Aldermen Approve Transfers from Free Cash for the Budget

July 18, 2013
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The Board of Aldermen voted 6-0 on two recommendations by City Auditor Richard Viscay Monday night to appropriate a total of $1,028,219 from the budgetary fund balance, also known as Free Cash, so that the city could use the money on anticipated expenses, without having for the free cash amount to be re-certified for FY 2015.

The first and largest appropriation was to put $789,099 in the city’s stabilization account, in anticipation of the city needing to increase it’s share to fund the school budget, after the state legislature decreased the amount that will be awarded to the city in Chapter 70 education funding by approximately $2.8 million.

According to Viscay, the School Department has built its budget based on the Chapter 70 figure that was first proposed by Governor Deval Patrick in January. However, the legislature’s conference committee between the House and Senate resulted in a lower Chapter 70 funding level, which could impact Everett by a loss of some $2.8 million.

Though the final budget has not been passed, and therefore the final chapter 70 amount is not yet known, Viscay said that it is not likely that the final budget will restore all of that $2.8 million.

“What is probably going to happen is that the city will be required to increase our share to the schools and the schools will probably have to meet and reduce their budget to help make up the difference,” explained Viscay. “In the meantime, I think it makes sense to just park this funding ($789,099) in the stabilization account, so we can access it when we know what our new payment to the schools will be.”

The aldermen agreed and the nearly $800,000 transfer went through with no debate.

The second vote was to transfer $239,120 from Free Cash to the Solid Waste Disposal account, so the city can purchase new recycle bins from the Recycle Bank in support of the city’s new single-stream recycling program.