BRATTLEBORO — For the past few years, Town Manager Peter B. Elwell has worked to steer the Selectboard away from putting out proverbial fiscal fires and toward preventing emergencies in the first place.
Small municipalities too often replace important town vehicles and infrastructure only after they've failed or have come close to it, or fixing buildings only after they've begun to crumble.
This budget season, Elwell and his staff continue that effort with their short-term goals - recommendations for the fiscal year 2020 budget - and longer-term planning.
The gist of Elwell's message: set aside money now for such projects, and instead of paying interest on a loan, earn interest on savings for anticipated equipment - especially for expensive firefighting apparatus.
Elwell presented two of the annual budget's heavier sections - those covering capital equipment and capital projects - at the Nov. 20 regular Selectboard meeting, along with a long-range plan for paying for some of the town's major infrastructure needs.
Before jumping into the numbers, Elwell gave a brief history lesson.
For the last several years, Town Manager staff and the Selectboard, with the support of Representative Town Meeting and the Finance Committee, have recognized that “we need more funding to capital for both the replacement of equipment in a more timely manner, and to the investment in our infrastructure,” said Elwell.
Four years ago, the town began setting aside $350,000 annually. Now, Elwell wants $1 million for capital funding to help the town's municipal staff take better care of equipment and projects. Those funds will also free up the fund balance from the previous year's surplus to meet other municipal needs.
Regarding the multi-year goal of $1 million: “This is the year we've arrived there,” said Elwell.
But this is just the beginning. It's clear, he said, that “we will consistently need more than $1 million in capital in order to keep up with our needs.”
A 25-year plan
Town Manager staff began addressing those needs by first figuring out exactly what they are. They collected information on the town's equipment, its condition and age, and came up with a 25-year equipment-repair-and-replacement schedule, complete with estimated costs.
It covers “every single item that we expect to replace in the future,” said Elwell, from police patrol vehicles - they last only about five years - to the Nelson Withington Skating Facility's Zamboni ice-grooming machine, which is “very old.”
Elwell admitted that sometimes things don't always exactly go according to plan, but this schedule will give the Selectboard, Representative Town Meeting members, Town Manager staff, department directors, and the public a good start on what to expect from the town's aerial ladder firetrucks, dump trucks, sidewalk snowplows, and other pieces of equipment.
As part of the ongoing process, every year, during budget season, the Selectboard can revisit and reassess the list, its contents, and associated costs.
Saving up for a fire engine
One new component to the capital-needs budget Elwell is proposing is a fire-engine-replacement fund, which would start with $5,000 for FY20, then $8,000 annually.
Elwell pointed out just one example of how business-as-usual has affected town governance and the tax rate.
Starting with the FY20 budget, Elwell said, “we are incurring an additional $60,000 in cost this year, and for the next 10 years,” to pay for an aerial ladder truck for the Fire Department.
The $950,000 vehicle was approved by the Selectboard and Representative Town Meeting in early 2018 after lengthy debate.
Elwell pointed out that $10,000 of this annual payment is interest, which means that over the 10-year loan, taxpayers will dish out in $100,000 in interest alone.
“What we're proposing with the fire replacement fund is to turn that on its head,” said Elwell.
Instead of “wild spikes up and down” in funding for fire department apparatus, which affects the tax rate, this program “actually accrues interest on money we're saving up to buy fire engines,” said Elwell.
If this proposal passes, and future Selectboards and Representative Town Meeting members continue to approve annual appropriations for the fund, the town can save up just over $500,000 over a 25-year period, calculated on a 3-percent interest rate, “which we think is conservative,” said Elwell.
This, coincidentally, is roughly the amount that the town recently borrowed for the new aerial ladder truck.
“We've experienced in the last few years as a community what happens when in a four- or five-year period: we have to replace three or four fire engines,” said Elwell.
These trucks, he noted, are by far the most expensive vehicles in the town's fleet, and replacing them is a big expense “that crowds out other capital needs in that particular year.”
And over consecutive years, a cycle of neglect develops because the town cannot afford to make repairs on or purchases of other items, so “things fall apart,” said Elwell.
“It requires that kind of foresight and commitment as a community to sustain a plan like this,” he said, adding, “We need to be willing to commit our annual increments for some things that some of us may not see” during one's tenure or even lifetime.
Selectboard Chair Kate O'Connor noted there's no enforcement mechanism for a change in spending strategy that requires a discipline and commitment over decades.
A future Selectboard or Representative Town Meeting might also reverse this decision, should the current bodies approve it.
But, she pointed out, board members now have the opportunity to change the culture.
Elwell agreed, noting that he seeks community engagement and guidance on this new approach, which he described as “substantively different” from the way the town has handled past capital replacements and repairs.
He said Town Manager staff agrees that $8,000 per year in increased cost over time “is a sustainable way” to fund the fire department's needs and other capital projects.
“We won't have to buy a new dump truck because it's failed,” said Elwell. “We buy it just because it's getting old and needs to be replaced.”