BELCHERTOWN — Belchertown received a welcome fiscal surprise when the state’s fiscal year 2027 budget allocated an additional $500,000 of state aid above the predicted amount.
Town Meeting already approved a $62 million budget for fiscal year 2027 in May. This included estimated state aid based on the governor’s budget, which was $19.5 million. However, when the actual state budget came out of conference committee on June 30, the cherry sheet was $502,571 above the governor’s numbers.
“This is not a common occurrence,” Town Accountant Jill Rossi said.
Municipal leadership will suggest where to allocate the money in the next couple weeks before Town Meeting votes on Nov. 9. The school choice funds of $161,675 will go directly to the school department, leaving the Select Board to decide on the remaining $340,896.
At the Tri-Board meeting, the Select Board debated whether to put the money into the stabilization fund or into a capital stabilization fund. Ultimately, the board voted down splitting the money between the two savings accounts 4-1, with the only support coming from Jonathon Ritter. The other four board members all wanted the money to go to future capital projects, particularly the Jabish Brook Middle School roof and windows.
“We never really come across this nice thing that is happening,” Select Board member Nicole Miner said. “So I would like us to focus on capital, because it’s something that really affects all of us at all three tables here.”
Town Manager Steve Williams initially suggested putting the funds into stabilization accounts to increase town savings for the upcoming fiscal years. This additional funding will become a permanent addition to the town’s state aid and be included in next year’s operational budget.
“My goal would be to get the stabilization to a point where it’s not the first consideration we go to when we need money. So we can start looking at spending it on capital and one-time expenses,” he said.
Finance Committee Chair Brian Gibbons agreed with Williams, saying that building up savings will give the town more leeway to use free cash for capital projects or other town needs.
“Otherwise, we’re going to be under a lot of pressure to take all the free cash and put the maximum amount possible into stabilization,” he said.
The Division of Labor Services recommends municipalities have savings roughly equal to between 4% and 7% of their operating budget. Right now, Belchertown’s stabilization fund is at 4.3% of the operating budget.
Select Board member Jen Turner suggests the money go towards capital expenditures because it is operating budget funding. Contributing to the stabilization fund now might deter the town from continuing its trajectory away from investing free cash into general stabilization. The money would also be the first contribution into the capital stabilization fund.
The Capital Improvement Planning Committee met this week to begin compiling a list of capital items for next year’s budget.
However, the School Committee felt this decision would leave out its considerations. Superintendent Brian Cameron said it would contradict the town’s agreement to allocate 70% of state aid to the school department and 30% to other town departments.
“I actually agree with what you’re saying, but you’re just negating an agreement that we had for years,” he said.
Miner noted that the school department gave the town $200,000 in savings from health insurance in order to pay down the rest of Belchertown’s $911,000 mid-year insurance increase. Putting the funding in capital stabilization would give back to the school department and put the town in a better fiscal position.
“I’m not amenable to the 70/30 split, but I am completely amenable to putting all of that money into capital because some of the top items on that capital list are for the schools,” Miner said.
The School Committee will continue this discussion at its Sept. 22 meeting. The Select Board will revisit the matter during its Sept. 28 meeting before giving final approval of the special Town Meeting warrant on Oct. 5.
