Shortfall still $505K after state's visit

Shortfall still $505K after state's visit

Eryn Dion
News Staff Writer

TEMPLETON — Representatives for the state Department of Revenue recently met with the town’s financial management team for several hours in order to take a closer look at the town’s debt — offering officials a rare glimmer of good news.

Last week, Town Administrator Bob Markel reported that the state was concerned about the amount of the town’s budget shortfall,   stating it might be $585,000, as opposed to the $505,000 previously estimated. After reviewing information presented by Templeton’s acting accountant, DOR representative Matt Angel did not find any discrepancies and the budget gap ultimately remained unchanged.

“They were convinced and said to me at the end of the day, that they believe the shortfall this year is $505,000,” said Mr. Markel. “We don’t have to worry about another $70,000 or $80,000 tacked on to that.”


The department reviewed debt issues dating back to 2004, cross-referencing them with town meeting votes and asking questions to ensure all debt was reported correctly. Mr. Angel will be creating a debt schedule to be posted on the town’s website, which will outline all the borrowing undertaken by Templeton and projected future payments.

Also under the state’s microscope, is the proposed 5 percent municipal budget cuts to be enacted during the Special Town Meeting within this year’s Annual Town Meeting — which will amount to an estimated $150,000 reduction across the board.

“They wanted to make sure that those cuts are real, that the monies are available and that we go ahead with the deductions,” Mr. Markel explained. 

Should voters reject the Proposition 2 1/2 tax override, and the revenue department submit special legislation to allow the town to operate in a deficit, the state would likely be unwilling to loan the full $505,000 and would expect the town to contribute some of the funding in the form of budget cuts and other efficiency measures. Mr. Markel said the threat of state control is very real, as the revenue department has been preparing the deficit legislation and has already outlined to officials their course of action.

The state representatives said Monday that the department would not send a control board or an overseer — like they have in other communities — but that the town would be placed in a financial straitjacket. All expenditures and significant activities in town would first need to be approved by officials in Boston.

Mr. Markel reiterated that, while state control may seem “superficially attractive” to some residents, it comes with a number of decidedly unattractive consequences — including a negative impact on the services provided by the town, reputation, ability to attract talented employees and property values.

The shortfall figure has temporarily fluctuated over the past few months, with the state claiming in separate instances the $505,000 figure to be greater or less than what was estimated. Residents were understandably concerned that there might be a bigger shortfall lurking in the books, however, Mr. Markel assured there were no more surprises and the $505,000 figure was final.

“It’s over,” he said. “No one’s going to find anything more.”

If the override passes at the May 5 Town Election, the board will hold a tax classification meeting the following day to set the tax rate and have it sent to the state for approval. Mr. Markel expected tax bills to go out around May 11 or May 12 — allowing the town to collect some tax income in time to cover the $2.6 million loan taken out in January in anticipation of revenue.

If that cash flow fails to materialize before the loan’s June 30 due date, Mr. Markel said the town will need to use every resource available, including tapping enterprise funds.

“We’re really down to no good options if that happens,” Mr. Markel said. Overall, Mr. Markel described Monday’s meeting as positive — saying the state has been very cooperative and is going out of their way to help Templeton through its budget crisis.