Town of Swampscott Financial Forecast Fiscal Years 2015

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Town of Swampscott Financial Forecast Fiscal
Years 2015 2019

• Tom Younger
• Town Administrator
• November 6, 2013

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Budget Pressures

• Any Economic Recovery Underway is Not Yet
  Providing Relief for the Towns Budget
• The Chronic State Budget Crisis Continues to
  Impact Chapter 70 Revenues
• The Town is Controlling Discretionary Spending,
  However some Non-Discretionary Spending, Like
  Health Insurance and Pension Costs, Continue to
  Rise Beyond Inflation
• Creating a Viable Long-Term Capital Plan with
  Funds Available
• Plan for Funding OPEB (GASB 45) Prior to Being
  Mandated
• We Must Continue the Commitment to Increase our
  Reserves to Best Practice Levels while
  Eliminating our Reliance on One-Time Revenues or
  We will Jeopardize the Towns Bond Rating and
  Cost of Capital.

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Five Year Financial ForecastPro Forma
Assumptions - General Fund Revenues

• State Aid is Projected to remain level in FY15
  With a 2 Increase in FY2016 Through FY2019
• Tax Levy and Levy Limit will Grow Approximately
  by 2-3 Through FY2019
• Charges, Licenses, Fees and Miscellaneous Revenue
  Projected to Increase in FY2015 due to some major
  projects in town
• Reduce the Use of Free Cash to only pay for
  one-time costs. Additional Amounts May Need to be
  Used to Fund the Towns Rainy Day Fund
• Nahant Tuition is Expected to be 1,336,046 for
  FY15
• Other Sources of Revenue Include Enterprise Fund
  Indirects (802,000).

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Five Year Financial ForecastPro Forma
Assumptions - General Fund Expenses

• Salaries and Operating Expenses (Including
  Schools) Projected to Increase 3 for FY15
  through FY19
• Health Insurance Costs Projected to Increase by
  5 in FY2015 and FY16 and Increase By 10
  Annually through FY2019 Based on the Presumed
  Cost to Implement the Affordable Health Care Bill
  Adopted by Congress in 2010
• Due to the Funding Schedule Adopted by the
  Retirement Board, the Retirement Appropriation is
  Expected to Increase by 4 in FY2015 and 5 Each
  Year Thereafter
• State and County Charges and Cherry Sheet Offsets
  are Expected to Increase 2.5 Each Fiscal Year
• Debt Service Based Upon Current and Future
  Capital Improvement Programs
• The Lynn Sewer Connection was paid off in FY14.

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Five Year Financial ForecastRevenue and
Expenditure Summary General Fund
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Net State Aid ComparisonFY2005-FY2014
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Changing Enrollment Analysis
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Revenue Allocationby Percentage
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Where do we go from here?

• Increase Town Reserves
• Stabilization Fund
• Capital Stabilization Fund
• OPEB Trust Fund
• Continue General Government/School Consolidation
  Discussions for Improving Service Delivery
• Dont Rush to Spend!!!