Templeton may need Draconian fiscal cuts

Templeton may need Draconian fiscal cuts

By John J. Monahan TELEGRAM & GAZETTE STAFF
jmonahan@telegram.com

BOSTON — Templeton town officials are considering "devastating" cuts in town operations and services to avoid a possible default on the town's debt linked to a $505,000 budget deficit.

Interim town administrator Robert Markel said Wednesday the severe budget-cutting plan would shut down many town services for two months and include major layoffs in highway, police and fire operations.

"I think these are the deepest cuts that I have ever encountered in 32 years in municipal government and it will devastate town services for six weeks," Mr. Markel said. Because the same structural budget deficit exists between spending and recurring revenue in the coming fiscal year, some of those cuts will continue beyond July 1, he added.

"We may close the library and close the Council on Aging. Highway department activity will close down because we have to furlough the workforce," he said. The plan for the spending cuts is being sent to selectmen for possible adoption Thursday night, he said, and would also include layoffs of police and firefighters in the town of about 8,000 residents.


Selectman Chairman Kenneth C. Robinson said he received the list of the recommended cuts and confirmed they would shut down many town services for six weeks, and force the layoff of half the town's full-time police force. That, he said, could mean the loss of the third police shift.

There would be $10,000 in savings sought from Fire Department layoffs and staff cuts in the town EMS and dispatch for those final six weeks of the fiscal year.

Highway operations, he said, would be shut down and the library would close and lose its state certification for at least a year. Layoffs at the Council on Aging would close down much of its work, although Mr. Robinson said there may be provisions to keep the community food bank at the Council on Aging center open.

Sharp salary cuts across almost all operations would result in layoffs or furloughs of many, if not a majority, of town employees and some layoffs would last beyond July 1, he said. Staff would be reduced in the Board of Health, Selectmen's office, Planning Board, Animal Control, Cemeteries and Parks Department, Recreation Department, and Veterans Affairs.

The cuts, he said, would force many town services to "grind to a halt" if selectmen approve it at their meeting Thursday night. While the cuts are "draconian" Mr. Robinson said "I prefer the cuts to default."

Mr. Markel said the cuts are an alternative to accepting a state loan to close the deficit, which would require the town to submit to state control of local spending for the next five years. The issue with the state loan, he said, is that even if it were obtained at this point, it would not solve a pressing cash flow problem that has developed because the town has been unable to send out tax bills.

The town is prohibited by the state Department of Revenue from sending out tax bills until it can show it has a balanced budget, he said. While estimated tax bills went out the first two quarters, he said, the town cannot set a tax rate and send final official tax bills in time to address what has turned into an urgent cash flow problem that could force a default in June.

"We have in the range of three million in obligations and two million in cash," Mr. Markel said. "The accountant told me he expects we will run out of cash June 13," at which point the town would face possible default on its bond payments.

The current financial crisis follows rejection of a Proposition 2½ override by town voters Tuesday that would have raised taxes to cover the deficit, and several years of accounting problems that failed to address a structural deficit in the town budget.

Mr. Markel said the town had expected to seek the state bailout loan that would be authorized by special legislation on Beacon Hill, if the override was rejected. State Sen. Stephen M. Brewer, D-Barre, said this week that the legislation has been drafted and is ready to be filed, if needed.

But in the last two days Mr. Markel said, town accountants have informed him that the state loan could take weeks to be approved, and until then, the town would not be able to send out already-delayed tax bills for the second half of the current fiscal year.

At this point, he said, the fastest way to balance the budget is to make $505,000 in cuts this week, which would allow the town to send out tax bills and restore its cash flow.

If the town waits for the loan, he said, the cash flow problem would worsen to a point in June where it could be unable to make required bond payments.