SENIOR & SOCIAL SERVICES


Nutrition: Daily on‐site congregate meals, Monday‐Friday. Meal delivery tohomebound, frail, and at‐risk elders Monday‐Friday with additional cold suppers and frozen meals available for weekends and holidays

Transportation: Services available to elders and under 60 disabled with in‐dividual appointments to local and out of area medicals and Adult Day pro‐grams. Volunteer Transportation Program to offset rising transportation costs

Social Services: Advocacy provided to residents of all ages. Assistance withapplication for food stamps, fuel assistance, housing, and health insurance counseling and other emergency needs

Volunteers: Encouragement of elders, students, and others to participate at the Senior Center and in the community at large

Adult Supportive Day Care: Provides a supervised environment to seniors who need individualized attention while caregivers benefitfrom much needed respite. Program is successfully operating as a self‐supporting, revenue generating program

Education/Social: Programs are offered to seniors who can pursue new interests and develop skills through a variety of educational andrecreational offerings

BUDGET COMMENTARY

There is an overall decrease of $11,924 or 2.96%, to reflect funding necessary to restart Café program at 3 days per week (instead of the 5

day per week goal that was disrupted by COVID).


During pandemic, outreach was made to seniors through virtual programs,

newsletters, nutrition program, safe reintroduction of transportation services

and drive thru events with meals and “isolation supplies”. Staff remained availa‐

ble to meet the needs of clients while working remotely and while building is

closed to public


• To plan, implement, and evaluate safe and appropriate programs that meet community needs and follow COVID‐19 guidelines

• Enhance the Divisions effectiveness and resiliency through increased focus on management protocols and development

Senior & Social Services FTE FY2020 FY2021 FY2022

Director of Social Services 1.00 1.00 1.00

Assistant Director (62.5% tax) 1.00 1.00 1.00

Volunteer/MOW Coordinator 0.75 0.75 0.75

Program Coordinator (50% tax) 1.00 1.00 1.00

Senior Secretary/Transport. Coord. (75% tax) 1.00 1.00 1.00

Receptionist 0.48 0.48 0.48

Total 5.23 5.23 5.23

75


S&W PERMANENT‐FULL TIME 140,558 156,282 226,163 250,977 254,720 3,743 1.49%S&W PERMANENT ‐ PART TIME 36,385 39,137 39,385 39,569 40,714 1,145 2.89%S&W ‐ TEMPORARY POSITIONS 46,105 46,578 56,415 72,128 60,129 ‐11,999 ‐16.64%OVERTIME 0 0 330 0 0 0 0.00%OVERTIME ‐ UNSCHEDULED 0 0 0 5,000 0 ‐5,000 ‐100.00%LONGEVITY 1,975 2,075 2,325 1,707 1,763 56 3.28%SICK LEAVE INCENTIVE 319 431 38 1,200 1,331 131 10.92%TOTAL SALARIES & WAGES 225,342 244,503 324,656 370,581 358,657 ‐11,924 ‐3.22%

OFFICE EQUIPMENT MAINTENANCE 498 0 1,829 2,000 2,000 0 0.00%VEHICLE MAINTENANCE 979 1,000 1,015 1,000 1,000 0 0.00%TRAINING SERVICES 600 341 500 980 980 0 0.00%TELEPHONE 346 191 235 500 500 0 0.00%GENERAL OFFICE SUPPLIES 852 885 1,000 1,000 1,000 0 0.00%GASOLINE ‐ UNLEADED 10,530 13,431 8,599 13,500 13,500 0 0.00%MILEAGE REIMBURSEMENT 6,767 10,219 6,421 10,000 10,000 0 0.00%CONFERENCE FEES 820 0 0 1,000 1,000 0 0.00%PARKING, TOLLS, ETC. 20 0 0 0 0 0 0.00%DUES AND MEMBERSHIPS 3,833 1,735 1,988 1,735 1,735 0 0.00%TOTAL OPERATING EXPENSES 25,245 27,802 21,588 31,715 31,715 0 0.00%

TOTAL SENIOR 250,587 272,305 346,244 402,296 390,372 ‐11,924 ‐2.96%

SENIOR & SOCIAL SERVICES

76

VETERANS’ SERVICES


Administer and distribute Massachusetts General Law, Chapter 115 Aid to eligible Danvers veterans

Ensure compliance with Ch. 115 rules to ensure Commonwealth returns 75% of Town expenditures

Assist eligible residents with US Veteran's Administration benefit applications

In conjunction with the Veteran's Council, coordinate and supervise the Town's Memorial Day and Veterans' Day observance

Ensure the Town's flags are flown in compliance with the US Flag Code

BUDGET COMMENTARY With the retirement of Peter Mirandi in March 2020 (who served as both Public Health Director and Veterans’ Services Officer), FY2022 marks the first year these services areas are budgeted as separate divisions. The funding for this budget was transferred out of the Health Division budget.


Due to the COVID‐19 pandemic, both our Memorial Day and Veterans Day celebration were successfully held virtually. Thank you to Danvers Cable Access Television and the Danvers' Police Department for their assistance with these very successful events

Distributed food to 40‐60 veterans and their families with the Food4Vet's program, which has been held rain or shine, every other week throughout FY2021


Strengthen outreach to our local veterans to inform them of available programs and assistance

Continue to improve the level of service our veterans receive through developing internal policies and procedures for the new division

Veterans’ Services FTE FY2020 FY2021 FY2022

Veterans’ Services Officer ‐ 1.00 1.00

Social Service/Outreach Coordinator (50% tax) 1.00 1.00 1.00

Senior Secretary 0.40 0.40 0.40

Total 1.40 2.40 2.40

77


S&W PERMANENT‐FULL TIME 0 0 0 0 99,986 99,986 100.00%S&W PERMANENT ‐ PART TIME 0 0 0 0 28,051 28,051 100.00%LONGEVITY 0 0 0 0 1,075 1,075 100.00%SICK LEAVE INCENTIVE 0 0 0 0 888 888 100.00%TOTAL SALARIES & WAGES 0 0 0 0 130,000 130,000 100.00%

SOFTWARE MAINTENANCE 0 0 0 0 500 500 100.00%TELEPHONE 0 0 0 0 500 500 100.00%GENERAL OFFICE SUPPLIES 0 0 0 0 1,000 1,000 100.00%FORMS PRINTING 0 0 0 0 500 500 100.00%VETERAN'S CEREMONIES 0 0 0 0 8,500 8,500 100.00%MILEAGE REIMBURSEMENT 0 0 0 0 250 250 100.00%CONFERENCE FEES 0 0 0 0 1,200 1,200 100.00%DUES AND MEMBERSHIPS 0 0 0 0 300 300 100.00%SUBSCRIPTIONS 0 0 0 0 200 200 100.00%TUITION REIMBURSEMENT 0 0 0 0 4,000 4,000 100.00%TOTAL OPERATING EXPENSES 0 0 0 0 16,950 16,950 100.00%

TOTAL VETERANS' SERVICES 0 0 0 0 146,950 146,950 100.00%

VETERANS' SERVICES

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RECREATION


Plan, organize and implement year‐round recreation programs and community services

Oversee operations of the Danvers Recreation, Childcare, Waterfront, Endicott Park

Collaborate with the DPW Grounds Division on grounds improvements.

Maintain and manage town open space areas

BUDGET COMMENTARY Maintains current level of staffing, programming, and services. The personnel budget includes modest adjustments to pay rates for tempo‐rary staffing to stay competitive.


Opened the new Pavilion at Endicott Park

Operated a successful and safe summer program at three in town locations during the pandemic

Partnered with the Danvers Public Schools to provide an in person Remote Learning Program for grades 1‐8 held in the Vye Gym at Dan‐vers High School


To plan, implement and evaluate, safe and appropriate recreational and childcare programsand services for the Town of Danvers that meet the needs of the community while followingall local and state covid and health related guidelines

Collaborate with other town departments, community groups, and vendors on maintenanceand capital improvement projects

Permit and schedule all Town Ball fields in a fair and equitable manner

Maintain and provide park services at Endicott Park to over 200,000 park visitors annually

Oversee all waterfront activities, operations, and permitting to over 800 boats

Put in service a new to Danvers used patrol/fire boat, replacing a 34‐year‐old patrol boat

Recreation FTE FY2020 FY2021 FY2022

Recreation Director 1.00 1.00 1.00

Assistant Recreation Director 1.00 1.00 1.00

Director of Natural Resources 1.00 1.00 1.00


Endicott Park Coordinator 1.00 1.00 1.00

Endicott Park Ranger Foreman 2.00 2.00 2.00

Total 7.00 7.00 7.00

79


S&W PERMANENT‐FULL TIME 400,786 480,405 506,903 514,217 540,114 25,897 5.04%S&W PERMANENT ‐ PART TIME 18,727 16,993 15,838 18,564 19,314 750 4.04%S&W ‐ TEMPORARY POSITIONS 168,382 159,091 193,287 227,353 234,549 7,196 3.17%OVERTIME 10,654 11,366 10,094 5,593 6,291 698 12.48%OVERTIME ‐ UNSCHEDULED 0 0 0 3,753 4,251 498 13.27%LONGEVITY 1,500 2,250 3,550 3,600 3,500 ‐100 ‐2.78%OUT OF RANGE 0 0 1,365 0 0 0 0.00%SICK LEAVE INCENTIVE 975 1,575 725 1,575 1,200 ‐375 ‐23.81%TOTAL SALARIES & WAGES 601,024 671,679 731,762 774,655 809,219 34,564 4.46%

ELECTRICITY 2,757 3,005 3,000 3,700 3,700 0 0.00%VEHICLE MAINTENANCE 600 12,299 11,111 10,750 10,750 0 0.00%SOFTWARE MAINTENANCE 5,959 8,451 8,441 8,500 8,500 0 0.00%TRAINING SERVICES 2,694 1,269 1,959 2,086 2,086 0 0.00%TELEPHONE 939 683 75 1,100 1,100 0 0.00%GENERAL OFFICE SUPPLIES 0 5,420 3,491 5,500 5,500 0 0.00%FORMS PRINTING 5,001 5,392 2,054 8,165 8,300 135 1.65%BEACH SAND 0 0 1,631 1,800 1,800 0 0.00%ENDICOTT PARK MAINTENANCE 0 24,923 24,121 24,535 24,535 0 0.00%MISC. GROUNDS MAINTENANCE 0 0 2,583 2,583 3,783 1,200 46.46%PLAYGROUND EQUIPMENT REPAIRS 0 7,985 9,134 22,616 22,616 0 0.00%ENDICOTT PARK BARN 0 11,240 10,417 10,800 11,100 300 2.78%ENDICOTT DOG PARK 0 4,074 5,722 6,058 6,058 0 0.00%GASOLINE ‐ UNLEADED 2,544 6,344 6,011 9,532 9,532 0 0.00%UNIFORMS 0 0 650 900 900 0 0.00%TOOLS AND EQUIPMENT 14,010 10,585 14,517 11,500 12,600 1,100 9.57%FIELD HOUSE SUPPLIES 600 267 0 0 0 0 0.00%RECREATION ‐ PROGRAM EXPENSES 23,552 23,582 27,292 26,618 26,618 0 0.00%RECREATION ‐ HARBOR EXPENSES 10,032 12,775 13,287 13,200 13,200 0 0.00%MILEAGE REIMBURSEMENT 2,803 2,320 2,301 3,200 3,200 0 0.00%CONFERENCE FEES 4,906 4,564 5,626 4,300 4,300 0 0.00%DUES AND MEMBERSHIPS 1,463 950 1,528 1,100 1,100 0 0.00%TUITION REIMBURSEMENT 9,898 5,183 3,653 0 0 0 0.00%TOTAL OPERATING EXPENSES 87,758 151,310 158,604 178,543 181,278 2,735 1.53%

TOTAL RECREATION 688,782 822,990 890,366 953,198 990,497 37,299 3.91%

RECREATION

80

PEABODY INSTITUTE LIBRARY


The Peabody Institute Library of Danvers is a center for community and curiosity that strengthens our town by enabling all residents to pursue their

interests. The Library curates a collection of books, movies, music, magazines, toys, tools, games, musical instruments, museum passes, and more,

hosts hundreds of events each year, including story times, concerts, art shows, lectures, film screenings, and more, all of which are free to attend,

provides research assistance and technology training, and, through its Archival Center collects, preserves, and makes available material relating to

the history and development of the Town of Danvers and Essex County.

BUDGET COMMENTARY

The Library’s FY2022 operating budget will provide sufficient operational funding to allow us to provide collections, programs, and services that

benefit the Danvers Community. The Library will use supplemental funds from State Aid and the Peabody Trust to purchase materials, support pro‐

gramming, provide professional development opportunities for staff, and enable capital improvements. Additionally, the Library will pursue grant

and fundraising opportunities and will work with the Friends of the Library, who help the Library serve Danvers through fundraising and volunteer

support.


Collaboratively planned, developed, launched, and managed host of socially distanced, remote, and virtual services, including pickup services, remote research assistance, tech support, readers’ advisory via email and phone, virtual programming, and more.

Expanded the eLibrary and saw over 75% usage increase over FY2020

Tackled massive backlog of returned materials and new deliveries resulting from initial COVID‐19 closure in Spring 2020

Transformed yearly spring staff training day into a self‐paced training packet to be completed remotely


Continue to provide and expand library services to the commu‐nity while prioritizing the health and safety of staff and public

Evaluate COVID‐era services and determine what services will be maintained in a post‐COVID environment

Complete inventory of entire library collection

81


S&W PERMANENT‐FULL TIME 772,717 837,972 831,317 893,512 934,839 41,327 4.63%S&W PERMANENT ‐ PART TIME 29,897 30,744 31,239 31,707 32,961 1,254 3.95%S&W ‐ TEMPORARY POSITIONS 214,683 218,536 213,250 244,233 221,398 ‐22,835 ‐9.35%LONGEVITY 7,500 7,700 6,500 6,750 6,900 150 2.22%SICK LEAVE INCENTIVE 4,505 4,555 3,905 5,200 4,625 ‐575 ‐11.06%TOTAL SALARIES & WAGES 1,029,302 1,099,507 1,086,212 1,181,402 1,200,723 19,321 1.64%

OFFICE EQUIPMENT MAINTENANCE 7,608 0 0 0 0 0 0.00%TELEPHONE 1,251 1,069 1,531 2,000 2,500 500 25.00%POSTAGE 504 698 702 750 750 0 0.00%NOBLE‐MEMBERSHIP FEES 44,082 45,338 45,322 45,916 45,916 0 0.00%NOBLE‐TECHNOLOGY FEES 0 10,561 9,558 10,490 10,490 0 0.00%NOBLE‐E‐LIBRARY FEES 0 20,769 20,342 20,471 20,471 0 0.00%GENERAL OFFICE SUPPLIES 9,826 10,000 11,738 20,000 20,000 0 0.00%AUDIO VISUAL MATERIAL 15,612 0 0 0 0 0 0.00%LIBRARY MATERIALS 175,168 193,677 194,889 218,000 230,000 12,000 5.50%PERIODICALS 14,603 0 0 0 0 0 0.00%TOTAL OPERATING EXPENSES 268,654 282,111 284,082 317,627 330,127 12,500 3.94%

TOTAL LIBRARY 1,297,956 1,381,617 1,370,294 1,499,029 1,530,850 31,821 2.12%

LIBRARY

82

DEBT SERVICE

OVERVIEW

The use of long‐term debt is an effective way to finance major infrastructure and equipment needs. Proper debt management can

help maintain a solid credit rating, enhance flexibility in current and future operating budgets, and provide the Town with long‐term

assets that maintain or improve the quality of life of Danvers residents.

Conversely, long‐term debt establishes a fixed obligation for many years. This long‐term obligation impacts both current and future

residents. Accumulation of these fixed obligations can put a burden on the Town’s ability to pay future operating costs or debt service.

It is crucial, therefore, that the Town effectively plans for any long‐term borrowing.

The Board of Selectmen adopted a Debt Policy on March 3, 2016. The purpose of the policy is to formalize the guidelines governing

the use of long‐term debt and to demonstrate the Town of Danvers’ commitment to full and timely repayment of all debt issued. To

view the Debt Policy and all other financial policies, please visit the Town of Danvers’ website at www.danversma.gov. In 2021, Stand‐

ard & Poor’s reaffirmed the Town of Danvers its first AAA rating, in part due to its proper debt management policies.

Education77.23%

Planning (Land Acquisition)

1.68%

DPW (Landfill)3.79%

Recreation0.97%

Library2.44%

Public Safety8.14%

Town Hall5.75%

FY2022 DEBT SERVICE BY CATEGORY

83

Maturing Debt and Interest Principal Interest Budget

Smith School HVAC 1,033,000 Nov. 2003 FY2020 61,700 55,550 ‐ ‐ ‐ ‐

HS/MS HVAC (rfdg) 300,800 Nov. 2003 FY2022 16,050 15,750 15,450 15,000 150 15,150

School Remodeling 1,057,000 March 2005 FY2022 64,200 63,000 61,800 60,000 600 60,600

Middle School 11,251,000 July 2006 FY2026 746,960 727,441 694,121 608,000 62,090 670,090

Middle School 1,937,841 July 2008 FY2026 151,208 136,804 127,300 105,000 18,100 123,100

School Roof 528,000 July 2008 FY2026 38,600 37,400 36,225 30,000 5,000 35,000

Great Oak Roof 626,074 July 2014 FY2035 42,250 41,363 40,388 30,000 14,300 44,300

Thorpe School Roof 637,000 July 2010 FY2028 53,031 46,156 44,407 26,900 14,830 41,730

DHS Remodeling (1) 4,600,000 July 2014 FY2035 310,225 310,525 309,750 205,000 108,750 313,750

DHS Remodeling (2) 23,525,000 July 2011 FY2037 1,902,221 1,900,646 1,897,647 970,000 931,297 1,901,297

DHS Athletic Fields 4,220,000 Aug. 2017 FY2031 622,564 505,175 488,925 325,000 147,675 472,675

Smith School Construction 18,015,000 Aug. 2019 FY2040 ‐ 361,000 1,272,875 590,000 679,000 1,269,000

Highlands School Roof (1&2) 1,154,000 Aug. 2020 FY2041 ‐ ‐ ‐ 5,000 55,682 60,682

Land Acquisition 1,223,869 July 2014 FY2035 83,125 81,875 80,375 50,000 28,875 78,875

Land Acquisition (Liberty St) 565,000 Nov. 2003 FY2022 32,100 31,500 30,900 30,000 300 30,300

Land Acquisition (Choate) 1,320,000 Dec. 2001 FY2020 66,950 65,650 ‐ ‐ ‐ ‐

‐

Landfill Closure 1,798,000 July 2010 FY2031 133,013 128,513 124,013 64,500 49,215 113,715

Landfill Gas Extract. 1,981,344 July 2014 FY2035 133,825 131,825 134,350 85,000 46,800 131,800

Dredging 615,320 July 2008 FY2023 52,300 50,500 43,800 40,000 2,200 42,200

Thorpe Athletic Fields 280,000 July 2010 FY2024 28,906 22,781 21,782 18,500 2,325 20,825

Library Remodel 1,334,000 Dec. 2001 FY2020 66,350 35,350 ‐ ‐ ‐ ‐

Library HVAC 1,867,000 Aug. 2017 FY2038 213,757 167,525 162,775 95,000 63,025 158,025

Fire ‐ Aerial Platform 1,078,000 Aug. 2017 FY2032 158,113 125,500 121,500 80,000 37,500 117,500

Dispatch Center Construction 4,908,000 Aug. 2017 FY2038 558,491 434,875 422,625 245,000 165,375 410,375

Town Hall 6,000,000 June 2009 FY2029 429,204 396,302 384,600 290,000 83,000 373,000

Cost of Bonds 17,245 6,736 50,000 ‐ 50,000 50,000

Interest of Temp. Loans 20,253 102,085 74,824 ‐ 125,000 125,000

Transfer to Schools 596,252 6,002,641 6,578,079 6,640,432 3,967,900 2,691,089 6,658,989 Total Debt Service (General Fund)

FY21 Budget

DEBT SERVICE (GENERAL FUND)

Amount Issued

Issue

Date

Maturity

DateFY19 Actual FY20 Actual

FY22

84

Health, Dental,

and Life Insurance

Workers'

Compensation

Casualty and

LiabilityMedicare/FICA Unemployment Veterans' Aid

Total by

Department

Tax Supported 11,876,712$ 500,000$ 409,689$ 1,045,627$ 25,000$ 160,000$ 14,017,028$

Water 406,135$ 87,000$ 100,000$ 18,000$ 25,000$ ‐$ 636,135$

Sewer 71,268$ ‐$ ‐$ 2,500$ 400$ ‐$ 74,168$

Electric * 823,705$ 195,000$ 194,900$ 63,000$ 92,000$ ‐$ 1,368,605$

Total Cost by Category 13,177,820$ 782,000$ 704,589$ 1,129,127$ 142,400$ 160,000$ 16,095,936$

Health, Dental, and Life

InsuranceFY2021 Budget FY2022 Proposed $ Increase % Increase

Tax Supported 11,918,265$ 11,876,712$ (41,553)$ ‐0.35%

Water 406,135$ 406,135$ ‐$ 0.00%

Sewer 51,067$ 71,268$ 20,201$ 39.56%

Electric * 820,453$ 823,705$ 3,252$ 0.40%

Total Cost by Category 13,195,920$ 13,177,820$ (18,100)$ ‐0.14%

* Calendar Year 2021 Budget

Budget Changes:

Notes:

BENEFITS & INSURANCE

The costs associated with the tax supported share of the Town's Benefits & Insurance costs are appropriated in the Employee Benefits & Insurance budget. The costs related to the

utility divisions of Public Works are included in the Water, Sewer, and Electric budgets, respectively. The Town pays 70% of employee health care premiums and 50% of the premiums for dental and basic life insurance for both active employees and retireees. Workers'

Compensation and Unemployment are self‐insured programs.

All employees hired after April 1986 are required by Federal Law to pay, and for the Town to match, 1.45% of salary to Medicare.

Casualty and Liability Insurance is funded through a combination of self‐insurance and premium‐based programs.

The Fiscal Year 2022 Benefits and Insurance budgets reflect a full year of changes in our insurance carrier as well as plan design changes. The health insurance figure is based on a

2.9% expected premium increase partially offset by benefit changes such as the opt‐out program and a potential premium holiday offered by MIIA.

85


CASUALTY/LIABILITY INSURANCE 263,349 309,351 341,806 375,180 409,689 34,509 9.20%EMPLOYEE INSURANCE 11,113,410 11,666,225 11,796,552 11,880,957 11,839,404 ‐41,553 ‐0.35%LIFE INSURANCE 31,472 35,845 30,854 37,308 37,308 0 0.00%MEDICARE/FICA INSURANCE 765,518 799,650 821,707 879,615 914,800 35,185 4.00%MEDICARE SURCHARGE PREMIUM 115,575 111,830 106,904 130,827 130,827 0 0.00%HOSPITAL ADMISSION DEDUCTABLE 63,950 0 0 0 0 0 0.00%VETERANS AID 154,952 149,151 142,312 172,500 160,000 ‐12,500 ‐7.25%TOTAL 12,508,226 13,072,052 13,240,135 13,476,387 13,492,028 15,641 0.12%

TRANSFER TO UNEMPLOYMENT FUND 50,000 25,000 25,000 25,000 25,000 0 0.00%TRANSFER TO WORKERS COMP FUND 400,000 450,000 500,000 500,000 500,000 0 0.00%TRANSFER TO OPEB TRUST 0 0 0 0 0 0 0.00%TOTAL 450,000 475,000 525,000 525,000 525,000 0 0.00%

TOTAL BENEFITS & INSURANCE 12,958,226 13,547,052 13,765,135 14,001,387 14,017,028 15,641 0.11%

BENEFITS & INSURANCE

86

RETIREMENT

DEPARTMENT DESCRIPTION The Danvers Retirement Board is responsible for the administration of the Danvers Retirement System, which covers 900+ active and retired members of the Town of Danvers and the Danvers Housing Authority. There is a five‐member board that meets monthly, is independently governed, and is administered by the Town’s Director of Administration and Finance

Appointed Member: Wayne P. Marquis (Chairperson) Ex Officio Member: Heather Varney Elected Member: Dana M. Hagan Elected Member: Joseph L. Collins Fifth Member: Stephen T. Swanson

Retirement System staff maintain member and retiree databases; process retirement and disability applications; counsel employees regarding retirement options and future benefits; process and maintain retiree payroll; maintain system accounting and investment activity; implement legislative changes; and process actuarial valuations

BUDGET COMMENTARY The major component of this budget is the retirement assessment that is determined by an actuarial valuation and approved by the Public Employee Retirement Administration Commission (PERAC)


Completed the Retirement System funded Financial Audit for CY2019. The audit was clean and consisted of noaudit comments/management letter

Completed the 1/1/2020 full Retirement Actuarial Valuation and GASB 67 & 68 Disclosures

Completed 1/1/2020 GASB 74/75 OPEB Valuation with 6/30/2020 disclosers related to Other Post‐EmploymentBenefits (OPEB)


Hold election for the 3rd seat on the Retirement Board which was cancelled due to COVD‐19

Complete the annual GASB 67 and GASB 68 disclosures, as of December 31, 2020

Retirement FTE FY2020 FY2021 FY2022

Retirement Manager 1.00 1.00 1.00

Retirement Office Assistant 0.50 0.57 0.57

Total 1.50 1.57 1.57

87

Town of Danvers

Contributory Retirement System

Budget Analysis

FY21 Budget FY22 Budget $ Change % Change

General

Government (Tax

Supported)

Water Division Sewer Division Electric Division Housing Authority TOTAL

84.96% 3.87% 0.44% 8.85% 1.88% 100.00%

Salary & Wages 122,000$ 127,000$ 5,000 4.1% 107,894$ 4,917$ 562$ 11,239$ 2,388$ 127,000$

Custodial Services 68,000$ 69,000$ 1,000 1.5% 58,619$ 2,671$ 305$ 6,106$ 1,298$ 69,000$

Legal Services 5,000$ 5,000$ 0 0.0% 4,248$ 194$ 22$ 442$ 94$ 5,000$

Office Expenses 7,500$ 7,500$ 0 0.0% 6,372$ 290$ 33$ 664$ 141$ 7,500$

Software/Comp. Maint. 28,500$ 31,165$ 2,665 9.4% 26,476$ 1,207$ 138$ 2,758$ 586$ 31,165$

Fiduciary Insurance 7,725$ 7,800$ 75 1.0% 6,627$ 302$ 35$ 690$ 147$ 7,800$

Investment Consultant 75,000$ 75,000$ 0 0.0% 63,717$ 2,904$ 332$ 6,637$ 1,410$ 75,000$

Actuarial Study 10,250$ 10,750$ 500 4.9% 9,133$ 416$ 48$ 951$ 202$ 10,750$

Training, Meetings, etc. 4,500$ 4,500$ 0 0.0% 3,823$ 174$ 20$ 398$ 85$ 4,500$

Other Expenses 206,475$ 210,715$ 4,240 2.1% 179,015$ 8,158$ 932$ 18,647$ 3,963$ 210,715$

‐$

Contributory Retirement 7,902,628$ 8,665,976$ 763,348 9.7% 7,413,668$ 328,599$ 45,559$ 722,710$ 155,440$ 8,665,976$

Total Budget 8,231,103$ 9,003,691$ 772,588 9.4% 7,700,576$ 341,674$ 47,053$ 752,596$ 161,791$ 9,003,691$

FY21 7,164,259$ 288,921$ 52,321$ 577,218$ 148,385$ 8,231,103$

Change 536,317$ 52,753$ (5,267)$ 175,379$ 13,406$ 772,588$

% Change 7.49% 18.26% ‐10.07% 30.38% 9.03% 9.39%

Danvers Retirement Board Approved at December 30, 2020 Meeting

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89

CAPITAL IMPROVEMENT PLAN

Town of Danvers Office of the Town Manager

Steve Bartha | Town Manager 1 Sylvan Street, Danvers, Massachusetts 01923 | p: 978-777-0001 | f. 978-777-1025 www.danversma.gov | [email protected]

This year’s operating budget includes, for the second time, a detailed Capital Improvement Plan section. The Town has maintained its physical assets very well for many years, so much so that as part of the Smith School project, we were awarded additional reimbursement points based on our ability to maintain such infrastructure. The Capital Improvement Plan section of the budget allows us to share our short and long‐term capital costs and plans in an easy‐to‐follow document for interested citizens and other stakeholders.

What is a Capital Improvement Plan? Infrastructure, technology, and major equipment are the physical foundation for providing services to constituents. Planning for and financing the replacement, repair, and acquisition of capital assets is a critical component of any municipality's budget and operations. Prudent planning and funding of capital assets ensure that a municipality can provide quality public services in a financially sustainable manner. A balance must be maintained between operating and capital budgets to meet the needs of both to the maximum extent possible. The development of a Capital Improvement Plan is the mechanism that a municipality uses to identify projects, prioritize funding, and create a long‐term financing plan that can be achieved within the limitations of the budget environment. Long‐term capital planning is another one of the important local government financial practices that credit rating agencies evaluate when assessing municipalities for credit worthiness.

The Capital Improvement Plan for the Town of Danvers is a rolling 5‐year plan that shows anticipated needs and funding sources for the General Fund as well as Water & Sewer Enterprise Funds. The plan also provides greater detail on year one of the plan as these are the projects being officially proposed for appropriation. In terms of the authorization year, FY2022, the capital improvement plan proposes appropriations of $1,858,235 from Free Cash; $694,000 from Sewer; $959,000 from Water and $8,000 from WUMP.

Some of the material in the Capital Improvement Plan the Town has routinely provided in the operating budget and warrant book, however this consolidates the information and provides additional context.

90

CAPITAL IMPROVEMENT PLAN RECOMMENDATIONS

The Town of Danvers maintains a large number of capital assets that require investment to preserve good working order and reliability. While these needs are evaluated throughout the year, staff begins preparing a detailed Capital Improvement Plan (CIP) in November for the upcoming May Town Meeting. This year, the team met several times as a group and with various departments to compile the lists of capital requests that would be funded in FY2022 as well as the full five years of the CIP. This is done by balancing long‐term needs with current and future estimates of funding ability. Due to the pandemic and its financial impact, this year’s capital needs were built with a goal of conserving funding as a base for next year’s needs as well, should current year Free Cash end up being notably lower than prior years.

The Town’s Department Heads submitted CIP requests totaling $7.03 million for FY2022. Those requests were thoroughly discussed and considered during a series of internal group and individual review sessions. Based on the results of those sessions and the projected availability of funds as of this date, the Town recommends a total FY2022 CIP of $3,519,235 for the following programs:

Program FY2022 Requested FY2022 Proposed

Building Improvements $367,000 $185,000

Grounds Improvements $328,150 $90,500

Pavement Management & Sidewalk Improvements $303,000 $248,000

Technology Plan $350,000 $250,000

General Fund Capital Projects $175,000 $175,000

Capital Outlay ‐ Vehicles $954,956 $746,985

Capital Outlay ‐ Equipment $361,758 $286,750

Sewer Enterprise Fund $1,437,500 $630,000

Water Enterprise Fund $2,757,000 $907,000

Grand Total $7,034,364 $3,519,235

91

CAPITAL IMPROVEMENT PLAN PROJECT LIST AND FUNDING SUMMARY

The above section details the programs included in the Town’s proposed CIP for Fiscal Year 2022. Within these overarching programs there are multiple projects, funded from various sources. These funding sources include:

• Free Cash‐ The Department of Revenue (DOR) states that Free Cash, as a nonrecurring revenue source, should be restricted to paying one‐time expenditures, funding capital projects, or replenishing reserves.

• Borrowing – the Town will issue debt and amortize the repayment of the costs over a number of years. Projects utilizing this source must fall within the Town’s overall debt structure and policy.

• Enterprise Funds: These funds are sourced through the revenue generated through the rates that support the associated services. These are generally appropriated via the enterprise fund’s retained earnings.

• Other Available Revenue – These are funds that are generated through other means such as public or private grants.

• WUMP ‐The Town of Danvers is required by its Modified Water Withdrawal Permit, issued pursuant to the Water Management Act, to institute and manage a Water Use Mitigation Program (WUMP).

Building Improvements These include costs related to the repair, maintenance, and improvements to Town buildings.

Grounds Improvements These include costs for improvements to and maintenance of Town properties, athletic facilities, playgrounds and equipment, and related costs, including construction, reconstruction, replacement, or purchase of equipment or supplies.

Project FY22 Proposed Funding Source

Holten Richmond Middle School Copper Roof Replacement 50,000$ Free Cash

Generator Transfer Switch at Engine #2 45,000$ Free Cash

Riverside School Roof Study and Test Cuts 30,000$ Free Cash

Riverside Classroom Carpet Replacement with VCT 20,000$ Free Cash

Building Modifications 20,000$ Free Cash

Classroom Modifications 20,000$ Free Cash

Grand Total 185,000


Endicott Park ‐ Children's Barn Repairs 27,500$ Free Cash

Danvers High School Tennis Courts 27,000$ Free Cash

Plains Park ‐ Brown and Memorial Field Repairs 20,000$ Free Cash

Rail Trail Maintenance and Surfacing 8,000$ Free Cash

Water Bubbler Replacement 8,000$ WUMP

Grand Total 90,500

92

Pavement Management & Sidewalk Improvements These include costs associated with a pavement management program including consulting services, computer programs, crack sealing, sidewalk improvements, and the reconstruction of Town ways.

Technology Plan These include costs associated with the purchase, installation, and maintenance of hardware and software for telecommunications, computers, and related networking equipment for various Town departments.

General Fund Capital Projects These include some of our larger one‐time projects as well as projects developed by our Engineering staff.


Miscellaneous Sidewalk Repairs 75,000$ Free Cash

Miscellaneous Paving Repairs 55,000$ Free Cash

Roadway Crack Sealing 45,000$ Free Cash

Bituminous Curbing Replacement 28,000$ Free Cash

ADA Improvements 25,000$ Free Cash

Thorpe Driveway Exit to Grapevine Road 20,000$ Free Cash

Grand Total 248,000


General Government ‐ Office 365 52,000$ Free Cash

General Government ‐ Servers 50,000$ Free Cash

Schools ‐ Interactive Educational Display Panels 39,064$ Free Cash

General Government ‐ Senior Center Phone System 30,000$ Free Cash

Schools ‐ Switching Infrastructure 30,000$ Free Cash

Schools ‐ High School Auditorium Projector Replacement 16,936$ Free Cash

Schools ‐ Desktop Replacements 14,000$ Free Cash

General Government ‐ Social Media Archiving 5,000$ Free Cash

Library ‐ Replacement Cycle 5,000$ Free Cash

Library ‐ Software Licensing 5,000$ Free Cash

Library ‐ Misc Tech Supplies 2,000$ Free Cash

Library ‐ Laptop and Tablets 1,000$ Free Cash

Grand Total 250,000


School Phone System Replacement 150,000$ Free Cash

John L. George Park Gangway Improvements & Bank Stabilization 25,000$ Free Cash

Grand Total 175,000

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Capital Outlay Capital Outlay in the Operating Budget represents costs that are annual in nature but provide fixed assets to the Town that have useful life beyond the fiscal year which the Operating Budget generally represents.

Capital Outlay Vehicles

Capital Outlay Equipment

Sewer Enterprise Fund These are costs relate to the maintenance of a sewer enterprise and wastewater system including engineering, specifications and bidding documents, materials, equipment and construction associated with the costs of upgrading and improving the existing sewer throughout the Town.


Police Vehicles (4) 214,985$ Free Cash

36K GVW 6‐Wheel Dump w/Plow 188,000$ Free Cash

School Passenger Van (2) 65,000$ Free Cash

Fire Prevention Vehicle 55,000$ Free Cash

Generator 50,000$ Sewer

Tractor 46,000$ Free Cash

3/4 Ton DBL Cab Pick‐up w/Plow 45,000$ Free Cash

3/4 Ton Pick‐up w/Plow & Lift Gate 45,000$ Free Cash

SUV/EV 38,000$ Water

Grand Total 746,985


Fire Portable Radios (18) 123,750$ Free Cash

Message Board 42,000$ Multiple

Police Body Armor 40,000$ Free Cash

Mower w/ Rough Mower Attachment 27,000$ Free Cash

Mower (2) 24,000$ Free Cash

Mower 48" w/ Hopper Gas Engine 20,000$ Free Cash

22' Trailer (for sidewalk paver and equipment) 10,000$ Free Cash

Grand Total 286,750


Frost Fish Brook Cleaning & Bank Stabilization 405,000$ Sewer

Flushing & Cleaning Sewer Lines & CCTV Inspections 200,000$ Sewer

Drainage Maintenance 25,000$ Sewer

Grand Total 630,000

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Water Enterprise Fund These are costs related to design, permitting, construction, and services during construction for upgrades, additions, and maintenance to the existing water distribution storage and supply network within the Town’s Water Distribution System.

The total FY2022 proposed funding summary by revenue source is as follows:


Emergency Water Interconnections 412,000$ Water

State Hospital Reservoir Valve Replacement & Vault Rehabilitation 345,000$ Water

Lakeview Booster Station 150,000$ Water

Grand Total 907,000

Funding Source Totals

Free Cash 1,858,235$

Capital Outlay‐ Vehicles 658,985$

Capital Outlay‐ Equipment 258,750$

Technology Plan 250,000$

Pavement Management & Sidewalk Improvements 248,000$

Building Improvements 185,000$

General Fund Capital Projects 175,000$

Grounds Improvements 82,500$

WUMP 8,000$


Sewer Funds 694,000$

Sewer Retained Earnings 630,000$

Sewer Operating 64,000$

Water Funds 959,000$

Water Retained Earnings 907,000$

Water Operating 52,000$

Grand Total 3,519,235$

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CAPITAL IMPROVEMENT PLAN PROJECT DESCRIPTIONS

Holten Richmond Middle School Copper Roof Replacement: A section of copper roofing on the historic section of HRMS has become damaged due to a severe storm. This section will be replaced to prevent current leaks from entering into the third‐floor classrooms and causing wall and ceiling damage. The estimated replacement cost is $50,000. Generator Transfer Switch at Engine #2: The generator at Engine 2 is 40‐years old and has outlived its useful life. Replacement parts are no longer available, and DPW has been using replacements parts from old systems, but the availability of those supplies has diminished. Replacement costs for this system are expected to be $45,000. Riverside School Roof Study and Test Cuts: The roof is now 25 years old. A thorough roof study is required prior to submitting a Statement of Interest to the MSBA, in order to be considering under the MSBA’s Accelerated Repair Program. The estimated study cost is $30,000. Riverside Classroom Carpet Replacement with VCT: The carpet in the academic wing is original to the renovation in 1996, has outlived its life expectancy, and the solution is to replace the remaining areas of carpet with VCT flooring. $20,000. Building Modifications: Throughout the year, the need exists to modify workspaces and offices in Town buildings. There are also unplanned repairs that need to be made throughout the year. The estimated ongoing cost for these modifications and/or repairs is $20,000 per year. Classroom Modifications: Minor renovation, including but not limited to electrical upgrades, storage improvements, and wall partitions, are needed in several schools. These renovations are needed due to enrollment and program changes, and the additional use of the school buildings during the year. The total cost of this project is $20,000.

Endicott Park‐ Children’s Barn Repairs: The Children’s Barn at Endicott Park (circa 1910) has undergone a recent facelift thanks to generous community contributions to the Friends of Endicott Park. In consideration of the renovation work, it was agreed that the Town would contribute to the roof repairs. The existing roof is layered asphalt shingles with cedar shake roof below that will require removal before a new roof can be put into place. Other small exterior façade improvements including siding and paint associated with the roof repairs will also be completed. The Friends of Endicott Park, Inc. have raised and contributed more than $125,000 in funds to renovate the Children's Barn. A $27,500 appropriation would represent a roughly 15% town investment in the estimated $177,000 project and complete the renovations. The cost of this project is $27,500.

Program Area Building Improvements

Project Title Various

FY2022 Projected Cost $185,000

Funding Source Free Cash

Program Area Grounds Improvements



Funding Source Free Cash ‐ $82,500; WUMP ‐ $8,000

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Danvers High School Tennis Courts: DHS tennis courts were installed in 2015 as part of the High School athletic renovation project. After six years, the courts are showing their age with two significant issues: approximately 120’ of cracks in need of repair and the surfacing is beginning to fail. Industry standard is to resurface sports courts every 5‐7 years, depending on use, climate, etc. The estimated cost is $27,000. Plains Park ‐ Brown and Memorial Field Repairs: This request is to regrade, and repair sections of each field located at Plains Park. Much of the work will be performed at Brown 2 Fields infield with additional work performed at Memorial Field. Both fields are used by the American Little League and are also used for the Stan Brown invitational tournament as well as the Williamsport tournament. At Brown Field, edge lips will be stripped and regraded. Infield mix will be laser graded, once proper grade is established sod will be installed. This will be done to eliminate existing tripping hazards. This will also reduce the risk of a baseballs skipping and causing injury. Work performed at Memorial Field will be to regrade the infield mix, incorporate new material and remove any major infield lips on the outer arc of the playing surface. The cost of this project is $20,000. Rail Trail Maintenance & Surfacing: Consistent with prior annual appropriations, this request ($8,000) is for the ongoing maintenance and resurfacing of the Danvers Rail Trail. Water Bubblers: Part of a multi‐year replacement program, this project proposes to replace the water bubblers at the Great Oak and Plains Park Playgrounds at a cost of $8,000 (WUMP).

Each year, Town Meeting appropriates varying sums, to be used with State grant funds, to finance the Pavement Management Program, which includes work on all existing Town and school roadways, sidewalks, curbing, and parking areas. State funding has been level for many years, and in addition to routine repair work, Town funding has been necessary to keep all municipal areas in good condition, such as Town parking lots. Unfortunately, we have also seen a decrease in the life expectancy of road pavement due to environmental regulations requiring the use of more recycled products and changes to the binding oils. Overall, this has resulted in a backlog of areas needing improvement greater than $1 million. This capital request is necessary to fund repairs to sidewalks, patching of small sections of roads, curbing re‐pairs, and the annual crack sealing program. In addition to the funding necessary for these anticipated road and sidewalk repairs, $25,000 is also recommended for Engineering consulting services relating to ADA compliance and construction activities

This request is to support the ongoing investment in the town‐wide technology program. By a single appropriation, we minimize duplication of technology efforts and costs between Library, General Government, and Schools. The Town’s responsibility for IT infrastructure is maintained and updated through this article, as are departmental, non‐recurring expenses for hardware and software added to the IT network. Routine, annual operational costs are included in the Information Technology or School Department budgets.

Program Area Pavement Management & Sidewalk Improvements




Program Area Technology Plan




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The School request for $100,000 includes: desktop replacements ($14,000); switching infrastructure ($30,000); a High School auditorium projector replacement ($16,936) and interactive educational display panels to replace outdated smartboards ($39,064)

The Library’s IT services are provided primarily through its membership in NOBLE, the (North of Boston Library Exchange). The Town supports those items not covered. The total request of $13,000 includes the purchase of laptops and tablets ($1,000); software licensing ($5,000); replacement of desktop computers and printers in accordance with a regular replacement cycle ($5,000); and miscellaneous technical supplies ($2,000).

The General Government request of $137,000 includes: phone system replacement at the Senior Center ($30,000); social media archiving services ($5,000); server maintenance and upgrades ($50,000); and Office 365 productivity suite, which has an annual licensing cost of ($52,000).

This request is for the purchase and installation of hardware and software to replace the aging school phone system. Portions of the existing system will no longer be supported beyond October 2021:

In 1999, the Town completed a natural shoreline stabilization project along the Crane River at John L. George Park, utilizing coir rolls, grading the eroded shoreline, and installing saltwater plantings. This stabilization effort ultimately failed to prevent the continued erosion and scouring of the shoreline due to the velocity of the tidal currents. A secondary attempt using the same vegetative slope stabilization was performed several years later and did not provide any greater results or outcomes for maintaining the existing shoreline.

The preferred alternative for restoration and stabilization of the coastal bank requires integrated hardscape and vegetative combinations. This hybrid approach will aid in reducing the scour velocities of the Crane River, stabilizing the eroding shoreline, and protecting the existing South Essex Sewer Interceptor that travels through park to the Doty Avenue Pump Station. The Town voted to appropriate $65,300 at the May 2018 Annual Town Meeting to begin the permitting and conceptual design process for filing the Environmental Notification Form (ENF) to the Executive Office of Energy and Environmental Affairs (EEA). The ENF commences the conceptual design review for the Environmental Protection Agency (EPA), Army Corp of Engineers, Coastal Zone Management (CZM), and the Massachusetts Department of Environmental Protection (MassDEP). A portion of the funding was also being utilized to extend the existing permits to reconstruct the existing dock and gangway to comply with the updated Americans with Disabilities Act (ADA).

Program Area General Fund Capital Projects

Project Title School Phone System Replacement



Program Area General Fund Capital Projects

Project Title John L. George Park Gangway Improvements & Bank Stabilization



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The proposed work must start with stabilization of the shoreline, which requires separate permitting approval from different environmental agencies. The stabilization concept is an eligible project based on the criteria under the Municipal Vulnerability Preparedness Program (MVP). The grant application submission would focus on incorporating CZM’s StormSmart™ properties that utilize bioengineered coir rolls on costal banks for restoring coastal shoreline that abuts the existing docks.

The Town’s consultants have estimated a total cost of submitting the grant application and providing the analysis to finalize a design estimate of $100,000 to complete the shoreline improvements. The MVP grant will aid in funding the analysis and confirming the methodology described for the application of shoreline stabilization along the Crane River. The recommendation is for the Town to appropriate $25,000 for the shoreline restoration along the Crane River at John L. George Park to match the twenty five percent (25%) grant contribution required by the MVP grant.

The routine replacement of vehicles is critical to Town operations. By following a replacement schedule, the Town avoids the added costs associated with extraordinary maintenance as well as vehicles being out of service. The vehicles requested this year include $366,000 for DPW/Water/Sewer vehicles including a 6‐wheel dump with plow; $214,985 to replace 4 Police cruisers; $55,000 for a Fire prevention vehicle; $46,000 for a Recreation tractor; and $65,000 for two School passenger vans.

Like vehicles, certain departmental equipment must be replaced on a semi‐regular basis. These expenses are not annual and can be expensive to fit within the operating budget. This year equipment needs include $123,750 for Fire portable radios, $40,000 for Police body armor; $81,000 for various DPW equipment; and $42,000 for a mobile column lift. The total cost of the lift is being split equally between the General Fund, Sewer, and Water.

Program Area Capital Outlay

Project Title Vehicles


Funding Source Free Cash ‐ $658,985; Sewer ‐ $50,000; Water ‐ $38,000

Program Area Capital Outlay

Project Title Equipment


Funding Source Free Cash ‐ $258,750; Sewer ‐ $14,000; Water ‐ $14,000

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In January 2007, the Town of Danvers commissioned a Storm Water Capital Improvements Plan, identifying capital improvements and capital maintenance projects within the Town’s three major drainage basins. The report included an inventory and evaluation of all the existing drainage outfalls, stream banks, and road culvert crossings in need of repair and replacement. The report summarized the evaluations and prepared a 10‐year Capital Improvements Plan.

The Frost Fish Brook Cleaning and Bank Stabilization project was originally scheduled as a two‐phase project. Phase I of the project was completed in FY2018 and was delineated from the culvert at Massachusetts Avenue (near Coolidge), continuing downstream to the culvert at Poplar and Conant. Phase II, just completed in FY2021, was only continued from the culvert at Coolidge and Massachusetts Avenue to the inlet of the Cabot Road culverts in front of Danvers High School. Phase III of the project was unable to be constructed due to escalated construction costs. Phase III will continue from the culvert headwall at Cabot Road (near Danvers High School) and end at the culvert located on Dartmouth Street, and continue north towards Burley Street. The project will clear and remove moderate to heavy stream bank and stream bed vegetation, organic debris deposits and trash, cut and remove trees located at the edge of the bank, over the stream, and in the stream. In addition, it will remediate bank erosion and failed slopes by installing rip‐rap along each slope where needed.

At the June 2020 Annual Town Meeting, funds were appropriated for the purpose of continuing the Systematic Flushing, Cleaning and CCTV Inspection of the Town’s Wastewater Collection System. The Flushing and CCTV Program identifies areas for Spot Repairs and CIPP Lining of Sewers. The latest project was recently bid in February 2021, and work will be completed after the Winter 2020‐2021 Moratorium. Since the Town bids the work during the “off season,” the companies that specialize in this type of work are providing the Town with very advantageous bid prices, which allows for larger areas of the Town to be flushed, cleaned, and CCTV inspected.

For Fiscal Year 2022, the proposal is to continue flushing and inspecting sewers outside of our existing comprehensive sewer rehabilitation areas, located in the northeastern sections of Town. The Town is required to continue the Systematic Flushing, Cleaning, and CCTV Inspection and inventory of Collection System Sewers annually based on the current MassDEP 314 CMR 12.04 regulation to operate and maintain a Wastewater Collection System. Based on the most recent bid prices, along with design, plans, and specification estimates, and limited construction services, the estimated cost of this work is $200,000.

Program Area Sewer Enterprise Fund

Project Title Frost Fish Brook Cleaning & Bank Stabilization


Funding Source Sewer Retained Earnings


Project Title Flushing & Cleaning Sewer Lines & CCTV Inspections



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Annual maintenance work is required ensure the proper operation of the Town’s drainage system. This includes routine work such as brush clearing along the stream embankments, removal of debris, rip rap, pipe repairs and other related work. In the recent years, this article has funded several larger drainage related projects, including 91‐93 Burley Street and Elliot Street at Conant Street. In fiscal year 2022, improvements at multiple catch basin locations have been identified, including Barker and Williams Streets, in addition to normal maintenance work.

The Town utilizes two (2) main interconnection vaults: with the City of Beverly on Conant Street and the City of Peabody on Water Street. The interconnections are a vital back‐up to our distribution and treatment system, when emergency or planned repairs take the treatment plant out of service. The twenty‐year capital plan and the finalized Emergency Action Plan (EAP) acknowledge these two interconnections as supplementary feeds and require immediate upgrades and planned maintenance in preparation for periods of future droughts, contaminant issues, or large‐scale mechanical failures within our public water supply. The conditions and locations of the interconnection vaults have also exceedingly seen water intrusion through the existing access covers, which has led to internal flooding and mechanical failures. The above‐mentioned water intrusion, coupled with the aging infrastructure, has accelerated the need to take immediate action to upgrade the interconnections.

As part of the preliminary study, a cost estimate of $412,000 for further evaluation and necessary improvements has been generated by consultants and the Engineering Division. The capital improvements will involve the following: a comprehensive assessment of existing structural, mechanical, and electrical control systems at the Water Street interconnection, demolition of existing equipment, upgrade of valves and piping, upgrade of the SCADA system, replacement of the entry hatch, installation of additional pipe supports, new controls, new flow meters, and installation of a new power source for the electrical system at the Conant Street interconnection.

Located outside of the Danvers State Hospital Covered Storage Reservoir is a semi‐automatic control “valve” that opens when water is pumped into the reservoir, closes when the reservoir is full to prevent overflows, and re‐opens when demand in the system requires additional water. The original installation of the valve


Project Title Drainage Maintenance



Program Area Water Enterprise Fund

Project Title Emergency Water Interconnections


Funding Source Water Retained Earnings


Project Title State Hospital Reservoir Valve Replacement & Vault Rehabilitation



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dates back to the 1960s or 1970s, and the manufacturer is no longer in business. In addition, the valve only operates based on preset pressure conditions. The valve must be operated manually (on site) in order to allow the water in the tank to balance the turnover of the system hydraulics between the Water Treatment Plant and our Water Storage Reservoirs.

As part of the 2013 technical review of the 2006 Capital Improvements Plan for the Water Distribution System, it was recommended to replace the valve and remove and replace the existing valve vault, a SCADA connection to operate the valve remotely and a water sample tap. An appropriation was approved in the May 2014 ATM to begin the design of the replacement and rehabilitation project. The preliminary design is completed and based on the engineers’ estimate, the Town is seeking additional funding to finalize utility easements and construct the new valve and vault.

The updated 2018 twenty‐year Capital Improvement Program evaluation study listed the Lakeview Booster station as a priority replacement due to its poor condition and age. The booster station was installed in 1993 and is approaching 28 years in service, with only minimal enhancements made to the overall pumping system during its lifespan. The condition and location of the station has exceedingly seen water intrusion through the existing hatch and has also seen internal flooding due to controller and mechanical failures.

As part of the study, a preliminary cost estimate of $150,000 for a final recommendation and design necessary for improvements has been generated by Engineering and our consultants. The evaluation will provide a realistic determination whether or not the existing booster station should be entirely demolished and rebuilt or retrofitted by only demolishing and replacing the existing equipment inside, including the existing jockey and high flow pump system, the SCADA system, entry hatch, and electrical system. A cost estimate of the work is included with this request.


Project Title Lakeview Booster Station



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Program / Project FY2022 FY2023 FY2024 FY2025 FY2026Building Improvements 185,000$ 185,000$ 300,000$ 307,500$ 315,188$

Grounds Improvements 90,500$ 90,500$ 140,000$ 143,500$ 147,088$

Pavement and Sidewalk Management 248,000$ 248,000$ 350,000$ 358,750$ 367,719$

Technology Plan 250,000$ 250,000$ 350,000$ 358,750$ 367,719$

General Fund Capital Projects 175,000$ 4,118,000$ 26,150,000$ 1,618,000$ 1,100,000$

School Phone System Replacement 150,000$

John L. George Park Gangway Improvements & Bank Stabilization 25,000$ 1,100,000$

Riverside Roof 3,000,000$

Roadway Layout and Acceptance of Public Ways 18,000$ 18,000$

DPW Facility 25,000,000$

Syzpko Bridge Maintenance & Repairs 900,000$

Rail Trail (Transportation Improv Proj.‐TIP) 250,000$

Maple Street Crossing Rail Trail 900,000$

Donegal Bridge 700,000$

Tapley Bridge 700,000$

Route 128 and Route 1 Rail Trail Crossing 400,000$

Capital Outlay Vehicles 658,985$ 583,956$ 350,165$ 483,956$ 345,165$

Police Vehicles (4) 214,985$ 268,956$ 215,165$ 268,956$ 215,165$

36K GVW 6‐Wheel Dump w/Plow 188,000$

School Passenger Van (2) 65,000$

Fire Prevention Vehicle 55,000$

Tractor 46,000$

3/4 Ton DBL Cab Pick‐up w/Plow 45,000$

3/4 Ton Pick‐up w/Plow & Lift Gate 45,000$

Car 1 Chief’s Vehicle 70,000$

Grounds #93 45,000$

3/4 Ton DBL Cab Pick‐up 45,000$

3/4 Ton Pick‐up w/Plow 45,000$

Grounds #106 40,000$

Buildings #80 35,000$

Grounds #97 35,000$

Grounds #100 55,000$


#77 Admin Vehicle 35,000$

Car 2 Deputy Chief’s Vehicle 75,000$


Grounds #91 40,000$

Admin #78 35,000$


Grounds #108 45,000$


Capital Outlay Equipment 258,750$ 182,499$ 150,000$ 35,000$ 65,000$

Fire Portable Radios (18) 123,750$

Police Body Armor 40,000$

Mower w/ Rough Mower Attachment 27,000$

Mower (2) 24,000$

Mower 48" w/ Hopper Gas Engine 20,000$

Message Board 14,000$

22' Trailer (for sidewalk paver and equipment) 10,000$

Patrol Car Laptops 40,500$

33 HP utility tractor w attachments 35,000$

4x4 Tractor 35,000$

Mower 35,000$

BT Machine 13,000$

Mobile Radar Units 10,000$ 10,000$

Taser Replacements 7,700$

Slice Seeder Walk Behind 6,299$

2014 Tractor 85,000$

Turnout Gear 55,000$

2017 Field Mower 35,000$

2015 Leaf Vacuum 45,000$

Live Scan Fingerprint Technology 20,000$

Grand Total ‐ General Fund 1,866,235$ 5,657,955$ 27,790,165$ 3,305,456$ 2,707,878$

CAPITAL IMPROVEMENT PLAN ‐ 5‐YEAR

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Program / Project FY2022 FY2023 FY2024 FY2025 FY2026Enterprise Funds

Sewer Enterprise Fund 694,000$ 1,082,500$ 2,425,000$ 7,075,000$ 6,475,000$

Frost Fish Brook Cleaning & Bank Stabilization (Airport Branch) 405,000$ 1,200,000$

Flushing & Cleaning Sewer Lines & CCTV Inspections 200,000$ 200,000$ 200,000$ 200,000$ 200,000$

Drainage Maintenance 25,000$ 25,000$ 25,000$ 25,000$ 25,000$

Adams Street Culvert 807,500$

Wastewater Collection System Improvements 5YR CIP 700,000$ 700,000$ 700,000$

Beaver Brook Cleaning 2,000,000$

Szypko Bridge Replacement 2,000,000$

Frost Fish Brook Cherry Hill Branch 1,150,000$

Coolidge Road Culvert 1,000,000$

Purchase Street Culvert 2,500,000$

Crane Brook Phase I‐III 2,000,000$

Fowler Brook Cleaning 850,000$

Sewer Submersible Pump Replacement 200,000$

Capital Outlay 64,000$ 50,000$ 300,000$

Water Enterprise Fund 959,000$ 3,665,000$ 2,960,000$ 2,275,000$ 2,570,000$

Emergency Water Interconnections 412,000$

State Hospital Reservoir Valve Replacement & Vault Rehabilitation 345,000$

Lakeview Booster Station 150,000$

Lakeview Avenue Booster Construction 1,440,000$

Well 2 PFAS Treatment 1,000,000$

Redevelopment of Well 1 /North Well 900,000$

Water Transmission/Distribution Mains 2,000,000$ 2,000,000$ 2,500,000$

Emerson Brook Dam Rehabilitation 800,000$

Capital Outlay 52,000$ 325,000$ 160,000$ 275,000$ 70,000$

Grant Total ‐ Enterprise 1,653,000$ 4,747,500$ 5,385,000$ 9,350,000$ 9,045,000$

Capital Improvement Plan Total 3,519,235$ 10,405,455$ 33,175,165$ 12,655,456$ 11,752,878$

CAPITAL IMPROVEMENT PLAN ‐ 5‐YEAR

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Funding Source FY2021 FY2022 FY2023 FY2024 FY2025

Borrowing ‐$ 3,000,000$ 25,000,000$ ‐$ ‐$

General Fund Capital Projects 3,000,000$ 25,000,000$

Free Cash 1,858,235$ 2,657,955$ 2,790,165$ 3,305,456$ 2,707,878$

Building Improvements 185,000$ 185,000$ 300,000$ 307,500$ 315,188$

Grounds Improvements 82,500$ 90,500$ 140,000$ 143,500$ 147,088$

Pavement and Sidewalk Management 248,000$ 248,000$ 350,000$ 358,750$ 367,719$

Technology Plan 250,000$ 250,000$ 350,000$ 358,750$ 367,719$

Capital Outlay Vehicles 658,985$ 583,956$ 350,165$ 483,956$ 345,165$

Capital Outlay Equipment 258,750$ 182,499$ 150,000$ 35,000$ 65,000$

General Fund Capital Projects 175,000$ 1,118,000$ 1,150,000$ 1,618,000$ 1,100,000$

WUMP 8,000$


Sewer Funds 694,000$ 1,082,500$ 2,425,000$ 7,075,000$ 6,475,000$

Retained Earnings (or Borrowing) 630,000$ 1,032,500$ 2,125,000$ 7,075,000$ 6,475,000$

Operating 64,000$ 50,000$ 300,000$

Water Funds 959,000$ 3,665,000$ 2,960,000$ 2,275,000$ 2,570,000$

Retained Earnings (or Borrowing) 907,000$ 3,340,000$ 2,800,000$ 2,000,000$ 2,500,000$

Operating 52,000$ 325,000$ 160,000$ 275,000$ 70,000$

Total 3,519,235$ 10,405,455$ 33,175,165$ 12,655,456$ 11,752,878$

CAPITAL IMPROVEMENT PLAN ‐ 5‐YEAR FUNDING PLAN

105

Town of Danvers

Capital Improvement Plan Policy

Date Authored: March 1, 2020

Introduction

The purpose of this document is to establish policies defining the capital improvement plan.

Background: Planning for and financing the replacement, repair, and acquisition of capital assets is a critical component of any municipality's budget and operations. Prudent planning and funding of capital assets ensures that a municipality can provide quality public services in a financially sustainable manner. A balance must be maintained between operating and capital budgets, so as to meet the needs of both to the maximum extent possible. The development of a Capital Improvement Program (CIP) is the mechanism that a municipality uses to identify projects, prioritize funding, and create a long‐term financing plan that can be achieved within the limitations of the budget environment. Long‐term capital planning is another one of the important local government financial practices that credit rating agencies evaluate when assessing municipalities for credit worthiness.

Capital Improvement Plan Process:

The Finance Director will prepare forms and instructions and coordinate development of the capital improvementbudget in coordination with Public Works and other departments as needed. All departments will be invited tosubmit requests and participate in the decision‐making process.

Capital projects should be prioritized based upon criteria established by the Town Manager.

Available funding and debt capacity should be identified early in the process to ensure all stakeholders are awareof the resources available as they prepare project requests.

Future operating costs associated with new capital improvements will be projected and included in operatingbudget forecasts, as appropriate.

Federal, state, or private grants should be used to finance only those capital improvements that are consistentwith the Town's capital improvement plan and priorities, and for which operation and maintenance costs havebeen included in budget forecasts.

The Town should maintain all assets at a level that is sufficient to protect the Town' s capital investment, and tominimize future maintenance and replacement costs.

The Town should identify ongoing maintenance needs, preventative maintenance activities, and replacementschedules on an annual basis.

The Town should project all capital needs for the next five years when developing this CIP. Once established, theprojection should be updated each year.

The estimated costs and potential funding sources for each proposed capital project should be identified beforeit is submitted to Board of Selectmen and the Finance Committee for Town Meeting appropriation.

Capital Project/Item: An expenditure of $5,000 or more with a useful life greater than one year for one of

the following purposes:

Acquisition of land Construction, expansion, or renovation of a facility or infrastructure including buildings, streets,

bridges, sidewalks, parking lots, utilities, playing fields, open space, playgrounds, etc. Acquisition of large capital items including vehicles, technology, communication equipment, etc. Facility maintenance projects including roof repair, HVAC, electrical, masonry, painting, carpeting,

street resurfacing, sidewalk reconstruction, playground equipment/major repairs, etc. Planning, feasibility, engineering, or design studies related to a capital project.

106

Prioritization Criteria:

1 – Projects essential to health/safety of the public, and/or employees; projects essential to protecting property;

projects that leverage a significant outside funding source.

2 – Projects without which an existing or critically needed service cannot be provided with quality or

dependability.

3 – Projects that produce a cost savings to the Town; projects that are responsive to the desires of a significant

segment of the community.

Funding Sources:

Borrowing: Projects/items of $25,000 or more with a useful life of at least 10 years may beconsidered for borrowing. The term should be for no longer than the useful life of the asset,however efforts should be made to target a shorter, equal principle model to minimize interestcosts. All projects recommended for borrowing must fit within the Town’s long‐term debt plan aswell as be vetted through the Town’s financial advisors and bond counsel. The sources of revenueto support borrowing are:o General Fundo Enterprise Fund Debt Service Budget (Water/Sewer/Electric)

Capital Outlay: Projects/items of $5,000 or more with a useful life of at least one year may beconsidered for capital outlay funding. This includes all vehicle replacement other than heavierpieces of equipment that may require borrowing or a separate warrant article. The sources ofCapital Outlay funds are:o General Fund (Tax‐supported or via Free Cash)o Enterprise Fund Operating Budget (Water/Sewer/Electric)

Warrant Articles – Projects/items of $5,000 or more with a useful life of at least one year maybe considered for funding in a Town Warrant Article. The sources of revenue to support warrantarticles are:o General Fund (Tax‐supported or via Free Cash)o Enterprise Fund Retained Earnings or Operating Budget (Water/Sewer/Electric)o Federal, State, and Private grant opportunities

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SUPPLEMENTAL INFORMATION

COMMUNITY PROFILE The Town of Danvers is located on Massachusetts' northeastern coast,

approximately 20 miles from Boston, in Essex County. The Town is perhaps best

known for its connection to the Salem Witch Trials, which occurred in 1692 when

the Town was still part of that community. Rebecca Nurse's home, one of the

hysteria's victims, still stands today and serves as a museum dedicated to

depicting 17th and 18th‐century life.

Danvers was established in 1752, although it was not formally incorporated by

the colony's legislature until June 9, 1757, despite the denial of King George II.

This royal rejection led to the Town's motto, "The King Unwilling."

Today Danvers is a thriving community of approximately 28,000 residents, spread over 14 square miles,

with a strong commercial and industrial employment base. Its attractiveness to both residents and

businesses is rooted in its easy access to the region – Interstate 95, US Route 1, and State Route 128, all

pass through and intersect in Danvers. Because of this, Danvers is a commercial hub for the entire

North Shore.

The Town's legislative functions (principally adopting budgets and by‐laws) are handled by an elected,

representative Town Meeting, while the Select Board and Town Manager lead the executive branch.

Other critical local boards include the School Committee, The Library Trustees, the Planning Board, the

Water‐Sewer Commission, and the Municipal Light Board. Except for the Select Board and the School

Board, which are elected, these are appointed positions filled by citizen volunteers.

Population and Income According to the US Census Bureau's American Community Survey, Danvers' total population has

increased at less than one percent per year since 2010 and is approximately 28,000. Consistent with

national trends, the community's median age is creeping up and is presently at 45 years of age.

Household size has been steady over the last four decades, right around 2.5 individuals per dwelling

unit.

While the population has remained stable, median household income has increased and is currently

over $89,250. This metric had been flat between 1980 and 2010 but has since been rising. Interestingly,

per capita income has been holding steady at around $47,000 over this same period. This is affected by

the increasing number of residents under 18 and over 64, who tend to have lower personal incomes

than working individuals.

108

Total Population 27,586 Less than 9th grade 1.4%

Female 14,989 9th‐12th grade, no diploma 3.7%

Male 12,597 High school graduate 20.8%

Median Age 45 GED/Alternative credential 1.9%

Some college 15.8%

Associate degree 11.0%

Owner‐occupied units 7,626 Bachelor's degree 27.2%

Renter‐occupied units 3,063 Graduate/Professional degree 18.2%

Median home value 427,400$

Median mortgage payment 2,421$

Median monthly rent 1,398$ Ag/Mining 1.0%

Vacancy rate 3.9% Construction 3.3%

Finance/Insurance/Real estate 6.7%

Information 9.7%

Median household income 89,250$ Manufacturing 6.4%

Mean household income 110,199$ Public administration 7.1%

Per capita income 45,650$ Retail trade 21.0%

Services (Health Care; Food Services, etc.) 54.1%

Transportation/Utilities 2.1%

<$15,000 8.5% Wholesale trade 2.9%

$15K‐$24,999 4.1%

$25‐$34,999 9.0%

$35K‐$49,999 10.4% Drove alone 84.2%

$50K‐$74,999 12.2% Public transportation 2.8%

$75K‐$99,999 12.6% Walked, Biked or other means 3.4%

$100K‐$149,999 18.6% Carpooled 6.8%

$150K‐$199,999 12.3% Worked from home 3.8%

$200k+ 14.7% Mean travel time to work (mins) 28.7

Source: 2019 American Community Survey 5‐year estimates

Commuting Share

Population

Housing

Average Income

Household Income

Education

Population by Industry

109

Town of Danvers Organizational Chart

Voters

Library Trustees

Library Director

Select Board

Town Accountant

Town Manager

Finance Director

Accounting

Assessing

Purchasing

Retirement

Treasurer/ Collector

Information Technology

Assistant Town Manager

Communications

Human Resources

Town Clerk

Land Use and Community Services

Planning and Econ.

Development

Health

Natural Resources

Recreation

Senior and Social Services

Veterans' Services

Inspectional Services

Public Safety

Fire

Police

Public Works

Buildings

Business

Electric

Civil Engineering

Equipment

Forestry & Grounds

Streets

Water & Sewer

Town Moderator Town Meeting School

Committee

School Superintendent

110

General Government FY20 FY21 FY22

Management 2.00 2.00 2.00

Information Technology 4.00 5.00 5.00

Department Heads 10.00 9.00 8.00

Accounting 5.00 5.00 5.00

Assessing 4.00 4.00 4.00

Treasurer/Collector 4.00 4.00 4.00

Human Resources 1.87 3.00 3.00

Town Clerk 4.00 4.00 4.00

Retirement System 1.50 1.57 1.57

Gen. Govt Subtotal 36.37 37.57 36.57

Public Safety FY20 FY21 FY22

Police Department 58.50 58.50 58.50

Fire Department 48.87 48.94 48.94

Public Safety Subtotal 107.37 107.44 107.44

Land Use & Community Services FY20 FY21 FY22

Inspectional Services 6.08 6.56 5.77

Public Health 3.55 3.55 3.55

Planning & Economic Development 4.67 4.67 5.71

Senior & Social Services 5.23 5.23 5.23

Veterans' Services 1.40 2.40 2.40

Recreation (Tax Supported) 7.00 7.00 7.00

Land Use & Community Services 27.93 29.41 29.66

Public Works (Tax Supported) FY20 FY21 FY22

Engineering 4.00 4.00 4.00

Street 15.00 15.00 15.00

Equipment 6.00 6.00 6.00

Buildings 26.70 26.70 26.70

Grounds & Forestry 10.00 10.00 10.00

Public Works Administration 3.00 3.00 3.00

Public Works (Tax) Subtotal 64.70 64.70 64.70

Committee Determined FY20 FY21 FY22

Education 458.90 458.15 459.15

Library 13.50 13.50 13.50

Committee Subtotal 472.40 471.65 472.65

Tax Supported Total 708.77 710.77 711.02

Non‐Education Tax Supported 249.87 252.62 251.87

Rate Supported FY20 FY21 FY22

Sewer 3.00 4.00 4.00

Water 22.00 22.00 22.00

Electric/Business Divisions 48.50 49.50 50.50

Rate Supported Total 73.50 75.50 76.50

FULL TIME EMPLOYEES BY DEPARTMENT

For further detail, see individual department pages.

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PERFORMANCE MEASUREMENT Overview FY2022 marks the second year in which the Town is highlighting performance metrics from our various departments. Performance measurement is used in both the public and private sector through collecting and analyzing data on daily operations, strategic goals, and other aspects of an organization. The purpose is two‐fold. First, it provides critical information to guide the decision‐making process as well as to guide long‐term planning. Second, it allows organizations to show the efficiency and effectiveness of the services they provide in a quantifiable and transparent way. There is a wide array of performance metrics tracked by local governments, some better than others and none that are perfect. By beginning the process of collecting and looking at some of this data, however, the Town can both provide information to citizens while using it as part of the overall decision‐making process. This year, each department was tasked to either provide a metric that they may already track and utilize or create and track a new metric. Depending on the department, some may lean more towards workload indicators than true performance metrics. Each of these metrics, though, tells at least part of the story of the efficient and effective services offered to the citizens of Danvers. The section is laid out so that each department’s metric is shown as a graph of some type with data labels detailing the raw numbers. A few sentences describing the metric are also included to provide context. Below is a sample:

200 200

300

400

0

50

100

150

200

250

300

350

400

450

FY2019 Actual FY2020 Actual FY2021 YTD FY2022 Target/Estimate

Sample Metric Name

This is a sample metric showing the formatting found throughout the remainder of this section.

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PERFORMANCE MEASUREMENT

The number of tickets closed helps us track the amount of support we provide annually to Town and School departments. It is an important indicator of both our preventative maintenance and the volume of requests that come in from users on a daily basis. This indicator helps us prepare for the coming year and manage our staffing and time dedication to certain types of support as we move along.

3,4633,306

1,077

3,400

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000


Information Technology ‐ Tickets Closed

188 205

149 149 149

‐

50

100

150

200

250

FY2019 Actual FY2020 Actual FY2021 Target/Estimate FY2022 Target/Estimate

Accounting ‐ Days until Schedule A Approval

Days until "Schedule A" Approved by DLS Target Days (11/30)

The Schedule A is a year‐end report of Town financial activity. It includes all revenues and expenditures by department and category, including operating expenses and salaries and wages. The report also includes special revenues, capital projects, enterprise, trust, and agency funds. The Town must present the debt schedule and all payments made, various personnel information, and all cash and fund equity balances. Reports must be completed and any variances or significant year‐over‐year change must be explained in order for the reports to approved by the State's Division of Local Services. This reporting is done after the completion of the audit and free cash certification. The State requests the report be provided by 11/30 each year and can penalize communities if the report is not filed within a certain timeframe.

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637

1,628

0

1,200

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

FY2019 Actual FY2020 YTD FY2021 Target/Estimate FY2022 Target/Estimate

Assessing ‐ Annual Cyclical Inspections

Municipalities in the Commonwealth are required to assess all real and personal property at "full and fair cash value." To achieve this, the Department of Revenue mandates that each municipality do a full data collection at each of its parcels at least once every ten years, referred to as "cyclical inspections." Due to the Town leveraging inspections during its major data review, the Assessor's Office was able to double the annual inspections traditionally completed in FY2020 and suspend the “cyclical inspection program” for one year (FY2021) thus saving taxpayer funds without falling behind schedule. FY2022 will return to the historical trend of inspections conducted.

15%

18% 18%

23%

0%

5%

10%

15%

20%

25%


Treasurer/Collector‐ % of Motor Vehicle Excise Bills Paid Online

The Treasurer/Collector's Office accepts online payments for a variety of bills, including motor vehicle excise. Paying online saves time for staff and the resident. The Town will continue to make efforts to promote online bill pay as well as improve its ease of use.

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As shown, the number of registered voters has increased significantly over FY2020. The increase is due to interest in the Presidential Election. The Town Clerk would not expect any significant increase in registered voters in the next fiscal year.

20,121 19,712

21,478 21,500

15,000

16,000

17,000

18,000

19,000

20,000

21,000

22,000

23,000

24,000

25,000


Town Clerk ‐ Registered Voters

1,290

720

68

1,500

0

200

400

600

800

1,000

1,200

1,400

1,600


Human Resources ‐ Employee Training Hours Offered

This performance metric captures the total number of training hours available to Town of Danvers employees. Offering various employee trainings is essential to help build an engaged culture, grow employees’ skills and capabilities, and ensure the Town has adequately trained staff. While employees may not attend all available training opportunities, having various options available is important. Training topics in this metric include mandatory trainings (ex. Harassment Training & Conflict of Interest) and voluntary trainings (ex. Communicating with Tact & Excel). Due to COVID‐19, planned trainings for FY2020 & FY2021 were delayed because they are typically conducted in‐person. With the increase in online and virtual training availability, we anticipate satisfying the metric for FY2022.

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2,645

3,045

2,256

3,300

0

500

1,000

1,500

2,000

2,500

3,000

3,500


Police ‐ Directed Patrols

Directed Patrols are officer‐initiated activity that entails an officer spending time in a location of interest within their patrol area. The patrol can be at a hot spot location for crime and disorder and utilized as a deterrent to such behaviors, or it can be at a place where the community gathers as a way to build rapport and increase positive interactions between officers and the community. The Department is committed to increasing proactive policing efforts.

85 81

2,862

2,363

3,796

3,276

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

FY2019 Actual FY2020 Actual

Fire ‐ Call Volume

Fire related calls Service calls Medical calls

The drop in incidents expected for FY2020 became a reality, due to a change in policy for responding to certain calls at facilities where there are qualified medical personnel on staff. Fire ended up with a reduction in overall runs for the year, largely due to the Covid‐19 pandemic.

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15

12

5

12

0

2

4

6

8

10

12

14

16


Public Works ‐ Road Miles Paved

Pavement Management Program inspects the roadways every other year which provides ratings for the pavement condition and provides a recommendation on repair treatments and prioritization. Chapter 90 pavement projects include a yearly average of 8–10 miles of roadway, construction of new sidewalks, handicap ramps, and roadway line painting. Also note in FY2020 1.5 miles of sidewalks have been reconstructed thus far.

79

65

22

75

0

10

20

30

40

50

60

70

80

90


Public Works ‐ Tree Planting Program

Danvers has approximately 40,000 town trees that are along roadways, parks, schools, municipal buildings, and forests. Danvers has received the Tree City USA award for 32 consecutive years. The program requires that the Town performs tree inspections, pruning, and a removal and planting program. With targets in place to plant approximately 75 tree each year, this will ensure this program will continue to be a success.

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1.064 1.088

0.567

1.100

0.000

0.200

0.400

0.600

0.800

1.000

1.200


Public Works ‐ Gallons of Water Treated (in billions)

On an annual basis, the Water Treatment Plant treats approximately 1.1 billion gallons of water and operates a state‐certified laboratory for water bacterial analysis while providing compliance with regulations associated with the Safe Drinking Water Act.

994 889 640 900

680696

432

700

516507

310

500

411356

262

400

0

500

1,000

1,500

2,000

2,500

3,000


Inspectional Services ‐ Total Permits

Building Permits Electrical Permits Plumbing Permits Gas Permits

These numbers are reflective of the health of the overall economy. With a strong economy, these permits remain steady year‐over‐year. These permits generate revenue for the Town, particularly in the category of building permits.

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This metric is designed to assess the financial impact of implementing zoning initiatives, like the Downtown Corridor proposal. While zoning changes are not undertaken simply for the benefit, real or perceived, of increases to property tax collections, they nevertheless play a part in what is allowable, or not, in a given land area. Part of the way to assess the success of a zone change, at least in a solely numbers fashion, would be to track values over time within geographies where Town Meeting has approved zoning changes. While it is still early to measure based on current data, this will be an interesting figure to watch in the coming years.

$139,113,700 $135,730,600

$‐

$20,000,000

$40,000,000

$60,000,000

$80,000,000

$100,000,000

$120,000,000

$140,000,000

$160,000,000

FY2019 Actual FY2020 Actual

Land Use & Community Services ‐ Zoning Implementation

8,902

7,668

2,251

9,347

‐

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000


Recreation ‐ Program Participants

In 2020, Danvers Recreation offered 411 Recreation Programs that serviced over 7,500 registered participants who participated in various recreation programs. The pandemic greatly impacted the program offerings and thus the participation numbers, along with reservations.

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FINANCIAL POLICIES Overview Financial policies are central to a strategic, long‐term approach to financial management. Some of the most powerful arguments in favor of adopting formal, written financial policies include their ability to help governments: institutionalize best practices; clarify strategic intent; define boundaries; support bond ratings; support long‐term thinking; and manage risks. The Town of Danvers was given its first ever AAA rating by Standard & Poor’s in 2019. One of the deciding factors was the implementation of several key financial policies. In 2016, Danvers adopted several policies encompassing a variety of areas of finance including: reserves, fund balances, debt, and enterprise funds. The Town has been in full compliance with all its policies each year since adoption and the Town’s AAA rating has been reaffirmed twice since 2019. In 2019, Danvers also adopted a Financial Policy Guideline document. The document was intended to establish a set of written financial management guidelines, and not the procedures that identify specific methods and actions necessary to carry out these policies. Topics included key financial areas such as budgeting, debt, and risk management. Policies and guidelines help direct the town in making prudent financial management decisions. They are structured with the flexibility necessary to address the complexities of municipal finance that often include unique, unexpected, or extraordinary circumstances. The following pages contain the financial polices adopted by the Town of Danvers in 2016. Additionally, the Town Manager’s budget transmittal letter earlier in this budget document showed the Town’s measurable compliance with these policies. The Financial Policy Guidelines are available on the Town’s website.

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Town of Danvers

Reserve Policy

Date Adopted: March 3, 2016

Date Revised: February 1, 2021

Introduction

The Town maintains reserves to stabilize its financial operations. These reserve funds may be utilized when necessary for

operational reasons and as a source of funds to address future liabilities.

Annual evaluations of immediate and future needs are conducted, in conjunction with studies performed by specialists,

like actuaries, in order to properly set appropriation levels to accommodate the balance that must be struck between

funding current operations and mitigating future liabilities.

Reserves shall be replenished as soon as practical to achieve the goals indicated below.

Free Cash

Free Cash is certified by the Massachusetts Department of Revenue’s Division of Local Services on an annual basis. Free

cash and the General Stabilization Fund (see below) are components of the unassigned fund balance (see Fund Balance

Policy). A Free Cash balance shall be maintained to provide the Town with financial flexibility and stability for the future.

The desirable remaining balance for Free Cash, after appropriation by Town Meeting, is no less than one percent

(1%) of the annual Operating Budget.

Example: If the Certified Free Cash at the time of Annual Town Meeting is $4 million, and the annual Operating Budget

being recommended to Town Meeting is $90 million, $3.1 million could be appropriated from Free Cash at Town Meetings

in that fiscal year, leaving 1% ($900,000) of the $90 million Operating Budget remaining in Free Cash after Town Meeting

appropriations.

Stabilization Funds

The Town maintains multiple stabilization funds:

Education Stabilization Fund – Created by special legislation, An Act Authorizing the Town of Danvers to Establish an

Educational Reserve Fund, the fund’s purpose is to provide a source for school related emergency and/or extraordinary

expenditures. This policy does not address the Education Stabilization Fund.

General Stabilization Fund – The Stabilization Fund may be utilized to protect against a reduction of service levels, to

manage a temporary revenue shortfall and unpredicted one‐time expenditures (balance as of 6/30/20: $3.1 million).

The General Stabilization Fund balance can be found in the Town’s “unassigned” General Fund balance.

Debt Stabilization Fund – Formerly named the School Construction Stabilization Fund, this fund is actively managed in

anticipation of large building projects, historically schools, which require borrowing (balance as of 6/30/20: $4.5 million).

The fund is used to mitigate the impact of debt service from these projects during peak debt years.

The desirable funding level for the Debt Stabilization Fund is fluid based on the timing of debt supported

projects. The Town’s goal is to allow for large building projects, approved by Town Meeting, to be financed

without an override of Proposition 2 1⁄2 (i.e. a debt exclusion).

The Debt Stabilization Fund balance can be found in the Town’s “committed” General Fund balance.

121

Other Post Employment Benefits (OPEB)

Other Post Employment Benefits Trust Fund – The Town has taken a layered approach to addressing the liability

associated with health and life insurance costs for current and future retirees:

From FY 2007 to FY 2016 the Town set aside an average of $266,525 per year into an OPEB Stabilization Fund

which was invested in an interest bearing money market account through MMDT.

The Town adopted MGL Chapter 32B, Section 18 which requires all eligible retirees to enroll in Medicare Part B.

This has allowed the Town to shift a significant portion of its retiree health care costs to the federal Medicare

program. The retiree sees no loss in benefits received.

The Town has engaged an actuarial firm every two years to evaluate its unfunded OPEB liability. The actuarial

values in the report are calculated consistent with Governmental Accounting Standards Board (GASB) Statement

No. 45.

The Town adopted MGL Chapter 32B, Section 20 which establishes an OPEB Trust Fund and transferred the

balance of the OPEB Stabilization Fund to the newly established Trust Fund. This allows the Town to invest under

the “prudent investor rule” in order to generate greater returns on investment.

The balance of the OPEB Trust Fund, as of 6/30/20, was $7.9 million.

Finance Committee Reserve

In accordance with M.G.L. Chapter 40, Section 6, at a Special or Annual Town Meeting the Town may transfer or

appropriate a sum of money not exceeding 5% of the prior year’s levy for extraordinary or unforeseen expenditures. By

a vote of the Finance Committee, money may be transferred from the fund to a General Government department. Most

transfers are requested when the extraordinary or unforeseen event occurs after the Annual Town Meeting or when no

Special Town Meeting is scheduled.

Example: In FY2018, the Operating Budget included $125,000 for the Finance Committee Reserve. After Annual Town

Meeting, the Town’s Employee Benefits budget ran into a shortfall of $120,028, or 1% of the total appropriation, due to

higher than anticipated enrollment. The Finance Committee voted on July 13, 2018 to transfer that amount to the

Employee Benefits budget to cover the shortfall. The remaining balance of the Finance Committee Reserve was returned

to the General Fund at the close of the fiscal year.

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Town of Danvers

Fund Balance Policy

Date Adopted: March 3, 2016 Date Revised: February 1, 2021

Fund Balance Policy

Fund balances are segregated to account for resources that are either not available for expenditure in the future or are

legally set aside for a specific future use.

The Town implemented GASB Statement No. 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type

Definitions, which enhances the usefulness of fund balance information by providing clearer fund balance classifications

that can be more consistently applied and by clarifying existing governmental fund type definitions.

The Town’s fund balance classification policies and procedures are as follows:

1. Nonspendable funds cannot be spent because they are either (a) not in spendable form, such as inventory or

prepaid items, or (b) legally or contractually required to be maintained intact, such as nonmajor governmental

fund reserves for the principal portion of permanent trust funds.

2. Restricted funds are used solely for the purpose in which the fund was established, and are restricted based on

the constraints imposed by creditors, grantors, contributors, or laws or regulations of other governments, or

constraints imposed by law through constitutional provisions or enabling legislation. This fund balance

classification includes General Fund encumbrances funded by bond issuances, various special revenue funds,

and the income portion of permanent trust funds.

3. Committed funds are established, modified, and rescinded as a result of articles passed by Town Meeting,

the highest decision‐making authority in the Town.

This fund balance classification includes: (a) General Fund encumbrances for non‐lapsing, special article

appropriations approved at Town Meeting, (b) stabilization and other reserve funds set aside by Town Meeting

vote for specific and non‐routine future capital acquisitions and improvements (reported as part of the General

Fund per GASB 54), and (c) various special revenue funds.

4. Assigned funds are used for specific purposes as established by management. These funds, which include

encumbrances, have been assigned for specific goods and services ordered but not yet paid for. This account

also includes fund balance (free cash) voted to be used in the subsequent fiscal year. The Town permits the

Town Manager to assign fund balance amounts to a specific purpose, although fund balance to be applied

against a subsequent year’s budget is voted by Town Meeting.

5. Unassigned funds are available to be spent in future periods. This is the amount of fund balance formerly

referred to as “unreserved, undesignated” fund balance. This classification is available to address emergencies

and provide fiscal stability. This is the classification governed by this Fund Balance Policy.

It is the goal of the Town to maintain the above Governmental Fund Balances, in the aggregate, above 15% of the

Town’s annual operating expenditures.

Order of Use of Fund Balances – When an expenditure is incurred that would qualify for payment from multiple fund

balance types, the Town uses the following order to liquidate liabilities: (1) restricted, (2) committed, (3) assigned, and

(4) unassigned.

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Considerations

Credit rating agencies, such as Moody’s and S&P, determine the adequacy of the unassigned fund balance using a

complex series of financial evaluations. The size of the fund balance is one of many important considerations in the

Town’s bond rating.

Other important factors are the reliability of the Town’s revenue sources, economic conditions, community wealth

factors, cash position, debt ratios, management performance, and fiscal decisions made by the legislative body.

Policy

It is the goal of the Town to achieve and maintain an unassigned General Fund balance in the range of 8‐12% of the

Town’s annual operating expenditures. The Town considers a balance of less than 5% to be cause for concern and will

work to restore the balance above that level as soon as possible.

Specifically, in the event the unassigned General Fund balance is calculated to be less than the policy anticipates, the

Town shall plan to adjust budget resources in the subsequent fiscal years to restore the balance.

Pursuant to Mass. General Laws related to establishing reserves, a portion of the unassigned General Fund balance may

be transferred to the Town’s General Stabilization Fund. Balances in the General Stabilization Fund are included in the

unassigned General Fund balance and are therefore included in the calculation of the Town’s 8‐12% goal.

The Town also maintains a Debt Stabilization Fund. This is a committed fund balance used specifically to offset the debt

service costs of school construction projects. For information on the Debt Stabilization Fund, see the Town of Danvers

Reserve Policy. Balances in Debt Stabilization Fund are not included in the calculation of the Town’s 8‐12% goal.

Reporting

The Director of Administration and Finance shall be responsible for monitoring and reporting the Town’s various fund

balances. The Town Manager is directed to make recommendations to the Select Board, the School Committee, the

Finance Committee and the Town Meeting on the use of unassigned funds both as an element of the annual

operating budget submission and from time to time throughout the year as needs may arise.

The Director of Administration and Finance shall annually submit a report to the Town Manager outlining the status

of the Town’s various components of the fund balance. This report shall be submitted within a reasonable period

after receipt of the annual financial audit. The Director of Administration and Finance shall also provide status reports

at other times to the Town Manager, Select Board, or Town Meeting as requested.

124

Town of Danvers

Debt Policy

Date Adopted: March 3, 2016 Date Revised: February 1, 2021

Introduction

The use of long‐term debt is an effective way to finance major infrastructure and equipment needs.

Properly managed debt can help maintain a solid credit rating, enhance flexibility in current and future

operating budgets, and provide the Town with long‐term assets that maintain or improve the quality of

life of Danvers residents.

Conversely, long‐term debt establishes a fixed obligation for many years, effecting not only current

residents, but also future residents. Accumulation of these fixed obligations can put a burden on the

Town’s ability to pay future operating costs or debt service. It is therefore vital that the Town put great

care into the planning and use of long‐term borrowing.

The purpose of this debt policy is to establish the guidelines governing the use of long‐term debt and to

demonstrate the Town of Danvers’ commitment to full and timely repayment of all debt issued.

In addition to the regulations set forth by Mass. General Laws, Chapter 44, the Town of Danvers will also

adhere to the following debt parameters when issuing and managing debt:

Debt will only be used to fund significant, capital projects and purchases of large capital assets

with a useful life of 5 years or more.

The Town will establish a goal of issuing debt for shorter periods than the maximum allowable

when the statutory limit is greater than 10 years.

The Town will continually pursue opportunities to acquire capital by means other than

conventional borrowing, such as grants or low/zero‐interest loans from state agencies, like the

Mass. Clean Water Trust and Mass. School Building Authority.

The Select Board will review, on an annual basis, the financial impact of proposed capital

improvements, both with and without Proposition 2 ½ debt exclusions.

The Town’s annual general fund debt service will not exceed 10% of the Town’s annual net

Operating Budget.

The Town’s goal in establishing these debt parameters is to meet or exceed the expectations of bond

rating agencies in order to maintain the Town’s AAA bond rating.

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Town of Danvers June 30, 2016 Water & Sewer Enterprise – Financial Policies Introduction: To ensure the financial stability of the Town of Danvers Water & Sewer Enterprise Funds, it is essential that financial policies be adopted and adhered to in the preparation and implementation of annual operations and capital budgets. Retained Earnings: Maintaining adequate reserves is a fundamental principle of sound financial management.

i. Water & Sewer Enterprise Fund Retained Earnings, as certified by the Massachusetts Department of Revenue, shall serve as the principal reserves for the Water & Sewer Enterprise Funds.

ii. The Water Enterprise Fund Retained Earnings balance should be at least 10% of the gross revenues of the Water Enterprise Fund after appropriation at Town Meeting.

iii. The Sewer Enterprise Fund Retained Earnings balance should be at least 10% of the gross revenues of the Sewer Enterprise Fund after appropriation at Town Meeting.

iv. Reserves can be used for any lawful purpose, but serve primarily to provide financial security in case of catastrophic and unforeseen events, or capital and asset renewal and replacement, or rate stabilization.

Capital: The Town shall provide consistent and stable funding sources for the timely and periodic renewal and/or replacement of water and sewer infrastructure, vehicles, and equipment.

i. For capital with a useful life of 10 years or under, the Town shall have a goal to finance said capital through retained earnings or rate revenue.

ii. For capital with a useful life of greater than 10 years, the Town shall consider borrowing per the regulations set forth under M.G.L. Chapter 44, Sections 7 & 8, when sufficient Retained Earnings are not available in accordance with the policy described above.

iii. Capital projects to be funded through the Enterprise Fund will be developed through an agreed to and reviewed 5‐year Capital Improvement Plan which will be updated each year.

Rate Structures

i. The Town will continue its existing practice of establishing water rates in order to promote conservation, cover operational costs, and provide f or capital improvements.

ii. Rates should be proposed and adopted in a manner sufficient to cover all Water and Sewer Division operational costs incurred during the fiscal year with the exception of catastrophic events.

Indirect Costs

i. Indirect costs shall be reviewed on an annual basis to ensure that they are reasonable in relation to the services being provided by the General Fund in support of Water & Sewer Operations.

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Summary:

Danvers, Massachusetts; GeneralObligation; Note

Primary Credit Analyst:

Victor M Medeiros, Boston + 1 (617) 530 8305; [email protected]

Secondary Contact:

Anthony Polanco, Boston + 1 (617) 530 8234; [email protected]

Table Of Contents

Rating Action

Stable Outlook

Credit Opinion

Related Research

127

Summary:

Danvers, Massachusetts; General Obligation; Note

Credit Profile

US$13.022 mil GO BANs ser 2021 dtd 02/15/2021 due 10/15/2021

Short Term Rating SP-1+ New

Danvers Twn GO

Long Term Rating AAA/Stable Affirmed

Danvers Twn GO

Long Term Rating AAA/Stable Affirmed

Rating Action

S&P Global Ratings assigned its 'SP-1+' short-term rating to Danvers, Mass.' approximately $13.0 million series 2021

general obligation (GO) bond anticipation notes (BANs) maturing on Oct. 15, 2021.

At the same time, S&P Global Ratings affirmed its 'AAA' long-term rating, with a stable outlook, on the town's existing

GO debt.

Danvers' full-faith-and-credit-GO pledge secures the bonds and notes. We note the town has both limited- and

unlimited-tax debt outstanding. Despite limitations imposed by the commonwealth levy limit law, we do not make a

rating distinction between the limited-tax GO pledge and Danvers' general creditworthiness, because the tax limitation

imposed on the town's ability to raise revenue is already embedded in our analysis of Danvers' financial and economic

conditions.

Officials intend to use the note proceeds toward the town's elementary school project, a high school roof replacement,

as well as wastewater facility improvements and a water distribution system.

Credit overview

The rating reflects our view of Danvers' consistently balanced financial results, which have led the town to maintain a

very strong reserve position over the past several years, and through various business and economic cycles, despite

long-term pressures from retirement benefits.

Danvers is operating in the pandemic with very strong budgetary flexibility, and well-embedded financial management

policies, particularly in the areas of budgeting and planning. Strong financial policies, combined with collaboration

throughout all government departments, provide a robust budgeting and planning framework, further supporting the

strong credit profile.

While we note significant uncertainty around certain revenue shortfalls and potential state-aid cuts that could weaken

the town's performance over the next few years, we understand that management has already taken measures to

cushion the effects of potential revenue shortfalls. Providing stability to the rating and the outlook are the town's very

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strong liquidity and stable revenue mix, with the predominant revenue stream of property taxes, with collections

upward of 99% during the fiscal year payable. However, given that there is still much uncertainty related to the

potential effects of COVID-19 on the town's finances, we will continue to monitor for any significant adverse effects

throughout the outlook period.

Long term, the town's retirement liabilities could increasingly pressure the operating budget, although we understand

officials are considering options to reduce the size of the liability and will likely begin meaningfully contributing toward

Danvers' other postemployment benefit (OPEB) trust fund with new revenues streams and once the pension system is

fully funded. Therefore, absent a substantial reversal of budgetary performance and flexibility or a deterioration in its

wealth and income conditions, we believe Danvers' credit quality will remain steady.

Danvers' GO bonds are eligible to be rated above the sovereign because we believe the town can maintain better

credit characteristics than the U.S. in a stress scenario. Under our criteria, "Ratings Above The Sovereign: Corporate

And Government Ratings—Methodology And Assumptions" (published Nov. 19, 2013), Danvers has a predominantly

locally derived revenue source, and we believe that pledged revenue supporting debt service on the bonds is at limited

risk of negative sovereign intervention.

The long-term rating further reflects our assessment of the following factors for the town:

• Very strong economy, with access to a broad and diverse metropolitan statistical area (MSA);

• Very strong management, with strong financial policies and practices under our Financial Management Assessment

(FMA) methodology;

• Adequate budgetary performance, with operating results that we expect could improve in the near term relative to

fiscal 2020, which closed with slight operating deficits in the general fund and at the total governmental fund level in

fiscal 2020 due to planned capital spending;

• Very strong budgetary flexibility, with an available fund balance in fiscal 2020 of 20% of operating expenditures;

• Very strong liquidity, with total government available cash at 36.5% of total governmental fund expenditures and

7.4x governmental debt service, and access to external liquidity we consider strong;

• Weak debt and contingent liability profile, with debt service carrying charges at 4.9% of expenditures and net direct

debt that is 74.7% of total governmental fund revenue, and a large pension and OPEB obligation and the lack of a

plan to sufficiently address the obligation, but low overall net debt at less than 3% of market value; and

• Strong institutional framework score.

Environmental, social, and governance factors

We evaluated the town's environmental, social, and governance (ESG) factors relative to its economy, financial

measures, management, and debt and long-term liability profile. We acknowledge that we consider the town's social

risks, absent the implications of COVID-19, as in line with those of the sector. Governance and environmental risks are

also in line with the sector. Danvers has strong financial management policies and practices, but larger unfunded

retirement obligations than its peers, which is a longer-term credit risk. The town recently received a municipal

vulnerability preparedness certification in 2020 and has updated its capital improvement programs to address potential

climate change concerns, particularly related to its enterprise utilities and water supply into the future.



Summary: Danvers, Massachusetts; General Obligation; Note

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Stable Outlook

Downside scenario

Should the town's pension and OPEB funded ratios materially weaken, without evidence the town is taking sufficient

steps to address the obligations and absorb rising costs, we could lower the rating.

Credit Opinion

Very strong economy

We consider Danvers' economy very strong. The town, with a population of 28,482, is in Essex County, 20 miles north

of Boston, in the Boston-Cambridge-Newton MSA, which we consider to be broad and diverse. It has a projected per

capita effective buying income of 132% of the national level and per capita market value of $191,657. Overall, market

value grew by 5.7% over the past year, to $5.5 billion in 2020.

A primarily residential community with a healthy commercial and industrial base, Danvers maintains a diverse

economy with sectors in retail, manufacturing, health care, high technology, and higher education. Approximately 76%

of the tax base is residential and 21% is commercial and industrial. Top employers include Medtronic Interventional

Vascular, a biomedical research and development company (955 employees); Hospice Care Dimensions (725); and

North Shore Community College (418). The top 10 taxpayers constitute 6.9% of assessed value, which we consider

very diverse.

Danvers is on Interstate 95 and Route 1, which provide easy access to employment centers in and around the town.

The regional economy is well-diversified and has been growing the past few years, but the pandemic has stymied its

momentum. The county unemployment rate was 2.3% in 2019, although it increased significantly because of the

stay-at-home orders peaking at 15.0% in June 2020. Unemployment declined to 6% in October 2020, although these

levels remain above-average compared with previous years. High unemployment for a prolonged period, particularly if

it exceeds 10% on an annualized basis, is a risk we are monitoring and one that might prove a headwind for

operations. IHS Markit forecasts Essex County's real gross county product (GCP) will fall by 3.25% in calendar 2020,

slightly better than the state's 3.8% decline. The forecast suggests that economic activity will not return to

pre-pandemic levels until early 2022, increasing 2.8% in 2021 and 3.0% in 2022. This is largely consistent with S&P

Global Economics' U.S. forecasts. (For more information on COVID-19's effect on the U.S. public finance sector, see

"Potholes On The Road To Recovery," published Sept. 29, 2020, on RatingsDirect, and "Staying Home For The

Holidays," published Dec. 2, 2020.)

Danvers adjusted its zoning bylaws to encourage additional mixed-use development. As a result of this rezoning, the

town has identified 1,000 units of potential development in the downtown area. As a result of these and other ongoing

development projects, we anticipate taxable market values will resume their growth as the local and national economy

improves.




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Very strong management

We view the town's management as very strong, with strong financial policies and practices under our FMA

methodology, indicating financial practices are strong, well-embedded, and likely sustainable.

In developing the budget, Danvers uses conservative assumptions grounded in a historical trend analysis and an

understanding of current economic conditions. It maintains strong practices in the areas of budgetary control, with

quarterly budget-to-actual reports and investment reports presented to the board of selectmen. The town also has a

rolling five-year, long-term financial plan that identifies budgetary pressures in outyears and prioritizes structural

balance. Complementing this plan is a five-year capital improvement plan that officials update annually and that

identifies funding sources for specified capital projects. Along with the debt policy, the town approved a fund balance

policy that targets an unassigned general fund balance of 8%-12% of its annual operating expenditures. If the

unassigned fund balance drops below 5%, the policy directs officials to restore the balance above that level as soon as

possible. The town has been in compliance with these policies since 2016. Danvers maintains a written investment

policy that mirrors state guidelines. Finally, in fiscal 2019, the board of selectmen adopted financial policy guidelines to

cover remaining policy areas, such as funding the OPEB trust fund.

Adequate budgetary performance

This assessment incorporates heightened near-term uncertainty due to the recessionary pressures related to the

COVID-19 pandemic and resulting financial pressures. The town had slight operating decline of negative 1.0% of

expenditures in the general fund and of negative 1.5% across all governmental funds in fiscal 2020. The decline in fund

balance was the result of a planned use of $1.5 million from its debt stabilization account toward costs associated with

the high school capital project. Our assessment accounts for our expectation that budgetary results could improve

from 2020 results in the near term, as management has taken prudent budgetary steps to control costs to account for

some revenue weakness. General fund operating results of the town have been stable over the last several years, with a

result of 0.4% in 2019 and a result of 0.4% in 2018 and 1.7% in 2017. In our assessment of budgetary performance, we

adjusted for recurring interfund transfers and one-time expenditures.

The 2021 budget totals $109 million, up a modest 1.9% over the previous year. Throughout the pandemic, Danvers has

implemented several cost-saving initiatives, with any savings becoming available to address any potential revenue

shortfalls. Overall, with the potential for level funding of state aid in fiscal 2021, we believe severe financial

deterioration is minimal in the current fiscal year. In the longer term, risks for budgetary performance remain, mostly

in the form of potential cuts to state aid, given the state's own revenue situation, and from rising fixed costs, especially

from pension and OPEB contributions. On the whole, property taxes constitute 76% of budgeted revenues and state

aid constitutes about 9.1% of budgeted revenues. Tax collections have historically been very strong and stable, with

the town typically receiving 99% on a current basis.

Very strong budgetary flexibility

Danvers's budgetary flexibility is very strong, in our view, with an available fund balance in fiscal 2020 of 20% of

operating expenditures, or $21.5 million. Management expressed a commitment to maintaining its fund balance level

in fiscal 2021, despite the uncertainty related to the pandemic. Calculation for available reserves includes assigned,

unassigned, and committed stabilization reserves. We expect our assessment of budgetary flexibility to remain at least

strong, if not very strong, based on the town's fund balance policy, which calls for the unassigned fund balance to




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remain at 8%-12% of expenditures and total fund balance in excess of 15%. The town generally exceeds its policy,

with total available fund balance maintained above 20% over the past five fiscal years, totaling 21% of expenditures in

2019 and 21% in 2018.

Very strong liquidity

In our opinion, Danvers's liquidity is very strong, with total government available cash at 36.5% of total governmental

fund expenditures and 7.4x governmental debt service in 2020. Given our expectations of stable operations and cash

flows, we do not expect any deterioration in the town's liquidity. The town has strong access to external liquidity,

demonstrated by its regular market participation to support capital projects. It has no variable-rate or direct-purchase

debt that could pressure liquidity.

Weak debt and contingent liability profile

In our view, Danvers's debt and contingent liability profile is weak. Total governmental fund debt service is 4.9% of

total governmental fund expenditures and net direct debt is 74.7% of total governmental fund revenue. Overall net

debt is low, at 1.7% of market value, which is in our view a positive credit factor.

After this issuance, the town will have about $110 million in total direct debt outstanding, with about 63% of bonds

outstanding expected to be repaid over the next 10 years. Currently, the town does not have any sizable debt offerings

planned. The town typically funds capital outlay using one-time revenues instead of debt; as a result, we don't

anticipate any meaningful deterioration of its debt profile.

Pension and other postemployment benefits

In our opinion, a credit weakness is Danvers' large pension and OPEB obligation, particularly given the pension

system's and OPEB trust's low funded ratios.

While the use of an actuarially determined contribution (ADC) is a positive, we believe some of the assumptions used

to build the pension ADC reflect what we view as slightly weak assumptions and methodologies, which we believe

increases the risk of unexpected contribution escalations.

Notably, the plan did not meet either our static or minimum funding progress metrics in the most recent year,

indicating that the current plan assumptions are not making progress in funding the outstanding liability. Although the

town continues to pay its full ADC, if pension costs increase faster than the overall budget, the operating budget could

be pressured.

Although OPEB liabilities are predominantly funded on a pay-as-you-go basis, costs remain manageable despite the

large liability, and we expect the town will continue adding to its OPEB trust fund.

As of June 30, 2020, the town participated in the following pension plan:

• Danvers Contributory Retirement System, which covers substantially all employees of the town except for teachers

and school administrators: 61% funded, with a $90.55 million net pension liability.

• Danvers' combined required pension and actual OPEB contributions totaled 11.4% of total governmental fund

expenditures in 2020, excluding payments made by the electric division. Of that amount, 6.4% represented required

contributions made by the town toward its pension obligations and 5.0% represented OPEB payments.




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Danvers has adopted a funding schedule for its pension liability, aiming to fully fund it by 2035 but relying on

escalating contributions to meet its funding targets. This is a common funding structure in the commonwealth, which

could lead to costs outpacing Danvers' revenue growth (for more information, see "Pension Spotlight: Massachusetts,"

Oct. 14, 2020). It has also adopted a more conservative plan by revising its projected rate of return downward again to

7.50%, from 7.75%, although we still believe this figure could lead to contribution volatility.

In regard to the OPEB obligation, the town is committed to increasing its contribution amount, as well as establishing

an OPEB trust fund in place of the OPEB stabilization fund. Excluding the enterprise divisions, Danvers had a net

OPEB liability of $192.3 million. Officials estimate the trust fund had a balance of $7.9 million at the close of 2020.

Additionally, the town plans to begin meaningfully contributing toward the OPEB trust fund with new revenue streams

and redirect annual pension contributions to OPEBs when the pension plan is fully funded.

Strong institutional framework

The institutional framework score for Massachusetts municipalities is strong.

Related Research

• Through The ESG Lens 2.0: A Deeper Dive Into U.S. Public Finance Credit Factors, April 28, 2020

Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed

to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com for

further information. Complete ratings information is available to subscribers of RatingsDirect at www.capitaliq.com. All ratings affected by this rating

action can be found on S&P Global Ratings' public website at www.standardandpoors.com. Use the Ratings search box located in the left column.




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BASIS OF ACCOUNTING & BUDGETING

BASIS OF ACCOUNTING

The modified accrual basis of accounting is used by all governmental fund types. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual, that is, when they become both measurable and available. “Measurable” means the amount of the transaction can be determined, and “available” means collectible within the current period, or soon enough thereafter to be used to pay liabilities of the current period. The Town considers property taxes as available if they are collected within up to 60 days after year‐end. Expenditures are recorded when the related fund liability is incurred. Principal and interest on general long‐term debt are recorded as fund liabilities when due.

BASIS OF BUDGETING

An annual budget is adopted by Town Meeting for the Town’s General Water, and Sewer Fund. Town Meeting approval is also required for spending limits on revolving funds and for capital projects. The Town’s General Fund annual budget is adopted on a statutory basis that differs in some respects from generally accepted accounting principles (GAAP). The major differences between the budgetary basis and GAAP accounting basis are:

1. Budgeted revenues are recorded when cash is received (budgetary basis), as opposed to whensusceptible to accrual (GAAP). The property tax levy is recorded as a receivable when levied but then isfully reserved until collected.

2. Encumbrances are treated as expenditures in the year the commitment is made. Certain appropriations,voted by Town Meeting apart from the main budget articles, are referred to as “Warrant Articles” andunder state law are a continuing authorization until the purposes for which the appropriation was initiallymade have been certified as completed.

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FUNDS SUBJECT TO APPROPRIATION

General Fund ‐ The General Fund is established to account for all resources obtained and used for those services commonly provided by the Town which are not accounted for in any other fund. These services include among other items: General Government, Public Safety, Education, Public Works, Health and Human Services, Culture and Recreation, and Employee Benefits. The primary sources of revenue of the General Fund are property taxes, motor vehicle excise taxes, unrestricted state grants, and fees for services rendered.

1. General Governmenta. Moderatorb. Select Boardc. Managementd. Information Technologye. Department Head Salariesf. Finance Committee Reserve Fundg. Accountingh. Assessingi. Treasurer/Collectorj. Legal Counselk. Human Resourcesl. Town Clerk

2. Public Safetya. Police Departmentb. Fire Department

3. Education4. Public Works5. Health and Human Services

a. Land use & Community Services6. Culture and Recreation

a. Recreation Departmentb. Library

7. Employee Benefits8. Debt Service9. Intergovernmental10. Various Articles11. Transfers Out

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FUND BALANCE CLASSIFICATION

Fund balances are segregated to account for resources that are either not available for expenditure in the future or are legally set aside for a specific future use.

The Town implemented GASB Statement No. 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions, which enhances the usefulness of fund balance information by providing clearer fund balance classifications that can be more consistently applied and by clarifying existing governmental fund type definitions. The following types of fund balances are reported at June 30, 2020:

Nonspendable – Represents amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. This fund balance classification includes general fund reserves for prepaid expenditures and nonmajor governmental fund reserves for the principal portion of permanent trust funds.

Restricted – Represents amounts that are restricted to specific purposes by constraints imposed by creditors, grantors, contributors, or laws or regulations of other governments, or constraints imposed by law through constitutional provisions or enabling legislation. This fund balance classification includes general fund encumbrances funded by bond issuances, various special revenue funds, and the income portion of permanent trust funds.

Committed – Represents amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the Town’s highest level of decision‐making authority, the passing of warrant articles by majority vote at Town Meeting. This fund balance classification includes general fund encumbrances for non‐lapsing, special article appropriations approved at Town Meeting, special purpose stabilization funds, and other reserve funds set aside by Town Meeting vote for specific and non‐routine future capital acquisitions and improvements (now reported as part of the general fund per GASB 54), and various special revenue funds. The Town’s stabilization accounts are authorized in accordance with Massachusetts General Law Chapter 40, section 5B. The creation of, appropriation into, and appropriation out of the stabilization account requires two‐thirds approval at Town Meeting.

Assigned – Represents amounts that are constrained by the Town’s intent to use these resources for a specific purpose as established by management. This fund balance classification includes general fund encumbrances that have been established by various Town departments for the expenditure of current year budgetary financial resources upon vendor performance in the subsequent budgetary period. The Town follows an informal policy that permits the Town Manager to assign fund balance amounts to a specific purpose, although fund balance to be applied against a subsequent year’s budget is voted by Town Meeting through formal warrant articles.

Unassigned – Represents amounts that are available to be spent in future periods. The general fund is the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it is not appropriate to report a positive unassigned fund balance amount. However, in governmental funds other than the general fund, if expenditures incurred for specific purpose exceed the amounts that are restricted, committed, or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund.

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The Town has classified its fund balances with the following hierarchy.

TotalGeneral Capital GovernmentalFund Projects Fund Funds

NonspendableNonexpendable permanent funds $ ‐ $ ‐ $ 87,067 $ 87,067

Total Nonspendable ‐ ‐ 87,067 87,067

RestrictedBonded projects ‐ 7,913,916 ‐ 7,913,916 Special revenue fundsCircuit breaker ‐ ‐ 1,089,124 1,089,124 Water use mitigation ‐ ‐ 898,046 898,046 Childcare revolving ‐ ‐ 745,247 745,247 Housing trust ‐ ‐ 667,242 667,242 Student athletic activity fees ‐ ‐ 529,763 529,763 Recreation revolving ‐ ‐ 444,319 444,319 911 department support ‐ ‐ 435,751 435,751 FEMA storm reimbursement ‐ ‐ 299,080 299,080 Premium of sale of bonds/BANs ‐ ‐ 272,457 272,457 School lunch ‐ ‐ 211,167 211,167 Drug enforcement ‐ ‐ 197,924 197,924 Senior Services DCOA ‐ ‐ 190,999 190,999 Hilltop estates (open space) ‐ ‐ 149,951 149,951 Conservation ‐ ‐ 139,933 139,933 Summer school registrations ‐ ‐ 113,556 113,556 Parking receipts ‐ ‐ 108,427 108,427 Preservation revolving ‐ ‐ 103,876 103,876 Rail trail expansion ‐ ‐ 100,000 100,000 Other ‐ ‐ 1,392,488 1,392,488

Expendable permanent funds ‐ ‐ 364,636 364,636

Total Restricted ‐ 7,913,916 8,453,986 16,367,902

CommittedStabilization and other reserves:Health claims trust 18 ‐ ‐ 18Claims reserves 48,000 ‐ ‐ 48,000 Debt stabilization 4,457,829 ‐ ‐ 4,457,829 Revenue stabilization 485 ‐ ‐ 485Education stabilization 94 ‐ ‐ 94Other stabilization 5,918 ‐ ‐ 5,918

For next year's expenditures:Debt stabilization 785,000 ‐ ‐ 785,000

Total Committed 5,297,344 ‐ ‐ 5,297,344

AssignedEncumbered for:General government 412,411 ‐ ‐ 412,411 Public safety 34,226 ‐ ‐ 34,226 Education 123,003 ‐ ‐ 123,003 Public works 1,317,607 ‐ ‐ 1,317,607 Health and human services 212,146 ‐ ‐ 212,146 Culture and recreation 45,298 ‐ ‐ 45,298 Employee benefits 34,400 ‐ ‐ 34,400

For next year's expenditures:OPEB 400,000 ‐ ‐ 400,000 Debt service 345,000 ‐ ‐ 345,000 Capital outlay 720,863 ‐ ‐ 720,863 Building maintenance 288,560 ‐ ‐ 288,560 Other 1,197,756 ‐ ‐ 1,197,756

Total Assigned 5,131,270 ‐ ‐ 5,131,270

UnassignedGeneral fund 8,016,788 ‐ ‐ 8,016,788 General stabilization fund 3,099,203 ‐ ‐ 3,099,203 Special revenue fund deficits ‐ ‐ (938,079) (938,079) Capital project fund deficits ‐ (1,437,193) ‐ (1,437,193)

Total Unassigned 11,115,991 (1,437,193) (938,079) 8,740,719

Total Fund Balance $ 21,544,605 $ 6,476,723 $ 7,602,974 $ 35,624,302

Source: Town of Danvers Comprehensive Annual Financial Report as of June 30, 2020

GovernmentalNonmajor

Funds

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NONMAJOR GOVERNMENTAL FUNDS

SPECIAL REVENUE FUNDS

Special Revenue Funds are established to account for resources obtained and expended for specified purposes and restricted by law or local action.

Special Revenue Funds are established for the following purposes:

School Lunch Fund: To account for operating activities associated with the School Department student lunch program.

Grants: To account for various Town and School Department related Federal and state grant programs.

Receipts Reserved: To account for various receipts, which according to Massachusetts General Laws, must be appropriated to be spent for certain specific purposes.

Revolving Accounts: To account for certain receipts, which according to Massachusetts General Laws can be spent without appropriation, for expenditures related to the source of the receipt.

Conservation: To account for revenue and expenditures associated with acquiring conservation land.

Housing Trust: To account for revenue and expenditures associated with affordablehousing.

Other Funds: To track gifts and other receipts that are restricted for specific expenditures.

PERMANENT FUNDS

Permanent Funds are used to report resources that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support the Town’s programs ‐ that is, for the benefit of the Town or its citizenry.

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64 Cabot Rd, Danvers, MA 01923 978.777.4800 978.777.8931

danverspublicschools.org

Caring. Quality. Commitment. Collaboration.

Keith Taverna Assistant Superintendent of Finance and Personnel

978.774.4800 ext. 2432 [email protected]

Lisa Dana, Ed.D. Superintendent of Schools


Mary Wermers Assistant Superintendent of Teaching and Learning


March 1, 2021

Dear School Committee, Select Board, Finance Committee and Town Meeting Members,

Please see an outline of changes to the School Department FY22 Budget Request. We will continue to work collaboratively with all parties, including Town Hall and boards and committees to provide a fiscally responsible and balanced budget for the Town of Danvers. School Committee will formally vote on the revised budget proposal at their March 8, 2021 meeting.

We feel the reductions made from our original request are manageable and will allow us to continue a high level of service and education for the children and families of the Danvers Public Schools. Reductions include additional savings from a retirement we were informed of after the initial budget was set and additional use of excess FY21 Circuit Breaker revenue. The following reductions are proposed:

Management Reserve: $33,000 Tuition Out: $57,682 Total Reduction: $90,682

Attached to this document is an updated executive summary and two-page budget summary which reflect these changes to accompany our full budget as presented through our original request. The new proposed FY22 School Department Budget is $44,673,035 or an $1,170,880 increase over FY21 which represents an 2.69% increase.

Please do not hesitate to reach out with any questions.

Sincerely,

Lisa Dana and Keith Taverna

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FY22 Danvers Public Schools Budget Executive Summary – Plan B

The enclosed budget proposal focuses primarily on funding special education out-of-district tuitions and anticipated contractual obligations for FY22. This budget also contains slight increases that support the implementation of our strategic priorities of Student Engagement and Social and Emotional Learning. We are able to focus on the strategic plan initiatives while reallocating and maximizing our current resources to meet changing student needs. FY22 continues to present challenges due to the ongoing global pandemic, unstable local revenues and unknown state aid.

Proposed this year is a net increase of 1.0 positions as we focus on the reallocation of resources to meet the changing needs of students. Due to increasing enrollment, a 1.0 classroom teacher is proposed for the Smith School to account for the growing size of grade-level cohorts. At Great Oak, a 1.0 classroom teacher reduction is proposed to account for a smaller incoming grade 1 cohort. An increase of 1.0 teacher aide is seen for Highlands School due to changing and increased student need.

During the 2019-2020 school year, the District saw 10 additional students move in who attend out-of-district placements. Through a cash infusion of $677,000 in FY21 from savings in debt, the general government operating budget and the use of the education reserve account, we were able to bridge the budget gap as part of a two-year plan. As part of the FY22 budget, and year two of the plan, there is a one-time use of excess circuit breaker revenue received in FY21 to offset the FY22 budget in the amount of $224,682. The use of this funding allows the net proposed increase to total $13,875 instead of $238,557 for FY22. By utilizing these funds, the District and Town are able to continue to maximize resources as we deal with the financial fallout from the ongoing pandemic.

Non-salary accounts for FY22 have a proposed net increase of $83,000. A net increase of $29,000 is proposed for special education expenses, including tuition-out and contracted services. An increase of $15,000 is proposed to fund costs associated with athletic training and transportation service contracts. As we continue to focus on student engagement, a net increase of $22,000 is seen in curriculum materials primarily to fund elementary science consumables and the continuation of the elementary ST Math program.

Overall, the FY22 budget reflects anticipated increases in contractual obligations as the District is in collective bargaining with all four unions. An increase of $20,000 in staffing needs and savings of $137,000 from retirements are reflected in the proposed budget. The budget also reflects a net increase of $83,000 in non-salary accounts, including an increase of $29,000 for special education obligations, a $7,000 increase in transportation services and increases of $47,000 in supplies, books/licenses/curriculum resources and other non-salary accounts. This results in a total budget increase request of $1,170,880 or 2.69%.

For a full version of the budget, please visit our website at: http://danverspublicschools.org/.

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ACCOUNTFY21 Operating

BudgetFY22 Budget

Request ChangeSALARIES110 ADMINISTRATIVE TEAM 2,461,570 2,461,570 0 0%111 ADMINISTRATIVE ASSISTANTS 806,898 806,898 0 0%113 ELEMENTARY TEACHERS 9,681,902 9,681,902 0 0%114 MIDDLE SCHOOL TEACHERS 5,774,446 5,774,446 0 0%115 HIGH SCHOOL TEACHERS 6,470,482 6,470,482 0 0%116 RETIREMENT PAYMENTS 0 0 0117 INTERSCHOLASTIC COACHES 96,355 96,355 0 0%119 CO-CURRICULAR POSITIONS 317,743 317,743 0 0%120 CONTRACTUAL STIPENDS 108,414 108,414 0 0%121 TEACHER AIDES 2,063,175 2,083,175 20,000 1%123 SUBSTITUTES 176,994 176,994 0 0%124 TUTORS 38,825 38,825 0 0%126 SUPPORT PERSONNEL 1,229,231 1,229,231 0 0%127 TECHNOLOGY 462,223 462,223 0 0%151 ELEMENTARY SPEC. ED. TEACHERS 1,530,650 1,530,650 0 0%152 MIDDLE SCHOOL SPEC. ED. TEACHERS 538,625 538,625 0 0%153 SPEECH THERAPISTS 569,311 569,311 0 0%154 SCHOOL PSYCHOLOGISTS 522,095 522,095 0 0%155 HIGH SCHOOL SPEC. ED. TEACHERS 1,063,200 1,063,200 0 0%156 ELL TEACHERS 277,690 277,690 0 0%161 CENTRAL OFFICE 307,101 307,101 0 0%165 NURSES 741,784 741,784 0 0%168 STAFF DEVELOPMENT 57,560 57,560 0 0%179 LONGEVITY 104,850 109,900 5,050 5%180 ATTENDANCE INCENTIVE 38,380 38,380 0 0%181 MANAGEMENT RESERVE 241,208 1,308,868 1,067,660 443%

SALARIES TOTAL 35,680,712 36,773,422 1,092,710 3%SUPPLIES

200 ELEMENTARY SUPPLIES 69,451 69,451 0 0%201 CLASSROOM SUPPLIES 136,799 136,271 (528) 0%202 COMPUTER SUPPLIES 27,150 27,150 0 0%203 TECHNOLOGY SUPPLIES 5,200 5,200 0 0%204 COPYING SUPPLIES 38,795 38,795 0 0%207 LIBRARY SUPPLIES 2,920 2,920 0 0%208 MEDICAL SUPPLIES 12,226 12,226 0 0%211 ASSESSMENT SUPPLIES 18,000 18,000 0 0%214 ATHLETIC SUPPLIES 34,279 34,279 0 0%226 STUDENT ACTIVITIES 23,090 23,090 0 0%228 GRADUATION EXPENSES 12,300 12,300 0 0%

SUPPLIES TOTAL 380,210 379,682 (528) 0%

DANVERS PUBLIC SCHOOLSFY22 BUDGET SUMMARY

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ACCOUNTFY21 Operating

BudgetFY22 Budget

Request Change

DANVERS PUBLIC SCHOOLSFY22 BUDGET SUMMARY

BOOKS/LICENSES/SOFTWARE301 TEXTBOOKS 320,283 344,350 24,067 8%302 WORKBOOKS 3,000 3,000 0 0%303 LIBRARY BOOKS 47,650 47,650 0 0%304 TRADE BOOKS 6,928 6,191 (737) -11%305 REBINDING BOOKS 2,000 2,000 0 0%306 LICENSES/SOFTWARE 219,262 231,393 12,131 6%

BOOKS/LICENSES/SOFTWARE 599,123 634,584 35,461 6%EQUIPMENT402 EQUIPMENT MAINTENANCE 94,390 93,490 (900) -1%405 EQUIPMENT ACQUIS. & REPLACE. 494,675 494,675 0 0%

EQUIPMENT TOTAL 589,065 588,165 (900) 0%SERVICES501 CONTRACTED SUBS. 208,060 208,060 0 0%502 ACCOUNTING/AUDITING 30,000 30,000 0 0%504 LEGAL SERVICES 100,000 100,000 0 0%505 STRATEGIC PLAN 25,000 25,000 0 0%509 MEDICAL SERVICES 7,625 7,625 0 0%511 PROGRAM DEVELOPMENT 142,445 142,445 0 0%

SERVICES TOTAL 513,130 513,130 0 0%ATHLETIC SERVICES514 ATHLETIC CONTRACT SERVICES 23,854 32,000 8,146 34%601 ATHLETIC RENTALS & FEES 0 0 0

ATHLETIC SERVICES TOTAL 23,854 32,000 8,146 34%SPECIAL EDUCATION SERVICES605 CONTRACTUAL SERVICES 753,646 762,338 8,692 1%606 TUITION OUT 3,391,255 3,405,130 13,875 0%607 EXTENDED SERVICES 225,000 231,750 6,750 3%

SPECIAL EDUCATION SERVICES TOTAL 4,369,901 4,399,218 29,317 1%ADMINISTRATIVE701 OFFICE SUPPLIES 15,250 15,250 0 0%702 POSTAGE 21,162 21,162 0 0%703 PRINTING 4,000 4,000 0 0%704 CONFERENCES 21,000 21,000 0 0%705 MEMBERSHIPS AND DUES 31,135 31,135 0 0%706 SUBSCRIPTIONS 8,525 8,525 0 0%707 TELEPHONE 32,953 32,953 0 0%708 ADVERTISING 10,000 10,000 0 0%709 TRANSPORTATION 9,000 9,000 0 0%710 OUT-OF-STATE TRAVEL 3,000 3,000 0 0%

ADMINISTRATIVE TOTAL 156,025 156,025 0 0%TRANSPORTATION801 REGULAR BUSING 556,135 562,809 6,674 1%802 504 / HOMELESS TRANSPORTATION 30,000 30,000 0 0%803 SPECIAL EDUCATION TRANSPORTATION 565,000 565,000 0 0%804 ATHLETIC TRIPS 20,000 20,000 0 0%805 SCHOOL-OWNED VEHICLES 19,000 19,000 0 0%

TRANSPORTATION TOTAL 1,190,135 1,196,809 6,674 1%

BUDGET TOTAL 43,502,155 44,673,035 1,170,8802.69%

143

Charges to Charges to Charges to Total

Service Provider Electric Water Sewer Charges

($) ($) ($) ($)

Administrative Services 147,883 31,656 21,854 201,392

Town Accountant 136,176 29,150 20,124 185,450

Management Services 82,015 17,556 12,120 111,691

Information Technology 174,470 37,347 25,783 237,600

Human Resources 87,762 18,786 12,969 119,517

Public Works ‐ Tax 92,433 136,313 133,565 362,312

TOTAL 720,740 270,807 226,415 1,217,962

FISCAL YEAR 2022 SUPPORT SERVICES

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GLOSSARY

Abatement – A reduction or elimination of a real or

personal property tax, motor vehicle excise, a fee, charge,

or special assessment imposed by a governmental unit.

Agency Fund – This is one of four types of fiduciary funds.

It is used to report resources in a purely custodial capacity

by a governmental unit. Agency funds generally involve only

the receipt, temporary investment, and periodic transfer of

money to fulfill legal obligations to individuals, private

organizations, or other governments. For example, certain

employee payroll withholdings typically accumulate in an

agency fund until due and forwarded to the federal

government, health care provider, and so forth.

Amortization – The gradual repayment of an obligation

over time and in accordance with a pre‐ determined

payment schedule.

Appellate Tax Board (ATB) – Appointed by the governor,

the ATB has jurisdiction to decide appeals from local

decisions relating to property taxes, motor vehicle excises,

state owned land (SOL) valuations, exemption eligibility,

property classification, and equalized valuations.

Appropriation – An authorization granted by a town

meeting, city council or other legislative body to expend

money and incur obligations for specific public purposes. An

appropriation is usually limited in amount and as to the

time period within which it may be expended. (See

Encumbrance, Line‐Item Transfer, Free Cash)

Assessed Valuation – A value assigned to real estate or

other property by a government as the basis for levying

taxes.

Assigned Fund Balance – Amounts in the assigned fund

balance classification are intended to be used by the

government for specific purposes but do not meet the

criteria to be classified as restricted or committed. In

governmental funds other than the general fund, assigned

fund balance represents the remaining amount that is not

restricted or committed.

Audit – An examination of a community's financial systems,

procedures, and data by a certified public accountant

(independent auditor), and a report on the fairness of

financial statements and on local compliance with statutes

and regulations. The audit serves as a valuable

management tool for evaluating the fiscal performance of a

community.

Audit Report – Prepared by an independent auditor, an audit report includes: (a) a statement of the scope of the

audit; (b) explanatory comments as to application of

auditing procedures; (c) findings and opinions; (d) financial

statements and schedules; and (e) statistical tables,

supplementary comments, and recommendations. It is

almost always accompanied by a management letter.

Balance Sheet – A statement that discloses the assets,

liabilities, reserves, and equities of a fund or governmental

unit at a specified date.

Boat Excise – In accordance with MGL Chapter 60B, this is

an amount levied on boats and ships in lieu of a personal

property tax for the privilege of using the Commonwealth’s

waterways. Assessed annually as of July 1, the excise is paid

to the community where the boat or ship is usually moored

or docked.

Bond – A means to raise money through the issuance of

debt. A bond issuer/borrower promises in writing to repay

a specified sum of money, alternately referred to as face

value, par value or bond principal, to the buyer of the bond

on a specified future date (maturity date), together with

periodic interest at a specified rate. The term of a bond is

always greater than one year. (See Note)

Bond Anticipation Note (BAN) – Short‐term debt

instrument used to generate cash for initial project costs

and with the expectation that the debt will be replaced later

by permanent bonding. Typically issued for a term of less

than one year, BANs may be re‐issued for up to five years,

provided principal repayment begins after two years (MGL

Ch. 44 §17). Principal payments on school related BANs may

be deferred up to seven years (increased in 2002 from five

years) if the community has an approved project on the

Massachusetts School Building Authority (MSBA) priority

list. BANs are full faith and credit obligations.

Bond Authorization – The action of town meeting or a city

council authorizing the executive branch to raise money

through the sale of bonds in a specific amount and for a

specific purpose. Once authorized, issuance is by the

treasurer upon the signature of the mayor, or select

board. (See Bond Issue)

Bond Premium – The difference between the market price

of a bond and its face value (when the market price is

higher). A premium will occur when the bond’s stated

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interest rate is set higher than the true interest cost (the

market rate). Additions to the levy limit for a Proposition 2

½ debt exclusion are restricted to the true interest cost

incurred to finance the excluded project. Premiums

received at the time of sale must be offset against the

stated interest cost in computing the debt exclusion. If

receipt of the premium and the payment of interest at

maturity of an excluded debt occur in different fiscal years,

reservation of the premium for future year’s debt service is

required at the end of the fiscal year when the premium

was received. (See DOR Bulletin 2003‐20B) Muni Mod Act

Bond Rating (Municipal) – A credit rating assigned to a

municipality to help investors assess the future ability, legal

obligation, and willingness of the municipality (bond issuer)

to make timely debt service payments. Stated otherwise, a

rating helps prospective investors determine the level of

risk associated with a given fixed‐income investment.

Rating agencies, such as Moody's and Standard and Poor’s,

use rating systems, which designate a letter or a

combination of letters and numerals where AAA is the

highest rating and C1 is a very low rating.

Bonds Authorized and Unissued – Balance of a bond

authorization not yet sold. Upon completion or

abandonment of a project, any remaining balance of

authorized and unissued bonds may not be used for other

purposes, but must be rescinded by town meeting or the

city council to be removed from community's books.

Budget – A plan for allocating resources to support

particular services, purposes and functions over a specified

period of time. (See Level Funded Budget, Performance

Budget, Program Budget, Zero Based Budget)

Bureau of Accounts (BOA) – A bureau within the State

Division of Local Services charged with overseeing

municipal execution of financial management laws, rules

and regulations.

Bureau of Local Assessment (BLA) – A bureau within the

State Division of Local Services charged with overseeing

municipal execution of state laws, rules and regulations

involving real and personal property assessments.

Business‐Type Activities – One of two classes of activities

reported in the GASB 34 government‐wide financial

statements. These activities are financed in whole or in part

by fees charged to users for goods or services. Some

examples are enterprise (MGL Chapter 44 §53F½), special

revenue (MGL Ch. 44 §69B) water, and municipal electric

fund.

CAMA – Computer‐Assisted Mass Appraisal software

program.

Capital Assets – All tangible property used in the operation

of government, which is not easily converted into cash, and

has an initial useful life extending beyond a single financial

reporting period. Capital assets include land and land

improvements; infrastructure such as roads, bridges, water

and sewer lines; easements; buildings and building

improvements; vehicles, machinery and equipment.

Communities typically define capital assets in terms of a

minimum useful life and a minimum initial cost. (See Fixed

Asset)

Capital Budget – An appropriation or spending plan that

uses borrowing or direct outlay for capital or fixed asset

improvements. Among other information, a capital budget

should identify the method of financing each

recommended expenditure, i.e., tax levy or rates, and

identify those items that were not recommended. (See

Capital Asset, Fixed Asset)

Capital Improvements Program – A blueprint for planning

a community's capital expenditures that comprises an

annual capital budget and a five‐year capital program. It

coordinates community planning, fiscal capacity and

physical development. While all of the community’s needs

should be identified in the program, there is a set of criteria

that prioritizes the expenditures.

Capital Outlay – The exchange of one asset (cash) for

another (capital asset), with no ultimate effect on net

assets. Also known as "pay as you go," it is the appropriation

and use of available cash to fund a capital improvement, as

opposed to incurring debt to cover the cost.

Capital Projects Fund – Fund type used to account for

financial resources to be used for the acquisition or

construction of major capital facilities (other than those

financed by proprietary funds).

146

Certification – Verification of authenticity. Can refer to the

action of a bank, trust company, or DOR’s Bureau of

Accounts (BOA) in the issuance of State House Notes, to

confirm the genuineness of the municipal signatures and

seal on bond issues. The certifying agency may also

supervise the printing of bonds and otherwise safeguard

their preparation against fraud, counterfeiting, or over‐

issue. Also refers to the certification by the Bureau of Local

Assessment (BLA) that a community’s assessed values

represent full and fair cash value (FFCV). (See Triennial

Revaluation)

Chapter 70 School Aid – Chapter 70 refers to the school

funding formula created under the Education Reform Act of

1993 by which state aid is distributed through the Cherry

Sheet to help establish educational equity among municipal

and regional school districts.

Chapter 90 Highway Funds – State funds derived from

periodic transportation bond authorizations and

apportioned to communities for highway projects based on

a formula under the provisions of MGL Ch. 90 §34. The

Chapter 90 formula comprises three variables: local road

mileage (58.33 percent) as certified by the Massachusetts

Highway Department (MHD), local employment level (20.83

percent) derived from the Department of Employment and

Training (DET), and population estimates (20.83 percent)

from the US Census Bureau. Local highway projects are

approved in advance. Later, on the submission of certified

expenditure reports to MHD, communities receive cost

reimbursements to the limit of the grant.

Chapter Land – Forest, agricultural/horticultural, and

recreational lands classified, valued and taxed according to

MGL Chapters 61, 61A, and 61B.

Cherry Sheet – Named for the cherry colored paper on

which they were originally printed, the Cherry Sheet is the

official notification to cities, towns and regional school

districts of the next fiscal year’s state aid and assessments.

The aid is in the form of distributions, which provide funds

based on formulas and reimbursements that provide funds

for costs incurred during a prior period for certain programs

or services. Links to the Cherry Sheets are located on the

DLS website at www.mass.gov/dls. (See Cherry Sheet

Assessments, Estimated Receipts)

Cherry Sheet Assessments – Estimates of annual charges to

cover the cost of certain state and county programs.

Cherry Sheet Offset Items – Local aid that may be spent

without appropriation in the budget, but which must be

spent for specific municipal and regional school district

programs. Current offset items include racial equality

grants, school lunch grants, and public libraries grants. (See

Offset Receipts)

CIP – Can refer to an abbreviation for Commercial,

Industrial, and Personal properties by the Bureau of Local

Assessment (BLA). It also can refer to Capital Improvements

Program.

Collective Bargaining – The process of negotiating workers'

wages, hours, benefits, working conditions, etc., between

an employer and some or all of its employees, who are

represented by a recognized labor union.

Commitment – This establishes the liability for individual

taxpayers. For example, the assessors' commitment of real

estate taxes fixes the amount that the collector will bill and

collect from property owners.

Consumer Price Index (CPI) – The statistical measure of

changes, if any, in the overall price level of consumer goods

and services. The index is often called the "cost‐of‐living

index."

Cost of Living Adjustment (COLA) – It is often used in

municipal contracts that provide for annual or periodic

increases in salaries and wages for employees over the

course of the contract. The amount of an increase is most

often negotiated based on a community's ability to pay, but

is sometimes tied to the annual change in a specified index,

i.e., consumer price index (CPI). In Massachusetts, it is also

used in the Optional Cost of Living Adjustment for Property

Exemptions.

Debt Authorization – Formal approval by a two‐thirds vote

of town meeting or city council to incur debt, in accordance

with procedures stated in MGL Ch. 44 §1, 2, 3, 4a, 6‐15.

Debt Exclusion – An action taken by a community through

a referendum vote to raise the funds necessary to pay debt

service costs for a particular project from the property tax

147

levy, but outside the limits under Proposition 2½. By

approving a debt exclusion, a community calculates its

annual levy limit under Proposition 2½, then adds the

excluded debt service cost. The amount is added to the levy

limit for the life of the debt only and may increase the levy

above the levy ceiling.

Debt Limit – The maximum amount of debt that a

municipality may authorize for qualified purposes under

state law. Under MGL Ch. 44 §10, debt limits are set at 5

percent of EQV. By petition to the Municipal Finance

Oversight Board, cities and towns can receive approval to

increase their debt limit to 10 percent of EQV.

Debt Policy – Part of an overall capital financing policy that

provides evidence of a commitment to meet infrastructure

needs through a planned program of future financing. Debt

policies should be submitted to elected officials for

consideration and approval.

Debt Service – The repayment cost, usually stated in annual

terms and based on an amortization schedule, of the

principal and interest on any particular bond issue.

Demand Letter – Notice to a delinquent taxpayer of

overdue taxes or charges typically mailed soon after

payment period has ended. While it is a courtesy, there is

no requirement to issue correspondence of this type.

DESE – Department of Elementary & Secondary Education

(formerly Department of Education, DOE)

DLS – Division of Local Service

DOR – Department of Revenue

Eminent Domain – The power of a government to take

property for public purposes. Frequently used to obtain real

property that cannot be purchased from owners in a

voluntary transaction.

Encumbrance – A reservation of funds to cover obligations

arising from purchase orders, contracts, or salary

commitments that is chargeable to, but not yet paid from,

a specific appropriation account.

Enterprise Fund – An enterprise fund, authorized by MGL

Ch. 44 §53F½, is a separate accounting and financial

reporting mechanism for municipal services for which a fee

is charged in exchange for goods or services. It allows a

community to demonstrate to the public the portion of

total costs of a service that is recovered through user

charges and the portion that is subsidized by the tax levy, if

any. With an enterprise fund, all costs of service delivery‐‐

direct, indirect, and capital costs‐‐are identified. This allows

the community to recover total service costs through user

fees if it chooses. Enterprise accounting also enables

communities to reserve the "surplus" or net assets

unrestricted generated by the operation of the enterprise

rather than closing it out to the general fund at year‐end.

Services that may be treated as enterprises include, but are

not limited to, water, sewer, hospital, and airport services.

See DOR IGR 08‐101

Estimated Receipts – A term that typically refers to

anticipated local revenues listed on page three of the Tax

Recapitulation Sheet. Projections of local revenues are

often based on the previous year's receipts and represent

funding sources necessary to support a community's annual

budget.

Excess Levy Capacity – The difference between the levy

limit and the amount of real and personal property taxes

actually levied in a given year.

Exemption – A discharge, established by statute, from the

obligation to pay all or a portion of a property tax. The

exemption is available to particular categories of property

or persons upon the timely submission and approval of an

application to the assessors. Properties exempt from

taxation include hospitals, schools, houses of worship, and

cultural institutions. Persons who may qualify for

exemptions include disabled veterans, blind individuals,

surviving spouses, and seniors.

Expenditure – An outlay of money made by municipalities

to provide the programs and services within their approved

budget.

Federal Energy Regulatory Commission (FERC) ‐ The

Federal Energy Regulatory Commission, or FERC, is an

independent agency that regulates the interstate

transmission of electricity, natural gas, and oil.

148

Fair Market Value – (See Full and Fair Cash Value)

Fiduciary Funds – Repository of money held by a

municipality in a trustee capacity or as an agent for

individuals, private organizations, other governmental

units, and other funds. These include pension (and other

employee benefit) trust funds, investment trust funds,

private‐purpose trust funds, and agency funds.

Financial Statement – A presentation of the assets and

liabilities of a community as of a particular date and most

often prepared after the close of the fiscal year.

Fiscal Year (FY) – Since 1974, the Commonwealth and

municipalities have operated on a budget cycle that begins

July 1 and ends June 30. The designation of the fiscal year is

that of the calendar year in which the fiscal year ends. Since

1976, the federal government fiscal year has begun on

October 1 and ended September 30.

Fixed Assets – Long‐lived, tangible assets such as buildings,

equipment and land obtained or controlled as a result of

past transactions or circumstances.

Fixed Costs – Costs that are legally or contractually

mandated such as retirement, FICA/Social Security,

insurance, debt service costs or interest on loans.

Free Cash – Remaining, unrestricted funds from operations

of the previous fiscal year including unexpended free cash

from the previous year, actual receipts in excess of revenue

estimates shown on the tax recapitulation sheet, and

unspent amounts in budget line‐items. Unpaid property

taxes and certain deficits reduce the amount that can be

certified as free cash. The calculation of free cash is based

on the balance sheet as of June 30, which is submitted by

the community's auditor, accountant, or comptroller.

Important: free cash is not available for appropriation until

certified by the Director of Accounts.

Full and Fair Cash Value (FFCV) – Fair cash value has been

defined by the Massachusetts Supreme Judicial Court as

"fair market value, which is the price an owner willing but

not under compulsion to sell ought to receive from one

willing but not under compulsion to buy.

Fund Balance – The difference between assets and

liabilities reported in a governmental fund. Also known as

fund equity. (See Unreserved Fund Balance)

General Fund – The fund used to account for most financial

resources and activities governed by the normal town

meeting/city council appropriation process.

General Ledger – The accountant's record of original entry,

which is instrumental in forming a paper trail of all

government financial activity.

General Obligation Bonds – Bonds issued by a municipality

for purposes allowed by statute that are backed by the full

faith and credit of its taxing authority.

Generally Accepted Accounting Principles (GAAP) –

Uniform minimum standards and guidelines for financial

accounting and reporting that serve to achieve some level

of standardization.

Government Finance Officers Association (GFOA) – A

nationwide association of public finance professionals.

Governmental Accounting Standards Board (GASB) – The

ultimate authoritative accounting and financial reporting

standard‐setting body for state and local governments.

Governmental Funds – Funds generally used to account for

tax‐supported activities. There are five different types of

governmental funds: the general fund, special revenue

funds, capital projects funds, debt service funds, and

permanent funds.

Hotel/Motel Excise – A local option since 1985 that allows

a community to assess a tax on short‐term room occupancy.

The community may levy up to 4 percent of the charge for

stays of less than 90 days at hotels, motels and lodging

houses. The convention center legislation imposed an

additional 2.75 percent charge in Boston, Cambridge,

Springfield and Worcester.

International City/County Manager Association (ICMA) –

An international association of professional city and county

managers who serve local governments.

Indirect Cost – Costs of a service not reflected in the

operating budget of the entity providing the service. An

149

example of an indirect cost of providing water service

would be the value of time spent by non‐water department

employees processing water bills. A determination of these

costs is necessary to analyze the total cost of service

delivery. The matter of indirect costs arises most often in

the context of enterprise funds. (Support Services)

Informational Guideline Release (IGR) – A DLS publication

that outlines a policy, administrative procedure, or provides

a law update related to municipal finance. Refer to online

listing of IGRs.

Inside Debt – Municipal debt incurred for purposes

enumerated in MGL Ch. 44, §7, and measured against the

community's debt limit as set under Ch. 10. Consequently,

the borrowing is inside the debt limit and referred to as

inside debt. (See Outside Debt)

Interest – Compensation paid or to be paid for the use of

money, including amounts payable at periodic intervals or

discounted at the time a loan is made. In the case of

municipal bonds, interest payments accrue on a day‐to‐day

basis, but are paid every six months.

Interest Rate – The interest payable, expressed as a

percentage of the principal available, for use during a

specified period of time. It is always expressed in annual

terms.

Interim Year Valuation Adjustment – State law requires

that local assessed values reflect market value every year.

In between triennial revaluations, a community must

complete an annual analysis to determine whether an

interim year value adjustment is warranted and report the

results to BLA. Depending on market conditions and

property value trends, adjustments may increase, decrease

or leave values unchanged. (See IGR No. 05‐401)

Levy – The amount a community raises through the

property tax. The levy can be any amount up to the levy

limit, which is re‐established every year in accordance with

Proposition 2½ provisions.

Levy Ceiling – A levy ceiling is one of two types of levy (tax)

restrictions imposed by MGL Ch. 59 §21C (Proposition 2½).

It states that, in any year, the real and personal property

taxes imposed may not exceed 2½ percent of the total full

and fair cash value of all taxable property. Property taxes

levied may exceed this limit only if the community passes a

capital exclusion, a debt exclusion, or a special exclusion.

(See Levy Limit)

Levy Limit – A levy limit is one of two types of levy (tax)

restrictions imposed by MGL Ch. 59 §21C (Proposition 2½).

It states that the real and personal property taxes imposed

by a city or town may only grow each year by 2½ percent of

the prior year's levy limit, plus new growth and any

overrides or exclusions. The levy limit can exceed the levy

ceiling only if the community passes a capital expenditure

exclusion, debt exclusion, or special exclusion. (See Levy

Ceiling)

Lien – A legal claim against real or personal property to

protect the interest of a party (i.e., a city or town) to whom

a debt is owed (i.e., taxes). In the case of real property, the

lien in favor of a municipality automatically arises each

January 1, but must be secured through other action. (See

Lien Date)

Line‐Item Transfer – The reallocation of a budget

appropriation between two line‐items within an

expenditure category (e.g., salaries, expenses). Employed

as a management tool, line‐item transfer authority allows

department heads to move money to where a need arises

for a similar purpose and without altering the bottom line.

Whether or not line‐item transfers are permitted depends

on how the budget is presented (i.e., format) and what level

of budget detail town meeting approves.

Local Aid – Revenue allocated by the Commonwealth to

cities, towns, and regional school districts. Estimates of local

aid are transmitted to cities, towns, and districts annually

by the "Cherry Sheets." Most Cherry Sheet aid programs are

considered general fund revenues and may be spent for any

purpose, subject to appropriation.

Local Receipts – Locally generated revenues, other than

real and personal property taxes. Examples include motor

vehicle excise, investment income, hotel/motel tax, fees,

rentals, and charges. Annual estimates of local receipts are

shown on the tax rate recapitulation sheet. (See Estimated

Receipts)

Long‐Term Debt – Community borrowing, or outstanding

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balance at any given time, involving loans with a maturity

date of 12 months or more. (Also known as Permanent

Debt)

Market Value – (See Full and Fair Cash Value)

Maturity Date – The date that the principal of a bond

becomes due and payable in full.

Massachusetts Association of Assessing Officers (MAAO) –

A professional organization for individuals who are

assessors in Massachusetts.

Massachusetts Certified Public Purchasing Official

(MCPPO) – A certification and designation program for

public officials responsible for municipal procurements in

Massachusetts. (See Uniform Procurement Act)

Massachusetts Collectors and Treasurers Association

(MCTA) – A professional organization for individuals who

are municipal tax collectors or treasurers in Massachusetts.

Massachusetts Government Finance Officers Association

(MGFOA) – A professional organization promoting the

advancement of the profession of Public Finance in

Massachusetts.

Massachusetts Interlocal Insurance Association (MIIA) – A

non‐profit organization serving over 400 municipalities in

the Commonwealth in obtaining appropriate insurance and

liability coverage.

Massachusetts Municipal Association (MMA) – A

statewide organization for bringing together municipal

officials to develop and advocate uniform policies and share

information about providing municipal services.

Massachusetts Municipal Auditors and Accountants

Association (MMAAA) – A professional organization for

individuals who are municipal auditors or accountants and

others with an interest in these activities in Massachusetts.

Massachusetts Municipal Depository Trust (MMDT) – An

investment program, founded in 1977 under the

supervision of the State Treasurer, in which municipalities

may pool excess cash for investment.

Massachusetts School Building Authority (MSBA) –

Administers the state program that reimburses cities,

towns, and regional school districts varying percentages of

their school construction costs depending on the wealth of

the community or district and the category of

reimbursement. Projects that received their first

reimbursement payment prior to July 26, 2004 will continue

to get annual state payments to offset the related annual

debt service. Thereafter, cities, towns, and regional school

districts will receive a lump sum amount representing the

state’s share of the eligible project costs. (See DOR IGR 06‐

101)

MWPAT – Massachusetts Water Pollution Abatement Trust

MGL – Massachusetts General Laws

Motor Vehicle Excise (MVE) – A locally imposed annual tax

assessed to owners of motor vehicles registered to an

address within the community, in accordance with MGL

Chapter 60A. The excise tax rate is set by statute at $25.00

per $1000 of vehicle value.

Net School Spending (NSS) – School budget and municipal

budget amounts attributable to education, excluding long‐

term debt service, student transportation, school lunches

and certain other specified school expenditures. A

community’s NSS funding must equal or exceed the NSS

Requirement established annually by the Department of

Education (DOE). (See Education Reform Act of 1993)

New Growth – The additional tax revenue generated by

new construction, renovations and other increases in the

property tax base during a calendar year. It does not include

value increases caused by normal market forces or by

revaluations.

North of Boston Library Exchange (NOBLE) ‐ The North of

Boston Library Exchange is a consortium of 26 libraries on

the North Shore of Boston.

Offset Receipts – A local option that allows estimated

receipts of a particular department to be earmarked for use

of the department and appropriated to offset its annual

operating budget. If accepted, MGL Ch. 44 §53E limits the

amount of offset receipts appropriated to no more than the

actual receipts collected for the prior fiscal year. The

Director of Accounts must approve use of a higher amount

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before appropriation. Actual collections greater than the

amount appropriated close to the general fund at year‐end.

If actual collections are less, the deficit must be raised in the

next year’s tax rate.

OPEB (Other Postemployment Benefits) – Employees of

state and local governments may be compensated in a

variety of forms in exchange for their services. In addition

to a salary, many employees earn benefits over their years

of service that will not be received until after their

employment with the government ends. The most common

type of these postemployment benefits is a pension.

Postemployment benefits other than pensions generally

take the form of health insurance and dental, vision,

prescription, or other healthcare benefits provided to

eligible retirees, including in some cases their beneficiaries.

They may also include some type of life insurance. As a

group, these are referred to as OPEB. (See GASB 45)

Operating Budget – A plan of proposed expenditures for

personnel, supplies, and other expenses for the coming

fiscal year.

Other Amounts to be Raised (Tax Recapitulation Sheet) –

Amounts not appropriated but raised through taxation.

Generally, these are locally generated expenditures (e.g.,

overlay, teacher pay deferral, deficits) as well as state,

county and other special district charges. Because they

must be funded in the annual budget, special consideration

should be given to them when finalizing the budget

recommendations to the city council or town meeting.

Outside Debt – Municipal borrowing for purposes

enumerated in MGL Ch. 44, §8. Debt incurred that is not

measured against the community's debt limit per Ch. 10.

Consequently, the borrowing is outside the debt limit and

referred to as outside debt. (See Inside Debt)

Overlay (Overlay Reserve or Allowance for Abatements and

Exemptions) – An account established annually to fund

anticipated property tax abatements, exemptions and

uncollected taxes in that year.

Overlay Deficit – A deficit that occurs when the amount of

overlay raised in a given year is insufficient to cover

abatements, statutory exemptions, and uncollected taxes

for that year. Overlay deficits must be provided for in the

next fiscal year.

Overlay Surplus – Any balance in the overlay account of a

given year in excess of the amount remaining to be

collected or abated can be transferred into this account.

Override – A vote by a community at an election to

permanently increase the levy limit. An override vote may

increase the levy limit no higher than the levy ceiling. The

override question on the election ballot must state a

purpose for the override and the dollar amount. (See

Underride)

Payments in Lieu of Taxes – An agreement between a

municipality and an entity not subject to taxation, such as

charitable or educational organizations, in which the payer

agrees to make a voluntary payment to the municipality. By

law, a city or town must make such a payment to any other

community in which it owns land used for public purposes.

Pension (and other employee benefit) Trust Funds – A

fiduciary fund type used to report resources that are

required to be held in trust for the members and

beneficiaries of defined benefit pension plans, defined

contribution plans, other postemployment benefit (OPEB)

plans, or other employee benefit plans.

PERAC – The Public Employee Retirement Administration

oversees and directs the state retirement system and

administers benefits for members.

Personal Property – Movable items not permanently

affixed to, or part of the real estate. It is assessed separately

from real estate to certain businesses, public utilities, and

owners of homes that are not their primary residences.

Preliminary Tax – The tax bill for the first two quarters of

the fiscal year sent, no later than July 1, by communities on

a quarterly tax billing cycle. The tax due on a preliminary tax

bill can be no greater than the amount due in the last two

quarters of the previous fiscal year.

Procurement Officer – An individual defined under MGL Ch.

30B, §2 and authorized to procure supplies or services for a

governmental body. (Also known as Purchasing Agent)

Proposition 2½ – A state law enacted in 1980, Proposition

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2½ regulates local property tax administration and limits

the amount of revenue a city or town may raise from local

property taxes each year to fund municipal operations.

Proprietary Funds – Funds that account for government’s

business‐type activities (e.g., activities that receive a

significant portion of their funding through user charges).

The fund types included in proprietary funds are the

enterprise fund and the internal service fund.

Purchase Order – An official document or form authorizing

the purchase of products and services.

Recap Sheet – (See Tax Rate Recapitulation Sheet)

Receipts – Money collected by and within the control of a

community from any source and for any purpose.

Receivables – An expectation of payment of an amount

accruing to the benefit of a city or town.

Refunding of Debt – Transaction where one bond issue is

redeemed and replaced by a new bond issue under

conditions generally more favorable to the issuer. (See

Current and Advance Refunding of Debt)

Reserve for Abatements and Exemptions – (See Overlay)

Reserve Fund – An amount set aside annually within the

budget of a city (not to exceed 3 percent of the tax levy for

the preceding year) or town (not to exceed 5 percent of the

tax levy for the preceding year) to provide a funding source

for extraordinary or unforeseen expenditures. In a town,

the finance committee can authorize transfers from this

fund for "extraordinary or unforeseen" expenditures. Other

uses of the fund require budgetary transfers by town

meeting. In a city, transfers from this fund may be voted by

the city council upon recommendation of the mayor.

Residential Exemption – A municipality can grant a

residential exemption of a dollar amount that cannot

exceed 20 percent of the average assessed value of all

residential class properties. The exemption reduces, by the

adopted percentage, the taxable valuation of each

residential parcel that is a taxpayer's principal residence.

Granting the exemption raises the residential tax rate and

shifts the residential tax burden from moderately valued

homes to apartments, summer homes and higher valued

homes.

Residential Factor – Adopted by a community annually, this

governs the percentage of the tax levy to be paid by

property owners. A residential factor of “1” will result in the

taxation of all property at the same rate (single tax rate).

Choosing a factor of less than one results in increasing the

share of the levy raised by commercial, industrial and

personal property. Residential property owners will

therefore pay a proportionately lower share of the total

levy.

Retained Earnings – (See Enterprise Funds)

Revaluation – The assessors of each community are

responsible for developing a reasonable and realistic

program to achieve the fair cash valuation of property in

accordance with constitutional and statutory requirements.

Revenue Deficit – The amount by which actual revenues at

year‐end fall short of projected revenues and are

insufficient to fund the amount appropriated. In such a case

and unless otherwise funded, the revenue deficit must be

raised in the following year's tax rate.

Revenues – All monies received by a governmental unit

from any source.

Revolving Fund – Allows a community to raise revenues

from a specific service and use those revenues without

appropriation to support the service. For departmental

revolving funds, MGL Ch. 44 §53E½ stipulates that each

fund must be re‐authorized each year at annual town

meeting or by city council action, and that a limit on the

total amount that may be spent from each fund must be

established at that time. The aggregate of all revolving

funds may not exceed ten percent of the amount raised by

taxation by the city or town in the most recent fiscal year,

and no more than one percent of the amount raised by

taxation may be administered by a single fund. Wages or

salaries for full‐time employees may be paid from the

revolving fund only if the fund is also charged for all

associated fringe benefits.

Schedule A – A statement of revenues, expenditures and

other financing sources, uses, changes in fund balance and

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certain balance sheet account information prepared

annually by the accountant or auditor at the end of the

fiscal year. This report is based on the fund account

numbers and classifications contained in the UMAS manual.

Short‐Term Debt – Outstanding balance, at any given time,

on amounts borrowed with a maturity date of 12 months or

less. (See Note)

Sick Leave Buyback – A community's obligation, under

collective bargaining agreements or personnel board

policies, to compensate retiring employees for the value of

all, or a percentage of, sick time earned, but not used.

Single Audit Act – For any community that expends

$500,000 or more per year in federal grant awards, the

Single Audit Act establishes audit guidelines that reduce to

only one the number of annual audits to be completed to

satisfy the requirements of the various federal agencies

from which grants have been received.

SOL – State Owned Land

Special Assessment – A betterment.

Special Revenue Fund – Funds, established by statute only,

containing revenues that are earmarked for and restricted

to expenditures for specific purposes. Special revenue

funds include receipts reserved for appropriation, revolving

funds, grants from governmental entities, and gifts from

private individuals or organizations.

Stabilization Fund – A fund designed to accumulate

amounts for capital and other future spending purposes,

although it may be appropriated for any lawful purpose

(MGL Ch. 40 §5B). Communities may establish one or more

stabilization funds for different purposes and may

appropriate into them in any year an amount not to exceed

ten percent of the prior year’s tax levy. The total of all

stabilization fund balances shall not exceed ten percent of

the community’s equalized value, and any interest shall be

added to and become a part of the funds. A two‐thirds vote

of town meeting or city council is required to establish,

amend the purpose of, or appropriate money into or from

the stabilization fund. (See DOR IGR 04‐201)

Surplus Revenue – The amount by which cash, accounts

receivable, and other assets exceed liabilities and reserves.

Tailings – Unclaimed municipal funds, or a repository,

referred to as a "tailings account," for the retention, until

eventual disposition, of unclaimed funds in the custody of a

municipality. Tailings might include unclaimed tax refunds,

vendor payments yet to clear, overages on the community's

commitment, etc. (MGL Ch. 200A) (Also known as

Unclaimed Checks)

Tax Increment Financing Exemption (TIF) – In accordance

with MGL Chapter 59 §5(51), a property tax exemption

negotiated between a community and a private developer,

typically implemented over a period up to 20 years, and

intended to encourage industrial/commercial

development. (See DOR IGR 94‐201)

Tax Maps – Used to determine the location of the property,

indicate the size and shape of each parcel, and show its

relation to features that affect value. Maps also provide a

complete inventory of all land parcels, helping to minimize

the problems of omitted parcels and duplication of listing.

Also referred to as assessors' maps.

Tax Rate – The amount of property tax stated in terms of a

unit of the municipal tax base; for example, $14.80 per

$1,000 of assessed valuation of taxable real and personal

property.

Tax Rate Recapitulation Sheet (Recap Sheet) – A document

submitted by a city or town to the DOR in order to set a

property tax rate. The recap sheet shows all estimated

revenues and actual appropriations that affect the property

tax rate. The recap sheet should be submitted to the DOR

by September 1 (in order to issue the first‐half semi‐annual

property tax bills before October 1) or by December 1 (in

order to issue the third quarterly property tax bills before

January 1).

Tax Title (or Tax Taking) – A collection procedure that

secures a city or town's lien on real property and protects

the municipality's right to payment of overdue property

taxes. Otherwise, the lien expires if five years elapse from

the January 1 assessment date and the property has been

transferred to another owner. If amounts remain

outstanding on the property after issuing a demand for

overdue property taxes and after publishing a notice of tax

taking, the collector may take the property for the city or

town. After properly recording the instrument of taking, the

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collector transfers responsibility for collecting the overdue

amounts to the treasurer. After six months, the treasurer

may initiate foreclosure proceedings.

Temporary Debt – Borrowing by a community in the form

of notes and for a term of one year or less. (See Short‐Term

Debt)

Triennial Certification – The Commissioner of Revenue,

through the Bureau of Local Assessment, is required to

review local assessed values every three years and to certify

that they represent full and fair cash value (FFCV). Refer to

MGL Ch. 40 §56 and Ch. 59 §2A(c). Will change through the

Municipal Modernization Act.

Trust Fund – In general, a fund for money donated or

transferred to a municipality with specific instructions on its

use. As custodian of trust funds, the treasurer invests and

expends such funds as stipulated by trust agreements, as

directed by the commissioners of trust funds or by town

meeting. Both principal and interest may be used if the trust

is established as an expendable trust. For non‐ expendable

trust funds, only interest (not principal) may be expended

as directed.

Unassigned Fund Balance – Unassigned fund balance is the

residual classification for the government’s general fund

and includes all spendable amounts not contained in the

other classifications. In other funds, the unassigned

classification should be used only to report a deficit balance

resulting from overspending for specific purposes for which

amounts had been restricted, committed, or assigned.

Unfunded Mandate – A requirement imposed by law,

regulation or order without underlying financial support,

thereby resulting in direct or indirect costs to the body

made responsible for its implementation.

Unfunded OPEB Liability – This is the difference between

the value assigned to the benefits (other than retirement)

already earned by a municipality’s employees and the

assets the local government will have on hand to meet

these obligations. While there is no requirement in

Massachusetts to fund this liability, GASB 45 requires that

the dollar value of the unfunded OBEB liability is

determined every two years. (See GASB; OPEB)

Unfunded Pension Liability – Unfunded pension liability is

the difference between the value assigned to the

retirement benefits already earned by a municipality’s

employees and the assets the local retirement system will

have on hand to meet these obligations. The dollar value of

the unfunded pension liability is redetermined every three

years and is driven by assumptions about interest rates at

which a retirement system's assets will grow and the rate

of future costs of living increases to pensioners.

Uniform Municipal Accounting System (UMAS) – UMAS

succeeds the so‐called Statutory System (STAT) and is

regarded as the professional standard for municipal

accounting in Massachusetts. As a uniform system for local

governments, it conforms to Generally Accepted

Accounting Principles (GAAP), offers increased consistency

in reporting and record keeping, as well as enhanced

comparability of data among cities and towns.

User Charges/Fees – A municipal funding source where

payment is collected from the user of a service to help

defray the cost of providing the service. Note that any

increases in the fees must satisfy the three tests set forth in

the Emerson case. (See Emerson College v. Boston, 391

Mass. 415 (1984))

Valuation (100 percent) – The legal requirement that a

community’s assessed value on property must reflect its

market, or full and fair cash value.

Warrant – An authorization for an action. For example, a

town meeting warrant establishes the matters that may be

acted on by that town meeting. A treasury warrant

authorizes the treasurer to pay specific bills. The assessors’

warrant authorizes the tax collector to collect taxes in the

amount and from the persons listed, respectively.

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