The City of Newton, an outstanding city, is strong financially, but we can’t be complacent. I bring the skill set and the perspective to guide Newton as it faces challenges ahead.
- My professional career spans decades in the private and non-profit sectors as a strategic planner. Having earned an MBA at Harvard Business School, I wrote WGBH’s first master plan. Currently, I am Vice Chair of the City Council’s Finance Committee and Chair of the Financial Audit Committee – experiences that afford me an in-depth understanding of Newton’s finances. I am also the author of the 2014 80-page white paper on Newton’s $1B unfunded liability for pensions and retiree health care insurance.
- In addition to the above, I served as the Vice Chair of the Newton Citizen’s Advisory Group and served on the Blue Ribbon Commission. These groups analyzed Newton’s structural deficits and crafted a blueprint to get Newton back on track. Mayor Setti Warren implemented many of our recommendations.
- Strong residential growth and a healthy commercial sector
- A diverse and robust regional economy
- Manageable capital debt levels
- Conservative budgets
- Improving cash reserves
- Operating Challenges: Employees are our most important “assets.” 85% of the school budget and 65% of the municipal budget is compensation. We need to attract terrific people without letting rising healthcare costs crowd out other spending
- Capital Investments: We need to make significant investments in infrastructure – roads, schools (Cabot, Aquinas, Ward, Countryside, Franklin, Williams, etc.), the Senior Center, recreation (Gath pool, Crystal Lake bathhouse, Newton Centre hut, etc.), public safety (two fire stations and the police HQ), open space (Webster Woods), water & sewer & stormwater infrastructure, the library, and Department of Public Works facilities.
- Long-Term Obligations: We owe over $1 billion to our retirees that hasn’t been funded. Read my 80 page white paper on retiree benefits here.
- State and Federal Funding: Pressures on the Commonwealth’s budget and a change in administration in Washington, D.C. may mean less growth in funding or possibly cuts.
- Modest opportunities to increase revenues
- School costs rising and limited opportunities to decrease expenses painlessly
- Municipal costs have only limited opportunities for major cost efficiencies and some areas that require increased funding
- Significant number of capital projects ahead and more funding needed for maintenance efforts
These challenges are apparent in the budget we passed on May 18, 2017. The general fund budget is $395.3 million – only a 2.7% increase over last year’s final budget.
Where’s the money going in our next fiscal year?
- The Newton Public Schools allocation (55.5% of the total budget) is UP by 3.7%, but, even so, saw cuts of 26.6 positions.
- Other city departments (26.9% of the total budget) are DOWN by 2.6%, even with the addition of 13.4 positions.
- Retirement benefits (9.2% of the total budget) are UP by 7.5%. This includes both pensions (up 9.6%) and retiree health care.
- Debt and interest (5.8% of the total budget) are UP by 12.5%.
What’s the way forward?
- As Mayor, I will be transparent and convey my sense of urgency. It is important to openly acknowledge Newton’s financial challenges so all residents know what is at stake.
- I will work with other elected officials, citizens, and employers to plan and to communicate our priorities.
- I will be a Mayor who focuses on spending every dollar wisely and who focuses on effective management and increasing productivity. Increased use of technology will be a major priority.
- I will encourage appropriate revenue growth from our commercial tax base. We need to develop individual master plans for our village centers and commercial corridors to accomplish this.
- I am committed to smart growth and responsible budgeting to grow and diversify our tax base. Debt exclusion and general overrides might have to be considered when new investments are absolutely critical to meet important goals. But, the City has to be on a slope of continuous improvement in productivity and efficiency; otherwise, we will continuously need additional tax increases.
- I will invest in preventive maintenance and capital investments, and prioritize capital spending to make sure we stay financially sound.
- I will work with our unions, retirees, employees, elected officials, and residents to develop a fair and financially sustainable plan for paying retiree benefits, a significant challenge. We have made a promise to our current retirees that we need to keep.
To ensure the continued health and sustainability of our city for decades to come, I will bring a strategic perspective. We have scores of initiatives before us to promote the continued vitality and attractiveness of Newton. To ensure these ambitions do not evolve into unchecked expectations, we have to plan strategically.
We need a long term financial plan that quantifies the implications of our qualitative aspirations. If compensation, retiree benefits and/or infrastructure investments increase faster than revenues, then choices will need to be made, hard ones. But with careful analysis and thoughtful deliberations, we can make prudent decisions. We can take actions that will better position the City of Newton to sustain its success and fulfill its mission of being a great place to raise a family, to work and to play, and to retire.
Note: I have used documents created by and for the City of Newton, sometimes word-for-word, when writing this position paper.