Quasi Committee of the Whole - Budget Hearings — May 21, 2026

All right.

Good evening, ladies and gentlemen.

And welcome to our first budget hearing for the fiscal year 2027 budget.

Um, note, like all city council meetings, that this meeting is being live streamed and recorded.

City council and committee meetings can be viewed on the City of New Bedford's homepage under Quick Links, then Meetings.

All right, so at this time I am going to, uh, have our CFO come up, Bob Ekstrom, and give a little presentation and overview, um, of our budget.

But, uh, before that, I just wanted to, uh, to my colleagues, my new colleagues and, uh, those, uh, older colleagues, uh, uh, councilors, uh, that, uh, the finance team does a great job at, um, getting turnarounds to our questions asked here in these meetings.

So I thank them, we all thank them for their speedy work working with our department heads.

Superintendent O'Leary is here and very happy to work with all of them and get those turnarounds quick on question answers to our questions.

So I thank them for, for that.

Sharon and Bob, thank you guys.

So I'll call up Bob at this time.

Good evening, councilors, and welcome to 2027.

I guess I'll be the first one to, uh, to wish you a good new year here about 6 months earlier from the real thing.

It's the nature of this job though.

You, uh, we just get finished with fiscal '25 and we're starting fiscal '27's budget.

I'm really in '26, and sometimes I forget that.

But, uh, as you can gather, this is, uh, this has been a bit of a challenging spring.

Uh, you've, uh, you've heard some of the, uh, you've heard the mayor speak, uh, about a starting balance which is probably the greatest gap that I've seen in my 12 to 14 years here.

Uh, we started off with about $32.5 million.

Starting gap of $32,492,000.

The mayor had alluded to this, uh, in his presentation last week.

Uh, the highest I've ever seen before was about $12 million.

However, I think that was back in the Ari days, and he may have not counted some of the requisition— some of the requests that departments submit for enhancements, such as for new programs, new initiatives.

And I did include that because it's all It's all on the table for us to consider.

So obviously, uh, we're not— the state law requires us to produce a balanced budget to you.

So to get from $32,492,000 down to a balanced budget took a little bit of work this year, as you can gather.

So first of all, we, uh, we had to pretty much decline any requests from, from our department heads anything new this year other than their existing baseline budgets.

I'll tell you briefly what baseline means.

Okay, baseline means all your existing personnel, but they get any kind of COLA increases or step increases that they were deserving under Unit C provisions or under their own collective bargaining agreements.

It also includes any kind of contractual increases— same services, higher prices.

Solid waste is a good example.

The capital waste services had increased prices in years 2 and in year 3.

That is a baseline cost.

That increase from year 2 to year 3 is baseline.

Other than that, we had to eliminate, as you can see, 7— excuse me for just— $7.5 million.

That's a lot of nos to have to tell our department heads who worked quite tirelessly themselves in trying to put together these plans.

Now, part of that is— part of that no is, is no, not right now, because $2.9, almost $3 million of that is capital needs.

And for some time now, for 3 years, we've been pushing all of the capital requests off to the CIP program.

We, we took funding of capital improvements out of the budget or when I first came back as CFO.

The only exceptions that you see in your budgets now are for small reserves for like, for instance, for IT.

They don't know when machinery's gonna break.

They have to put a new server in, something goes wrong, something like that.

So we had DPI, fire, police, DFFM, IT have small reserves for capital.

And we're also getting rid of the last of the old lease purchase arrangements.

That, uh, that we used to use quite frequently for our— for, uh, for purchasing vehicles.

It's a tool that I do not like very much.

Uh, it comes with a very high implicit interest rate.

So what we did was we pushed all the vehicle purchases in NOVA to the CIP now.

So bonding it in the CIP is in the range of— depending on how long we go out, it's in the range of about 4%, which is about half as much as we're looking to pay in lease purchases.

So after all those nos, we had, uh, some back and forth with the school department.

We've made an adjustment to the school budget once again this year, $4.5, almost $4.6 million, and I'll explain that a little bit more later.

But basically it comes down to 2 line items.

One is under the net school spending formula for Chapter 70, and the second one is for other net school spending expenditures that are not eligible under the net school spending formula.

Finally, you're going to see later on— I'm going to show you the individual actions that we took— but the city administration, department heads, we all got together.

We met several times.

In fact, 7 councilors were involved in some of our meetings where we presented some of our findings to date, and we eliminated $7.7 million from existing baseline budgets on top of all the other cuts, saying no to, to, um, to the, uh, any enhancement requests and the $4.6 million to the school.

We said no to $7.7 million in city costs as well.

Uh, so this final number gets us down to a, to a, to a levy that— I apologize, that second arrowed bullet, that $12,728,000 is actually net.

The actual tax increase was higher than that.

But we eliminated some of our so-called one-time funding.

Last year we used— we had to use some free cash as a source of revenue to, to balance the budget.

That's been taken out.

So the net effect of the tax increase this year less the reduction of the one-time money is the final difference of $12.7 million.

Uh, it's no secret that we've— we're in the midst of a basically a structural deficit right now.

We have revenues that are growing far smaller than expenditures are, and it's been that way for some time.

It's kind of coming home to roost more and more now.

You'll see later on in this presentation that we've had to rely on a lot of one-time sources of revenue to keep the budget balanced over the last 3 or 4 years.

This gap right now was very, very premature since we're talking about 2027.

But as it stands right now, if the budget is passed the way it is, we will have another problem next year and the year after.

Right now, very rough estimates on my part call for a $10 million gap in 2028 and a $28 million gap in— I'm sorry, an $18 million gap in 2029.

That compares to the $32 million though, so we're sort of better off.

The optimist in me will say we we have some time to fix that problem, and it's not as big as the one we started with this year.

So I'd like to begin, uh, 2027 by taking a quick, uh, recap of where we left 2026 off.

So I break this down only just to keep things sort of simple.

I break it down into school and city.

Uh, you can see we, we, uh, had an adopted budget of $492 million last year.

We asked for We proposed $498 million, but council cuts were, as you can see down below, $7,948,000 were the council cuts.

So that brought us to the actual adopted budget of $492 million.

However, we went back and had to restate that budget for $5.7 million in supplemental budget requests.

This happened, I think, at 3 different points.

In the year.

Most of that was with school, and the biggest reason there is because we made the adjustments to the school department last year, waiting to see what the net school spending formula would work out to be.

As you know, as you recall, Governor Healey had imposed a cut to— I think it was the charter school tuition reimbursements, and that, that cut was vetoed.

I think it came about sometime around December or January.

We came back to you with a third wave of of supplemental requests to reinstall that.

In that particular case, it was $1.4 million.

So all in all, we put $5 million back into the school department through the supplemental budget process and another $745,000 in city.

And I can tell you that's the $495,000 for the Zytarian and $250,000 for the Parallel Products litigation.

Those are those 2, the supplements.

Additionally We funded, uh, the 2026 budget with $4.5 million of free cash and stabilization transfers.

Now these are what we call— these are what we refer to with the one-time spending.

That's— we're taking out of fund balance and using it to cover our 2026 budget.

The reason is that that was a gap that never got filled.

It's almost like taking out of your IRA account to pay for some of your personal expenses, ongoing personal expenses.

Something I don't like to do, it's not prudent to do it, but we were forced to do that because we needed to.

There were cuts, there were cuts that were made that we had to reinstate.

The biggest line item in that $4 million is the $1.1 million to police salaries, but I think I have an itemization of all of them later on in this slide.

So the reason I highlighted that $502 million, that's really my compare-to basis right now, because again, we, we got $492 million adopted, $5.8 million was supplemented to that adoption, and we needed to add another $4.5 million.

This is just a quick recap of Taking a look at where we were in 2026, what is new in 2027?

So I did this on a very high level.

We had school department requests of, uh, $23— that, uh, an increase of $23.2 million.

That would, that would represent, uh, that would represent, uh, to the school department folks here back to their original budget of $267 million that they presented to the school committee.

And another $20-some-odd million for, uh, non-school— net school spending eligible costs.

So that their total package was $289 million, and that would represent the $23 million increase.

Plus we also allocate the Cherry Sheet assessments that relate to education, that's for school sending and for charter school, uh, assessments as well.

So the school, uh, increases were $25.3 million.

There's also another line item for school debt.

I called that out separately.

School debt is not allocable to the school department, but I called it out because I use it in my own distribution of school versus city costs, because this is debt that relates specifically to school projects.

The reason why it's not allocable to the school, however, is that DESE takes the, takes, takes the stance that school property belongs to the city.

So it's, uh, it's, it's, uh, it's our buildings to keep repairs on.

So we cannot charge in any way, shape, or form that back to the school, but it is a line item that did increase, and therefore it makes this slide.

Other salary step increases that, that were earned during the year, uh, or that would have been— that are planned to be earned during the year— are $1 million.

We have a COLA base increase of $528,000.

Um, for, um, I'm sorry, I'm jumping the gun here.

The, um, $528,000 are for the step increases, the, uh, for the existing contracts rather.

Uh, pension assessment went up $3.7 million.

This is no surprise.

We have a very aggressive pension funding schedule to go to between now and 2035.

That 2035 is up for discussion.

I already had some discussions with, uh, Councilor Pereira amongst others and Eric Cohen at the Retirement Board.

We, we're going to present some ideas after 2027 on what we can do to lower those costs.

I must point out though that the assessment is, is already in place.

PEREC assesses us based on the 2024 valuation, so that's a locked number this year.

$3.7 million it is.

Nothing we can do about that.

Health insurance increases, $4.5 million.

Uh, then I, I lined item these, these items: vehicle fuel and utilities.

That's a small increase, but I'm going to show you why I put this down in a minute, because the real costs that we've had to add to the budget are much higher since the original budget was requested from department heads.

Waste collection, that $280,000, that represented DFFM's best guess of where waste contract bids would come in.

It represents a 3% increase over capital's, um, third year.

I believe that was just keeping pace with their first 2 years.

They called for 3% increases, so they carried that forward.

Uh, what we did eliminate was, uh, that should— I'm sorry, that should say OPEB.

We had subsidies for OPEB, uh, subsidies for enterprise funds, and a $250,000 payment that we were making out of our general— out of our budget to go towards our OPEB funding, in addition to the 10% that we set aside in free cash.

We had to eliminate those this year.

And the only real other cut that's worth noting is Zytarian.

That contract went down.

It was $495,000 a year for the first 2 years, and then it's $395,000 for the remaining— I believe it's 5 years.

So that's the only true cost reduction we were seeing, you know, other than small things.

Additional increases that happened after the budget request came in.

So fiscal '26, as I had said back in last year and I will point out again this year, fiscal '26 did not include anything other than de minimis reserves for our 3 big union settlements— AFSCME Unit A, police and fire.

It's never been the city's practice to budget what we think those contracts are going to settle in for because that becomes public information, and we don't know— to tell you the truth, we wouldn't know how those negotiations are going to go on until we go through the ultimate final agreement with AFSCME.

But we have JLMC hearings coming up for police and fire.

So what happened this year is with no other— there was no nothing in for AFSCME increases, STEP or COLA.

So we settled with AFSCME, I think in April, and, uh, we put before you a council order asking for funding for that contract, which you approved.

This is the second year of that contract.

It's $953,000.

So that's a complete add-on to anything we had in 2026.

Okay, utilities, electric and natural gas.

Those numbers I showed you were before, they were only 60— I think it was $63,000, $69,000, $70,000.

This is because we got— the energy office came in with their new estimates of electricity costs for the year and we saw substantial increases at what Tyler was projecting in each of the buildings in the city.

And along the same lines, vehicle fuel is going up by $395,000.

That increase is solely because of the Iranian conflict.

Our gas and diesel prices went up by $1 to $1.25 literally in a 2-week period from late February to mid-March last year.

So we jumped on that and got our budgets increased to show the rates that were in effect as of March.

Now, if the crisis resolves itself, prices come back down as we all hope they will, there'll be savings there.

But right now, we did not assume that that was going to happen.

We assumed the best information we had at hand at the time, and that was the current pricing that we're getting from our suppliers.

Waste collection and disposal.

This was a killer, quite frankly.

I got very nervous when Fall River opened their bids 2 weeks before we did.

And they had, they had the same players bid on their contracts, and suddenly we're looking at rates in the neighborhood of $15 million.

That's what Fall River had, had come up with.

Well, fortunately, because we have our own facilities at Crable Hill, our cost's a little bit lower, but the winning, apparent winning bid right now is at $13.2 million next year.

And we had— we paid $9.3 million this year.

That's— that minus, uh, that $280,000 I showed in the last slide has to be added with this $3.4.

We have a $4 million increase just from solid waste.

Fire watch was something we had to add as well.

This, uh, this is the, um— this is a fire watch that we've had at, um, at the Neves property down by the railroad tracks, we have to have a fire watch for 24 hours a day for the full year.

Now, we've— we're able to make some cuts on that later on.

We're making some assumptions that the watch will not have to continue all year.

But the facility— the EPA has to finish its cleanup and the site has to be secured.

And we'll— we might have some solutions to that.

But that $517,000 represents an officer and a lieutenant with coverage for 24/7, 365 next year at detail rates.

Uh, finally, all other expenses— we can go over those as each department comes up— all other expenses added up to $728,000.

There are numerous across all departments, so I didn't take the time to itemize them.

So what we've done now, we started at $502 million, we had baseline increases that we just talked about at $37 million.

I just talked about the, the extra $6.9 million we had to add on.

This is where we went to work, try to come up with, uh, a way to get the budget balanced.

So there again is the $4.557 million that I talked about at the beginning of this presentation.

$2.5 million is in net school spending eligible, and a $2 million placeholder for now for non-eligible expenditures.

Now the biggest one is transportation.

We're not saying that the school should cut their budget by $2 million.

We've got a placeholder in.

I've been talking with David at the school department about other— about comparables with other communities to see if there is room to move on transportation.

But in the meantime This is going to— this, I anticipate a lot of this is going to be given back to the schools through a supplemental budget once the final budget— once the final state budget is enacted.

Our goal is to hit net school spending as close to 100% as possible.

This is the second year we've done it this way, and no, it hasn't been done that way in the past.

We take— we sort of call the end to this process once the, uh, either the House or the Senate versions of Cherry Sheet 8 come out, but any changes to Cherry Sheet 8 or assessments affect the amount that we have to give the school department because that's part of the net school spending formula.

Some of the other cuts, you've heard about most of these by now.

Unit C COLA, $555,000.

Unit C step increases, no step increases from July 1st, '26 to June 30th, '27.

That's the period of time that that covers.

That's 454,000.

The AFSCME positions, AFSCME and Unit C positions that have been eliminated, that again on my first slide I pointed up, there's 94 positions in total.

58 were vacancies, 36 are other reductions, reductions to positions where there's an incumbent in them.

Those include AFSCME Unit C, fire, and police.

So I broke them out for each separate line item.

The AFSCME piece is a million— is, uh, $2 million.

The fire company, uh, that the mayor had alluded to last week, $1.4 million.

Now I know $1.8 million was said.

Uh, the reason that that $1.4 million is this is because the other piece of the puzzle is the amount of savings for health insurance.

That I showed as a separate line item.

It's the same $1.8 million that you've heard, but it's just showing up as $1.4 here and as, um, as part of the $523,000 down below.

Uh, the, the police reductions— police have 24 vacancies right now, and all of those vacancies would take them down to 232 sworn officers from the complement they have now.

Which is 256.

So that just includes not filling any of those vacancies.

Therefore, there's no health savings associated with that action.

And finally, the HHS consolidation.

5 departments are being rolled into Health and Human Services, which, as I've been told by Sharon, who used to be an acting director of the old department, that that was an active department in the city as much as about 10, 15 years ago.

So what comes around goes around.

But that savings produced almost $1 million.

The— I showed you the health benefit line item separately.

This reason— this is obviously a giveback.

The 36 reduction in force is going to translate into unemployment benefits of $772,000.

So that's been factored in.

And all the other reductions that we've made, there's a, there's a long list of them.

Um, they, they're not small.

They all start around $10,000.

But that's— I don't have that with me now, but I do have that, uh, I can produce that list for you if you wish to see that.

So where we're at is a proposed budget of $535 million.

That represents a 6.5% increase over the comparable base of $502 million.

As you can see here, the— with the school department, I have $328 million.

I, I footnoted it all through this presentation so far.

Those are direct school costs, right?

Those are— that's the $289 million the school, uh, had put together on their school committee budget.

Plus it is an assessment for Vo-Tech, which is something that we pick up here as well, and also the Chapter 70 assessments as well.

What it doesn't include at this point are the indirect allocations for pension and for, um, and for administrative costs.

And also, as I carved it out separately on this line item, we can't allocate debt to the school department But for purposes of the pie charts that I've been using and the mayor has presented, we put the school piece of debt into those numbers to show that it's a school-oriented— a school-originated cost.

Quick look at where we stand on that $535 million.

And this is a chart that the— this is pretty much the exact chart that the mayor had used, except that I made— I picked up a fourth sub-slice here where the previous version only had 3.

School representing school and other educational costs representing almost 2/3 of the budget.

All of these others are pretty much locked.

We talked about the pension, that can't change, that assessment is already in the books.

Health insurance that we have budgeted, which is $24 million, that is, uh, every active— that is the current roster of enrolled— of employees and retirees enrolled in the various plans that they're enrolled in.

At the premiums that are in existence right now, plus a 10% increase that we're assuming is going to happen on January 1st.

So that does not have any growth in it at all for new positions, since there are new positions in this budget.

We don't do that.

When we budget health insurance, we always budget it with the existing enrollments as of just before this budget, which is March 31st.

So that is a— and I might point out that the old way we used to do health insurance was to allocate actual medical bills.

We got off of that system, as did most of the rest of the state, some time ago.

We use the premium basis or the working rates basis.

So 25% comes out of an employee's paycheck, 75% match from the employer.

It is that 75% match that adds up to $24.4 million that we have budgeted for health insurance this year.

So there is no real— other than the increase that's going to happen on January 1st, there's no— it's pretty much a locked number.

This is the existing people with existing rates.

This slice here is just various things that that are mandated or not discretionary, but it's kind of lumped in altogether.

Debt service for the city, insurance payments— that would include general insurance and life insurance— and other assessments too.

We get assessed from the state as well as the school does.

So our assessment piece is about $2 million.

And finally, a big slice of it is waste collection now.

This— the last quadrant here, not even a quadrant really, it's only about 20%— represents traditional department expenses.

We broke it out into public safety and all other general government.

So you can see we really only have, uh, 17.8%.

That's a little bit— that's roughly about 1/6 of our entire budget is, is housed in departmental requests.

Just another— just a quick recap of the numbers that drive this pie chart.

You see the 65.9% from school and the municipal represents the balance for 100%.

We— I compare it to how we were last year at this time, and it shows an overall increase this year of 6.5%.

I took that pie chart here and just built it into a stacked table so we can compare it to the costs that have, uh, that we've been incurring over the last 3 years.

And you can see it's been slightly, uh, slight increases in each of the categories here as the budget has built up, but the composition has stayed mostly the same except non-discretionary now has been picking up.

And that's because of the increases to debt service with the bonds that we've been issuing over the last couple of years and the pension assessment.

So more and more of our stack is being composed of the green area here, which is non-discretionary, and hence it's creating a lot of the problems that we face now.

Uh, before I go here, what I did was I— this is 2027, and I show you percentage-wise the same.

This is the exact same stack, but I show it to you as a percentage over 2026.

So the point of doing this is that our effective increase is almost 7.7%.

So in other words, if you have 65.9% of your costs which are in school and they're going up by, uh, by 7.6%.

That's 5.1, uh, 5.0, and you add them all up, the effective rate is 7.7.

What I'm saying here is that it would take an overall increase of revenue of 7.7% to make the fund, the general fund, balance.

I, I'm sorry, this is a little bit busy, but I thought it'd be nice somewhere in this deck to put in actual summary of the budget book that you've seen.

Again, it goes over the same numbers.

Uh, your $535 million is the proposed budget this year compared to the, to the revised budget with supplements included of last year, $502 million.

$32 million increase, 6.5% growth.

Here are the funding sources that we're looking at.

The one thing about, uh, the The foundation budget has been going up around 6.6, 6.7% every year, but the nice thing too is that the Cherry Sheet revenue to fund that— a good chunk of that budget goes up by 6.7% as well.

So the problem— the difference, which is the local share, which is actually computed through— by DESE, but it involves— basically involves enrollment by by class and involves certain kind of demographic and socioeconomic factors as well.

So this year, for instance, on the 4th Wednesday of January, DESE came out and said the city has to spend $314 million on education.

Last year it was $295 million.

So that's a 6.6% increase.

They gave us revenues to fund the difference and leave us with the local share piece.

That local share piece is $40 or $50 million before you get to the NSS ineligible expenses, which are predominantly transportation.

The municipal share, not so good.

The mayor has talked about this.

I've talked about this quite some time.

We don't get much.

The biggest component of municipal aid is the unrestricted general government aid.

And I will show you the same slide that I have showed people the last 2 or 3 years, and the mayor's also showed it quite a bit too, just that this— the UGGA has not kept up with inflation.

It hasn't— it just, just now has recovered to its 2010 high before it broke down.

And it used to be the, uh, the lottery aid, uh, they changed that whole formula around, and they, uh, and they— when they enacted 9C cuts back in 2010 or so, and we're just catching up now.

So only now getting the same dollar— dollars for UGGA that we got 15, 16 years ago.

Just a brief note on each of the revenue items, and I just mentioned this already.

Chapter 78 went up by $277 million.

When you take all of the pieces of the education component, which is the net— which includes net school spending, ineligibles, and the regional assessments, We're left with a delta of $76 million.

This has to be covered in our property tax base.

So our overall base is, uh, $170 million.

So about $75, $76 million is due to covering the net— the local share of education costs, plus other assessments, plus the non— the net school spending ineligibles.

Municipal aid, by contrast, went up by only 3 point $31 million.

Local receipts, uh, this is an opportunity, I hope.

Uh, we had not seen much growth in local receipts this year by the time we had to cut off for this budget.

So consequently, there's only a 1% overall increase in, in local receipts.

That's what we assume based on what we do is we do a trailing 12-month look back at local receipts and we see how it's, how it compared to, uh, we set the budget up at that, at that, using those trailing 12 months.

Uh, the Division of Local Services looks at this quite closely.

We can't estimate local receipts that are higher than our most recent 12-month trailing 12-month period when we go in and have our tax rates set.

So we have to assume zero growth here.

The reason why we have the 1.1 1% end is because the current 12— trailing 12 months suggests that we're about 1% over.

The extra 0.2% we are proposing as part of the solid waste contract, we are proposing an increase in mattress pickup fees.

So that brings the effective increase up to 1.2%.

And indirect costs, these are pretty much the result of the enterprise fund budgets.

This is the enterprise fund share of indirect costs that that, uh, that the city incurs on its behalf.

And this is that slide I was referring to, uh, $12.6 million delta between what we do get in unrestricted general government aid and what we would have gotten had we kept pace with 2009's— the pre-9C cut aid plus the, uh, an increase for CPI-U each year since then.

We could have been at $42 million, uh, but we're at $29.4.

Just taking a quick look at, uh, this— the one thing I want to point out with this slide, it's, it's, it's in part to show the piece of our budget we fund through property taxes, but the, the bigger emphasis here is this red slice that doesn't look so big when you compare it to the entire budget, but this is the one-time funds that we've been using to get the budgets balanced since basically since the pandemic.

You can see it can be pretty sizable.

I have another slide where I'll talk about the sources briefly, but this is part of— this has sort of been a source that's masked the fact that we've been under a structural deficit for some time now.

We've had to use general fund, and in some cases recently we've had to use medical claims trust funds.

We've had to use other sources of— I won't even call them revenue, really they're savings accounts that we've had to use to fund the budget, the difference between what we're collecting in real revenues and how much we have to spend through the operation of city government.

So when I— this is the amount for the entire general fund for the for the past 7 years.

If I strip out school, this is what's left in the municipal side.

And you can see that the red looks a little bit more significant when you're comparing it to just the school— to just the municipal piece.

None of these one-time-only fixes are needed for the school department because we do get the net school spending compliance, and we use property taxes to take care of all of our local share.

We don't need to do anything else to balance that budget, but we do need to use other sources for the municipal side.

Taking this red line, which is still not overly, uh, apparent when you— even when you strip out school, but if I carve it out by itself, these are the sources down below and the amounts up above of the one-time money we've been using for the last 6 years.

You can see that the biggest shares are free cash.

We've had to fund a lot of our proposed budgets that had been reduced by the council.

We've been through this through many, many meetings over the last 3 years.

There are things that have to happen.

One of the biggest examples is solid waste, of course.

When I first came back here to take over, on the CFO role in 2023, that was the year the council had cut general government unclassified by $7 million.

That represented a 54% cut to every single component of general government unclassified.

The biggest share of that was solid waste, but there were other things in there such as general insurance and Medicare taxes that are withheld from employees' paychecks.

Those can't be cut.

So we came back several times through supplementals.

We did get $2 million approved through a supplemental, but the balance of that we had to fund through free cash.

So here's an example of reductions to the budget that we then had to use free cash for because we couldn't use— we couldn't build them into the tax rates.

And that process has happened in each of these years, and I think the sum total is going to be well over $35 million that we've had to use to balance our budget.

I think that's the last of the slides.

So I wanted to end on that note because that's, that's the concern that we have.

Um, it's a struggle when your general fund expenditures are going up in terms of 6 to 10%, mostly in areas that you can't control and your revenues are not growing that fast.

You've got local receipts growing at 2.5%, and, you know, the Proposition 2.5 ceiling on the tax levy is 2.5%.

So it's only so much we can raise revenues, but the sky is the limit on the expenditure side, as we've seen.

So the use of the one-time money in the past has not been included in the budget obviously this year.

So we're budgeting our entire budgets based on current revenues to fund current expenditures.

And that's the reason why we've had to come up and make so many cuts this year.

That's pretty much all I have to say for the time being.

I will go into— obviously, the departmental meetings start next Tuesday night.

And so more of the specific things about department requests and cuts that the city has taken, we can go into more depth with that later on.

But for the time being, I think I just want to keep this at a higher level, see if anybody has any high-level questions right now.

I can't really be prepared to answer a lot of specific department questions because we'll need the department heads there to defend their own budgets.

But certainly on the general from the general city side, this would be a good time.

Okay, um, so colleagues, I just want— I'll take a quick survey of the room.

That— the— thank you, Bob, for your presentation before us.

I appreciate it.

It took a little longer than I expected.

Do we want to have the school department get up and then we'll ask Bob questions after so those folks can get home, or do we want to just get our questions out of the way to Bob quickly?

Get our questions out of the way because— okay, because then the school department was prepared and actually gave us copies of their presentation.

Did we not get one, Bob or Sharon?

Because that's customary to give us.

I'm sorry, we did not.

Okay, I just want to make sure I can get those to you.

This one, I can print them out right after.

No, you don't have to now, it's already over.

But if you could email it to the office so we can just get a copy of it.

But the school department also has a lengthy presentation as well.

But I just wanted to— yeah, if we could just ask questions.

Sure.

But I just wanted to make note of that in the future.

As you are aware, the, the— Councilor Abrams, my apologies on that one.

Uh, thank you, uh, Mr. President.

Um, thank you, Bob, for coming here.

I just— I'm sure you're well aware of the December 11th, 2025 article, uh, in the New Bedford Light that talks about us being under a budget by $4.8 million.

And just, you know, I think Colin Hogan interviewed you talking about how we had a $4.8 million surplus based on its better-than-expected expenditures, plus $8.5 million from better-than-expected tax receipts.

So that gave us a surplus of just over $13 million.

I just don't understand the $50.7 million swing the other way to get us so negative.

That's a lot.

Well, one of the big drivers for the revenue success last year was closing out the cable access funds that was taken in as— so cable access became an enterprise fund in 2018, and when it did so, it no longer was a special revenue fund.

Those monies should have been turned over to the general fund.

So we actually executed on that.

During last year, and we recognized that as revenue.

And then, as you will recall, we then set it aside for a stabilization fund that happened in this fiscal year.

So that drove a lot of that increase.

The other big increases that we tend to get each year are local receipts.

When we have to come in with a budget for our local receipts that equals a trailing 12-month average, as I mentioned before.

Uh, if we're fortunate enough, we'll break that, and that's what we usually do.

That's our biggest source of surplus revenue.

I don't have the exact breakdowns because I could produce them, but like off the top of my head, I, I'm not sure on the 2025 numbers.

Uh, that was also a year that we did not— for the first time, I believe, in the city's history, we did not go over budget in a single account.

173 separate budget lines, and we stayed within budget every single time.

So there were no deficits in any accounts.

There was only turnbacks.

Um, again, you know, this is, this is also— '25 was a year that we, we didn't have any union or any union contract increases.

We had more reasonable solid waste numbers under the original capital, capital waste contract.

Electricity and gas and diesel fuel hadn't skyrocketed like they did this year.

There's a number of different things.

It goes back to that slide that I presented before.

But it is— one year's surplus doesn't mean the next year is going to be a surplus.

Every year is a separate— stands on its own.

Okay.

And state aid obviously not catching up with inflation since 2008, the formula not being fixed.

Um, I'm told that we're about 7 or 8 cents behind where we should be per dollar in, in reimbursement.

Is that correct?

We get about 28 cents on the dollar, 27, and we should be around 35.

Is that correct?

Or 7 cents on a dollar of— in terms of what?

Uh, for every dollar on reimbursement from the state.

So we should be, uh, I believe it should be— we should be getting about 35, 36 cents back from, from that the, the output, the input from the state, the output that we put, us taxpayers, us getting— excuse me— that money back into our coffers here in the city.

I mean, talk about that formula though.

That formula needs to be fixed.

It hasn't kept up with inflation.

There's a lot of problems, and I know you can't answer that.

You're not on the Hill, but you speak to that just a very little bit, and I know we got to move this along, but— well, so unrestricted general government aid is a combination of the old state lottery fund plus a little miscellaneous fund they call the I think it was called miscellaneous.

That was all formula-driven back in 2028— 2008, I should say.

And then when the 9C cuts came, they froze every community at that rate.

And after that, every community shares— up until this past year in the Senate Ways and Means version is changing that distribution a little bit.

But every single municipality since 2008 just gets the same bump that the state allows.

Like last year, for instance, we had 2.5%.

Every single community— Brockton, Fall River, Lynn, Lawrence— everybody got the same 2.5% increase on unrestricted general government aid.

So it's really not tied to anything any longer.

So that's why I'm not sure about— I can't answer that 7 cents on a dollar.

I'm not sure where that comes from.

All right, thank you.

I— Mr. President, I'll yield for now because I know we have to keep the flow going.

We have a pretty large presentation from the schools.

I had other questions, but I'll yield.

I think my colleagues may have some of the similar questions that I was going to have, so I'll step aside for now.

Thank you.

Okay, Councilor, thank you.

Chair recognizes Councilor Burgos.

Uh, Bob, uh, the first question I guess I have, the big picture questions, um, who's going to be in charge of Health and Human Services?

I'm not sure if the administration has announced that yet.

Okay, because I do see in there there's a director of public health still and an assistant director.

There's the director of veteran services, director of council on aging, right?

And then the executive aide, which I assume is still for the licensing.

But there's still staff for community services.

So then who would they be reporting to if their department head is— no, there's no director of community services anymore.

So then who would they report to?

I would have to defer to the mayor's office because that would be the ones that make the appointment.

I'm not sure they announced anything yet.

Okay, so they haven't figured that out yet.

All right, that's good.

I'm not sure if they figured it out or not, but they just haven't announced one.

It wouldn't be my place to do that.

And will we be getting a full list of all the positions that have been shifted around?

Because like, for example, in the assessor's office there, it looks as though on the, the sheet that is at the beginning, they have a reduction of one staff member.

Yes, but in actuality, there's one less body FTE-wise, but there's 3 new positions or 3 reclassifications potentially.

And again, that might be a question for whoever is going to present for the assessors, but the administrative manager, that's an M9, a compliance officer, that's M6, and a project coordinator, um, that those never existed before in the assessor's office.

At least not in FY26 budget.

We can look into that.

There's not a headcount that— there may have been increases or change during the year.

Okay.

Like someone might have gotten, um, someone might have gotten, uh, bumped.

What some— what happens during the year is that, uh, a job gets reassessed from time to time.

There's this thing called the Job Assessment Questionnaire, JAQ.

Goes to HR, and HR determines whether if the position— if the person is doing work above the position.

So that can happen.

So that might be the case in, in this particular situation.

But the, the one reduction to assessor because there's a vacancy and we're not filling that vacancy, that's part of the 58 vacancies that the mayor had addressed last week.

And then those 3 positions would have just been reclassified?

Yeah, they would have been the same people potentially.

So then Basically all those— because that's not the only— that was just my example.

But so basically your recommendation is when those department heads come forward, ask them about those, they'll be prepared to answer?

Yes, a departmental level question would be better.

Okay.

The other question I have about the budget book this year compared to last year's is why are— why don't we have a breakdown of all the contractual services?

Last year we had a whole section that had the contractual services that were very detailed.

And it was a whole breakdown to like the copier paper, um, dues and subscriptions, and that's not in this budget.

That's what the blank page is.

Unfortunately, in my cover— my transmittal letter, I pointed out we had gotten overwhelming compliance from our departments this year, uh, to the tune of something like, I think, 3,000 or 4,000 line items of detail.

And my apologies, but we ran out of time to to actually include it in the budget books, and we promised to have it out in time for the first city departmental hearings, which would be Tuesday night.

Um, we would, we would, we would distribute it as an exhibit, sort of what was done with the old personnel rosters before we embedded them into the book.

So we will get details on all the breakdown?

Okay.

Yep.

Um, in your opening remark, well Earlier in your remarks, about an hour ago, you were talking about, uh, the CIP and how typically like smaller items, uh, we would include.

Like for example, I know that the school department was looking for $150,000 for vehicles, but for some reason it wasn't included in the CIP.

I'm just curious why it was added to their non-net school spending cost as opposed to being included in this last CIP.

Well, for the CIP, we had, uh, there was 3 vehicles.

Um, I can't recall the amount, but they were included in the CIP though.

$220,000, I, I believe, was the grand total.

Well, there were vehicles from them and other departments, but then I know that under— there was, uh, when I went to their budget presentation, they included, uh, $150,000 that was not approved to be in the— this past CIP.

Oh, so, so you, uh, are you referring to the one, the presentation that they just had?

Correct.

Yeah.

Okay, so what happens there, the most recent CIP is the one that we just had passed.

Uh, that's in the— so what happens is those requests get pushed off just like the other $3 million here.

They're going to be in the CIP that we're going to be putting together.

Okay.

For this year.

The other question I had, the mayor during his address mentioned only $3 million reduction.

I don't know if you remember that, to the school budget.

That was in his address.

We could play that back, but you mentioned it's $4.5.

Why the discrepancy?

The mayor was referring to the Chapter 70, the net school spending piece.

Oh, that was— so that's the, um, that's before the $3 million, uh, the $2 million.

I think that— and he may have, he may have been rounding off to the nearest million, but it was like $2.6, $2.7 million.

Yeah, $2.5 $2,556,000.

And then $2 million cut to their transportation line.

Are we not concerned about that $2 million cut to the transportation?

I know we can make up on the net school spending line, that we technically can go under net school spending.

I know this administration doesn't care about that.

But when it comes to transportation side of it, it is very difficult when I see a lot of times I do get phone calls from parents when their kids are having difficulties getting on a bus because there's not enough room on buses.

And now we know that this administration has reduced the school department's transportation costs by another $2 million.

And I'm worried about what that will do to the school's transportation that's already hurting.

Yeah, so I have had conversations with David Flynn about this.

As I said before, it's not the administration— we, the administration, are not proposing a $2 million cut to transportation.

We did hold back this $2 million on that line item.

What do you mean you're not proposing a $2 million cut?

Well, no, there's a reduction in that line item, but it's more of a holdback until we see what the Chapter 70 formulas finish up with the Cherry Sheet aid and Cherry Sheet assessments that won't be finalized until July.

Okay, so you— at that point, we will the similar to what we did last year, we will make them whole for the— it's the time.

Okay.

Yes.

Okay.

Thank you.

That's all.

Thank you, Chair Agnes.

Councilor Chaukat.

Good evening.

Thank you, Mr. President.

Thank you, Bob.

It's okay, Councilor Lopes, you'll get your turn.

Uh, I don't know if this is a question you can answer here.

You might have to send me the material.

I don't see the breakdown.

Um, I'd like to see the commercial revenue before it's been corrected with the difference in tax over the last 3 years.

So pure— the pure commercial tax revenue.

Oh, the other— yeah, over the last 3 years.

So that I'd like to see it because one could probably assume you can gauge whether the economy around the city is growing, remaining stagnant, or contracting based upon that value before taxes are raised against it.

Sure.

That would be very interesting.

Yeah, we have real estate taxes broken out, obviously.

Well, real estate and personal property broken out by residential, industrial.

Yeah, and I definitely want to see commercial, personal property, business development.

Yep.

Okay, can you email that to me?

Uh, yeah, sure.

All right, thank you.

I yield, Mr. President.

Thank you.

Councilor Lopes.

Thank you, Council President.

So Bob, 2 quick questions.

One on the solid waste.

How many people bid on the new contract for solid waste?

Well, 3, but one only bid on the recover— on the recycling facility, so they were deemed non-responsive.

So it was 2.

So 2.

And then just for the general public's clarification, the last time we did a— the garbage contract, how long was that for and how many people bid on it?

So it was done before I came back, but I can tell you that it was for 3 years.

I don't know how many people bid.

Wasn't it at least 2?

Wasn't it?

I thought it was a sole source.

No, no, I know that Capital Waste bid and Waste Management.

Can you provide me with the last refuge contract that we signed, as well as all the bid sheets for it?

Yeah, I'm sure we can.

Thank you.

Find that.

And then I know you mentioned CIPs and vehicles.

We used to buy them with cash, we used to lease them.

So now can you, for the next CIP, can I get a list of all the vehicles being retired versus the useful life of that vehicle, and then a structure of the loan falling mass general loss Chapter 44, Section 7, which states the useful life of a vehicle and the financing for it?

Because I want to make sure we're not going out too long on some of these vehicles that have extremely short lives.

And I know Mass General Law normally says with a vehicle, unless it's a fire apparatus, you can go out longer than that 5-year period.

Yeah.

So I think you're saying, are we using vehicles beyond their useful lives?

And I can tell you the answer is going to be yes.

Yeah.

But I just want to see the breakdown of the vehicles that are retiring, the useful life for that vehicle and everything else.

Okay, sure.

Okay, because I know I've heard some stories about some of the vehicles that have not had their full useful life and we're replacing them.

So one of the, the discussion points that we had in the CIP this past go-around was to build out a full replacement schedule.

Uh, I, I know that EMS has done a good job in doing that.

The other departments we're working with right now to get a traditional schedule so you can see the— oh, the major pieces.

Obviously there's a lot of rolling stock, small things, and, and the full fleet is like almost 1,000 pieces, but we don't want to do that much.

But just the ones that are being retired, that's all.

Okay.

All right, thank you.

Thank you, Council President.

Thank you, Councilor Roy.

Thanks, Mr. President.

Uh, hi, Bob.

Hey.

You know, this $32 million number, and, and I appreciate you going over, um, all the numbers before, but I'm thinking back to like the mayor's State of the City address.

I'm thinking back to, um, the mayor going on the radio, you know, like a couple weeks later, and, and then to him addressing this body presenting his budget.

And the number went from $18 million to $28 million, and now it's at $32 million.

All right, how does that happen?

Like, how does, how does something like that, you know, go from $18 to $32?

Can you, can you just give us Just a whirl on that.

Sure.

Well, that was the starting point, obviously, that we started with.

That was the gap that we opened with.

So the first numbers that were quoted were, were in all likelihood— I have to double-check— were in all likelihood not counting the department requests, what we call enhancements.

There's really no difference in the end between a baseline request and an enhancement request, except that we give a lot more assurance that we're going to include baseline costs within the budget.

But departments did ask for $8— $7.5 million of enhancements for new programs and new initiatives, okay, and that was not part of the first $18 million.

Like the $28 to $32 is probably undoubtedly because of the solid waste contract opening.

But what happens is all during the year from the 4th Wednesday of January when the numbers first opened with the governor's budget submitted, Uh, when she submits her budget, uh, those numbers change throughout.

We get assessment notices from all the different— everybody who assesses us: Bristol-Laggy, Graydon, New Bedford, Voce Tech, charter school.

Well, the charter school I already probably counted.

Pension assessments.

There's a number of different things that come in in addition to the department requests.

And then with the department requests, we sit down, we go over them.

Sometimes you find out that departments didn't ask for enough.

One of the cases was with, with fuel, diesel and gas.

I think maybe it was enough of a request at the time it was done, but that— but we did look back and pick up another $400,000.

Electricity is a big one.

We didn't have any numbers.

You guys didn't know enhancements were coming down the pipe when the mayor gave his State of the City?

Department— the State of the City, I mean, the departments usually ask for enhancements every year, right?

Uh, yeah, yeah, yeah.

But I think that the number there was— um, uh, I'm not sure.

I have to see what number he used.

I'm not sure if he had the enhancement requests in them, but whether they were— whether they were or they weren't, but they were— we put them in and then we had to say no to them all.

So that's, that's part of the number to get to the $32 million.

So maybe it was the $18 went to $32 in part because The mayor didn't pick up on the enhancements because I didn't send them to him.

But now I have.

And then I took them back out.

So it's, it's going to be one of those kinds of exercises, though.

All right.

That's interesting.

All right.

So also, Bob, you— it's fair to say— I'm just curious about, like, other municipalities in the area.

It's fair to say you watch what other municipalities are like, Taunton, Fall River.

Could you explain why cities like Fall River aren't maybe in the mess that we're in right now?

Are they doing something differently?

Can you all opine on that for a few minutes?

So Fall River just put its budget out, I think it was last week.

And I haven't been through it yet, to be honest with you.

But their state aid situation is a bit different than ours, too.

I can go down to little things, like they get $1.6 million every year for public safety grants from the state for part of the Gateway Cities Program that only included 10 gateway cities in its mix.

I'd have to take a look at what their net— what their local share is for education to find out if they included— if they have an easier local share to meet than we do.

They don't have a pension issue like we do?

They should have a pension issue.

Healthcare issue like we do?

They don't have rising healthcare costs?

They probably have a worse healthcare issue from what I hear.

But I mean, so there's a section in our adopted budget that we're going to add this year that compares us to, uh, 10 other communities, 5 greater than us in population and 5 less than us.

The problem is getting information at this time of the year.

Many, many municipalities are in different stages of their budget process.

Some put theirs out very early, and others like Fall River just put theirs out just about the same time we did.

I had— I can't find anything from Brockton yet.

They tend to go out a little bit later than the rest of us.

But we do comp and we are aware of what goes on.

But, um, uh, and thank you.

And one more question.

Can you talk about how, uh, the administration calculates net school spending versus how the district would calculate it?

It's a little different, right?

You took a more conservative approach.

So yeah, so when you mean the district, I think you mean our, uh, that's what I mean.

Yeah, so I'm a teacher.

I district is.

So, uh, and I, and I don't have David here to come, uh, to confirm this, but they— so I think the process started off with the traditional bottoms-up budget where they went and built the budget, you know, by asking people what they need.

And they've— and I'm sure they went through the processes of scrubbing that down, and it came up to $267 million, somewhere around there.

Uh, and then David produced a net school spending schedule, which is the same as we do, right?

We compute it the same way.

The big difference between the 2 organizations is what we are— what we're assuming for pension allocations.

So the pension number is $43 million, somewhere around there, right?

So in the past, back in, back in the days of prior superintendents, there wasn't very much available on how they allocated their pensions.

So we started formula— We started formalizing that a little bit more about 2 years ago.

Now, with David and myself, we didn't do a great job speaking to each other about the allocations last year.

It ended up that David came in with the same allocation from the year before and I had much higher.

And we went back and forth a few times.

We ended up settling, agreeing to disagree, I'd say is probably the best way to put it, at a figure of about $14.1 million.

This year what we did was We kept pace with the foundation budget increase, 6.6%.

So our allocation was based on the fact that we wanted to give schools 6.6% increase from the net school spending formula they got last year, which was I think $236 or $238 million.

So we came up with $264.

So right now that's, that's the discrepancy between between the pension allocations.

Yeah.

And what happens if the city spends less on, on the schools than we're supposed to?

If, if we spend less on, on the schools, then we have to make it up either through a supplemental increase, or if it got as far as going to the end-of-year reports the school does, it would show a net school spending deficit.

We haven't had a deficit in net school spending since sometime We had, we had hit a figure of about $8.3 or $8.4 million in net school spending deficits back in the 2018-2019 time frame, somewhere around there.

And we worked it off and got free around '21 or '22.

We've been net school spending positive since then.

So that hasn't happened.

That's not to say it couldn't, but right now it hasn't happened in any of the last 4 or 5 years because we have to make it up every year.

So we actually had to pay.

Do you think it's going to happen this year?

I don't think it is, but it's— the year hasn't even started yet, so it's kind of hard to say.

David and I still need to come up with an agreement on what the pension allocation should be.

The problem is, is that you don't get assessed by person or by organization.

You get one giant assessment.

For the entire system.

In fact, the city itself doesn't have its own assessment.

We get allocated 88% change, somewhere around there, by PERAC.

The only assessment, the only actuarial report that's done is for the entire system of 5 employers.

So that's where it gets to be a little bit difficult.

It's not as easy as, say, health insurance, where I know what you are, I know that you're in an HMO plan, you have a family plan, your premium is $2,200 a month, I got to cover 75% of it.

That's a, that's a known thing.

Pensions not— doesn't work that way.

Thank you.

So the allocation that we use in our budget is sufficient enough to mock the fund, uh, the foundation budget increase of 6.6%.

Okay, thank you.

Thank you.

Chair recognizes Councilor Connie.

Yes, thank you, Mr.

Chair.

Um, Bob, I just have— I have a request.

Okay, so I'm looking at the debt services.

Um, 2025 was $9.2 million, 2026 it was $10.2 million.

In 2027, we've gone up approximately $2.5 million in debt service.

That is a line item that we have to pay at $12,755,000.

Can I get a breakdown of what a line item of this individual debt services that we've added on to the $12 million?

Yeah, absolutely.

Okay, that's, that's it.

Thank you, Mr. President.

Uh, just really quickly too, uh, debt service— a lot of these items are under the CFO's budget.

He's going to be before us on June 1st.

So to any of my colleagues, that'll— we'll have further, uh, breakdowns and, and can make further requests of the individual accounts moving, uh, on June 1st as well.

Thank you, Councilman.

I will point out that we include that information in the final budget.

We don't usually include it in the proposed budget, but we obviously have it available.

So your final budget report, your final adopted budget, has a full listing of all the debt items, right?

Um, if you already have it prepared, I wouldn't mind if you would send me an email to me so I can look at it prior to the June 1st meeting.

We have— we have it.

It's in a database.

We'd have to extract it out and make it look presentable, but you know what, If you had it prepared already, I'd like it as soon as I can.

Thank you.

Councilor Oliver.

Thank you, Mr. President.

Thank you, Bob.

Um, Bob, a couple of questions.

Um, I know that you spoke about, uh, we spoke about this deficit.

We're talking about future deficits and structural deficiencies with using one-time payments.

When do we see that ironing itself out?

Where these one-time payments that we— or one-time funding solutions that we utilized are out of the budget?

When are we seeing that?

Well, we have to start doing things to fix the expenditure increases.

Okay, so it's a couple of big items that we were talking about already, and then there's going to be a lot more to come.

But let me give you a couple of examples.

One is that we're going to have to look at extending the funding of the pension system from 2035 to something beyond.

Eric Cohen from the Retirement Board right now is assisting me by trying to ask the actuary, which is KMS Actuaries, for alternative fundings for 2036 and 2040.

We don't want to go to 2040, but I want to know what that number could be.

So that'll give us perhaps as much as $3 million a year if we pick— if we extend it out far enough.

We are going to have to have talks on healthcare reform to some degree, right?

So it's whether we have discussions with unions about the cost sharing for health insurance, whether it's existing employees or all employees hired after such and such a date.

A lot of the communities— I believe the mayor touched on this in one of his presentations— the local communities around Fall River and New Bedford have splits for HMO versus PPO.

They have active versus inactive— retirees, rather.

And they have splits for people hired before such and such a date and those hired after.

So that's on the table.

Perhaps plan redesign with the assistance of the PEC might be on the table.

As you know, without passing Sections 21 to 23, We can't like propose our own plan designs and go to an independent arbiter to resolve any differences with the PEC.

We have to work hand in hand with the PEC.

So we will be pursuing doing that.

These are some of the big ticket line items.

But these are all— all of the things we think about have to be like $1 million or more.

We've got to cover a good 5 or 6 of these kinds of items before we can really start solving the problem.

Then we can get into the smaller things.

You know, like cutting back on a certain type of contract or, um, reducing travel, things like that.

Those are, those are the minor things that are not going to solve the structural deficit.

Okay, and I, and I'm glad that you brought up 2123 because I'm, I'm assuming it's going to be falling on my desk soon, um, from the, from the administration requesting that I can't really get an answer as to what that would actually save.

We just hear— it would save us money.

And we go on the radio or we tell— we say that the council refuses to adopt this and it would save money.

Is there any idea on what that would ballpark realistically save?

Well, what would happen is we would bring in our healthcare consultants, Lockton out of Boston, and they would come up with ideas on plan redesigns, copays, deductibles, certain types of things covered, perhaps getting into prescription plans, things like that.

And then they'll propose ideas before to us and to the PEC, and we would then try to come to an agreement.

Without 21 to 23, we don't have much say.

So adopt it to find out how much we could save?

Is that what— I'm sorry, so adopt it to find out how much we can save?

Is that what we're— you would— what you would do is you're, by adopting it, you're adopting a mechanism to resolve a discrepancy should a discrepancy happen.

A discrepancy can't happen until you actually start looking at plan redesigns.

So right now there's— it's— it's— we talk about plan redesigns, but we haven't commissioned anyone to actually start that study yet.

Well, we talk about it, but what would just a a modest plan redesign be?

Has anybody looked into that?

Yeah, well, yeah, so you mean what are the types?

I just want to know how much we're talking about when we're talking about discussing this or adopting it.

Yeah.

What are we talking about?

All we hear is it's going to save money.

You're talking about a mechanism, not an actual savings.

I mean, it'd be hard to say.

I mean, you want to increase office visit copays, you want to increase the deductible.

There's so many different options out there.

Like, it's hard to pick anything.

And then just a plain blunt answer, has the administration had any discussions with you about a possible Proposition 2.5 override?

No, no, okay, no, that's, that's, uh, I think the only discussions we've had is that, that, that is like, that's beyond a break-glass measure.

And matter of fact, I would think, I would think closing down all the safety centers would be a break glass measure too.

But all of those cuts that you saw that we, we had done were to make sure we got to within Proposition 2.5.

Um, okay, but no, no discussions as far as you've had with the, with the administra— the administration?

I mean, sure, this is— it's been brought up in fact that you, you have that as an option, and like the administration is absolutely not.

Okay, that's, that's— well, so technically a discussion, yes, but not a serious discussion.

Okay, about implementing.

All right, thank you.

That's all.

Thank you, Mr.

Chair.

Thank you.

Just a few quick questions, Bob, and then, uh, we'll, we'll get on.

Uh, you had spoken, uh, Councilor Roy had brought up that, uh, comparing to Fall River's budget or other communities, you brought up that Fall River is having some— you're thinking some issues with their health insurance.

They have, uh, they have health insurance costs.

Fall River is one of the, uh, They probably wouldn't like me saying it's one of the dinosaurs, in that they still allocate their general fund expenditures on a percentage of medical claims incurred, which is really not an acceptable way to do it.

So they tend to run the gamut of— they have to absorb the risk of health insurance costs increasing or decreasing all within their general fund.

We and many of the other communities like for instance Brockton, we pushed all of that risk to Medical Claims Trust Fund.

That is like your insurance company.

So the, the city has a known amount for health insurance each year.

And again, it's like enrollment times the plan.

So I think that might be, um, one of their problems.

They also— I know that they are a GLP-1 approved.

They— I think they allow GLP-1s for, for one full year for an employee where We do not.

There's lots of things like that, but I just was pointing that out because I know that Fall River is one of the communities that have adopted 21 and 23.

Yeah, um, and they— while they might budget it differently, they have this mechanism that could save money.

The other thing that I just wanted to point out too is in, in what you just— the only other thing I would say is that the city at any time could go to the PEC.

And ask the PEC to look at these changes that would save money.

Yes.

Has that occurred recently?

Not to my knowledge, but that would be something that HR would, would be the champion of.

I haven't really spoken with Jose.

HR would be the champion of— I'm sorry.

Yeah, yeah.

Okay, human resources, right?

Yeah.

Okay, personnel would have to do that.

They would work.

I know that he— that Jose has lots of discussions with Lockton about these types of things.

What's— whether they formally present anything to the PEC, not to my knowledge.

But, um, so, so essentially the only thing that would change is the, like you said, the mechanism.

The mechanism.

So we could be trying it consistently every month saying, or every quarter I think the PEC meets, hey, please adopt this so we save money.

Yeah, we could, we could say to the PEC if we want to go from $375 deductible, $375 in a $750 family, we could say let's double it.

No, not to my knowledge.

Any other questions?

All right, thank you, Bob.

Appreciate it.

Thank you, Mr.

Superintendent.

As you're making your way up here, I just want to thank you and your staff and school fellow elected officials, the school committee members that are here.

Thank you for being here.

We appreciate your coming out for our budget presentation to us.

And sorry it took a little, probably longer than anticipated, but I appreciate you hanging out and being here.

Sorry.

Yes, go ahead.

Thank you.

Uh, good evening, Mr. President, members of the council.

Um, really appreciate the opportunity again to go over our FY 2027 budget.

Mr. Flynn is not here.

Our normal schedule is after Memorial Day, so he, he had a pre-scheduled vacation.

So this is great.

I get the opportunity to put on the, the finance hat again, um, as we've done in previous years.

However, this is good.

I really appreciate going first, being early before Memorial Day, because we really want to have an in-depth conversation about our budget.

With as many folks as possible.

This week I met with a community group.

Actually, tomorrow I— at the Whaler Show, which is the New Bedford High School students' show, they interviewed me on the budget.

So this budget discussion will be broadcast to 2,400 students.

We plan to meet with parent groups and others, and I'll describe how we're going to break down the budget for them.

I did hear that the school department has submitted a large presentation, so I'll move swiftly through it.

It's just the feedback from the classroom.

This is your— this is— this is your time, unlimited, sir.

No, I'm only— but, but again, um, sometimes it's not as compelling as, as it might appear to me.

Um, but one, one way we want to break it down, just to give context, is how we're talking to folks about the budget is in the 3 big buckets.

Um, what's the revenue?

You've heard that term per pupil.

It's not really used very well.

It's misused, but the best way to break it down is what's per— what's the per pupil revenue?

What's coming in to the school committee for them to budget?

And then ultimately the budget book you have, those are the costs.

Where are the costs allocated?

That's accounting, essentially accounting for where the costs are going to fall.

That's what you see in the departmental and school breakdown.

And then I do want to make a pitch for per pupil spending.

It's very clear what information is out there.

I want to direct people to that if they're watching on cable, or when we talk to the— our community partners and our parents and our students even this budget season, we want to be able to show them that they can find this information on per pupil spending also.

Um, just to go back real quick, um, you know, I was talking about how I'm going back on the budget piece again, and I will say the first slide— we'll keep going— it swipes.

Okay, so I will say we talked to the school committee about this, that we have had a track record since 2016 of stable budgets, and that's what we want to continue for next year.

You'll see around the state right now almost all communities are affected, their school department budgets are affected.

I did see a headline Brockton is laying off some folks, etc., and we always want to present a stable budget.

Those of us who've worked and served the district for a long time remember this period, the pre-SOA period and pre-stability period, where you'd have layoffs, pink slips, you'd have school closures, all of that.

We haven't had that over the past 10 years that I've been presenting budgets.

Obviously there's been finance reform in Massachusetts which has fed that, but that— but also the tools we have and the information we can rely on, our ability to forecast the school committee's role.

The school committee meets twice per month and publishes publicly the budget and live tracking of our expenditures and transfers to cover any shortfalls in different accounts.

And so we want the public to know, the community to know how we oversee the school budget and spending.

So I just want to start on revenue.

And revenue, you start from the Cherry Sheet, you start from Chapter 70.

Our revenue is essentially Chapter 70 plus the local contribution.

And folks can dig in and verify those numbers.

You go to the Cherry Sheet, you'll see the revenue that's coming, and you'll see the assessments, how much goes to charter schools, for example.

And then the state makes that promise.

The state says, This is the legal requirement, the legal minimum.

That's what foundation is through the lawsuits through the '90s about how can we provide a basic education, an equitable education.

The state says you have to provide a foundation.

What the deal is, the state will kick in up to about 86% of that.

That's what Chapter 70 is.

If the city can demonstrate or city or town can demonstrate the match, the 14%.

And it's also broken down by category.

So these reports are on DESE's website where you can see how much the state plans to commit, how much the state says it will cost to educate the bare minimum for a New Bedford student next year.

And it even advises what categories— the state even calculates how much you should spend in each category of that minimum.

So of the minimum, it says that New Bedford should spend next year $11 million on administration.

We actually spend half that on administration.

We spend half— we spend one of the lowest administration in the state.

It's actually going to be lower again next year.

You'll see in the budget book.

Where we do spend more is we do spend more on things like counseling, student support, health services, special education.

We finally have been able to spend the minimum on maintenance.

We have a strong and growing maintenance and facilities staff who do a great job.

And we've finally been able to close what was called the teacher gap.

So we have more staff in schools, more paraeducators in schools.

So I won't spend too long on this, but just to know that it's all formula-based.

And this is basically— there are 14,000 resident students in the charter schools and the public schools, and the city has to demonstrate, once it gets to Chapter 70, of $271 million, it has to demonstrate spending of $314 on those students for next year.

So it has to demonstrate that $43 million as part of the Chapter 70 partnership.

That's what this looks like— state aid and the city contribution that should be demonstrated.

But what that looks like in practice is actually very different because you have assessments for VOC, you have assessments for Aggie, you have assessments for the charter schools.

And when you actually break it down, once that match is demonstrated, once the minimum goes to every school's— every school district, what you see is actually the contribution that ends up in New Bedford Public School classrooms is far lower than ends up in Voc, in Aggie, or the charter schools.

Retiree healthcare is counted as a demonstration.

The school committee doesn't receive that.

The pension assessment is counted As a demonstration, the school committee doesn't receive that.

And so that essentially comes off the per pupil that goes into a New Bedford Public School classroom.

So whereas up to $3,000 will go into a charter school classroom, up to $3,000 plus will go into the vocational agricultural school, in some respects about $1,000 of city contribution goes into a New Bedford Public School.

Just— I did see this report.

I want to make a plug for it when we're talking about revenue.

Mike Goodman, who's a public policy professor well established at the UMass Dartmouth School of Public Policy, put out a New Bedford property tax simulation tool.

So you can actually see, if you put in your assessed value, you can estimate your property tax bill for a previous year and see how much has been spent from that property tax on public schools.

You'll see that New Bedford Public Schools gets about $1,000 on a $4,500 bill.

And the charter schools get about $500,000.

Now, you'll note that the charter school population is 10%, so it's half, but it should be lower to 10%.

So I just think it's an interesting tool to demonstrate how much revenue actually gets to the school committee to go into New Bedford classrooms.

So that's revenue.

It is very important.

That's one reason we've been able to present balanced budgets.

We do a lot of work forecasting how much revenue will come in as early as possible.

But the real budget is costs.

Our goal is to meet all the costs to meet the needs of students next year, and that again is primary focus of the budget book you were sent.

So the costs are broken down by 24 schools, 22 departments.

Mr. Flynn and his budget team do a great job working with each of the schools and departments to have them forecast costs, have them forecast needs, and each one is broken out, the forecasted budget, in a page in the budget book.

But what really is driving costs are these categories.

So we want to— headline, we want to maintain level service.

That's always our first test.

You test your budget.

What would it take to maintain the services we have now?

That's the first test, level service.

And what would it take to retain all our positions?

Over that 10-year period, we've in some respects almost doubled school building positions, classroom positions.

We closed the teacher gap.

An elementary school 10 years ago in Newton would have had twice as many teachers or educator staff as a New Bedford school.

We've closed that gap.

You'll see that, as we'll see— I'll make a plug for our website where you can see the old books and the new book, and you can see that that's where the money has gone, into buildings, into hiring, teachers, paraeducators.

But now we want to retain those, and those are negotiated contracts, collective bargaining agreements.

Our majority of our staff are unionized, obviously our educators.

And fortunately, we were able to settle those contracts all in one year— the paraeducator contract, the Unit A teacher contract, and the NBSSU behaviorist wraparound folks.

We settled all those in one calendar year.

Which is unique for a district.

But then that allows us to forecast.

And those contracts, while obviously the cost of living and inflation is out of control for everybody right now and it's hard to figure out what folks— what's an affordable cost of living— those contracts have record raises.

So we do have record hiring where we are seeing staff come to us from other districts.

We're able to retain them.

But that's a challenge.

How do we retain all the needed positions?

How do we keep those record COLA increases for our collective bargaining units into next year.

So we'll talk about that.

The other major cost drivers are extraordinary costs.

So revenue might go up 6%, but other costs are going up way above 6%.

Education is expensive.

Inclusion is expensive.

And we'll see that.

So, for example, we'll just go back up to staff.

So we— if our budget is increasing anywhere up to about $19 million, $10 million of that, $10.5 million of that is for those staff contracts.

Our strategic plan actually says we're the largest employer within the city limits.

We are the daily workforce for the largest number of city residents.

We do have record hiring.

That's why when something breaks in New Bedford Public Schools, it gets fixed thanks to our maintenance staff.

Our custodial staff.

We have record staffing, so our schools are safer, more responsive, and making progress.

As we'll see, we have wraparound to reach out to families.

So overall, all those increases are projected into next year.

That's about $10.6 million.

But the real extraordinary increases are in special education, out-of-district tuition, the students with the most significant special education needs.

That's a large portion of our budget.

No other city school pays within their budget— that's the New Bedford School Committee— pays for out-of-district tuition.

And that's going up by about $2 million next year.

ABA, autism services, speech services, and nursing and other contracted services for students with needs, that's going up about $2 million.

Those increases are closer to 10%.

But our special education programs are a source of pride.

Our model of inclusion within our schools are a source of pride.

I invite everybody May 28th to the next Special Olympics event at the McCoy Field if you did miss the last one last week.

And we are posting record graduation levels in special education programming also.

Health insurance, as we know, is going up again.

If the budget's going up 6%, health insurance is closer to 9%.

That's another $3 million in that $19 million increase.

Utilities also are going up, as we've heard, close to 10%.

Just put this picture up here of some of the utility work that we undertook last year.

The old schools, as we've heard, in the old schools have old fuse boxes, and it was long overlooked.

Those improvements weren't in any capital plan.

Those buildings aren't getting replaced.

So the school committee invested some salary savings and redid the wiring at Winslow and Pacheco and other schools.

Just some of the work that— some of that maintenance investment.

So overall, this is where the increase is going.

The increase, it's almost non— it's essentially non-discretionary.

We're covering costs.

We get the minimum revenue, the lower revenue of any school that serves city residents, but we have the most extraordinary costs.

And then, but we are able to project that and we are able to cover that in the minimum budget we're presenting.

And this is just another way of breaking it down: maintain staff, ensure that costs of special education are met and health insurance are met, which is driven by staff of course, and then some other costs such as supplies and utilities.

That's all of the increase for the New Bedford Public Schools.

And this is just another way to frame it.

You go back to that $314 million figure that the state is going to look for the city to demonstrate.

You have the New Bedford Public Schools budget, the charter schools, which are guaranteed always 100% of net school spending— they don't get cut.

You have the city assessments, which the school committee doesn't see.

And then you have the school budget.

And of course, the big— my big item, which doesn't have any kind of Chapter 70 or reimbursement, there are some smaller reimbursements which we can talk about.

Interestingly, vocational, regional vocational transportation is reimbursed.

So buses going to voc or budgeted there are reimbursed.

Our buses aren't reimbursed.

There are some programs that reimburse some portions of it.

The New Bedford School Committee budget for transportation actually serves Alma del Mar, parochial, our sister school, and it serves students on IEPs.

We are fortunate that we have city or regional companies like Reliable Bus, like Trembly, and Whaling City Bus because they have far lower rates than the big corporations that serve places like Worcester, Boston, et cetera.

So they are lower per day rates, about $450, which is very low.

You go to Plymouth, you're into like $500, $600 with those bigger companies.

So these are competitive rates.

These are local companies who, who do a great job.

It's as simple as when we need something, you call up Margarita and we can make modifications.

We're reliable, those kinds of things.

So these contracts are very important.

They are very competitive.

But IEPs can drive transportation eligibility, and that's a $3 million increase for next year.

So this is overall the budget that the school committee approved.

The school committee takes 3 votes: net school spending, non-net school spending, and an overall budget, and did that May 11th following discussion, a projection at the February meeting and the March meeting, a discussion at the April and May meeting, and then a vote in the session after— and the formal public hearing on May 11th.

Um, just other ways to break it down that are in the book.

Again, most of our spending— where does our spending go?

Most of it goes on our staffing.

The bulk of our staffing is educators and support staff in buildings.

So this was a vote on the 11th.

On the 13th, Although we were sent this— this agenda was posted on the 11th, just before the school committee meeting, and we were able to verify these figures, the $2 million difference in the transportation and $2.5 million or so on the city budget.

So we do have that $4.5 million difference right now in what's proposed for the city and what the school committee has voted to meet those costs and obligations.

At a minimum legal level for next year.

I do want to make a pitch for per pupil spending.

You've heard that term, and I really encourage folks to check out the budget book.

You can just Google it.

You don't even have to go to the website.

Google New Bedford Public Schools budget book.

You land on this page.

They're all there going back.

Now, you know, we don't encourage the use of ChatGPT per se, but you could download the PDFs throw them into ChatGPT and say, show me how many— how many school-based FTEs, show me how many counselors have increased at New Bedford High School over the past 10 years or so.

You could do that.

I may have done that.

But the point being that the FTEs are listed going all the way back 10 years.

You can actually see where the budget growth has gone.

It's gone into staffing our schools with that staff.

DESE does a good job because they have to do it for 300-plus towns.

It's always like a year out, so you'll see FY24.

Where does the money go?

That's a big question.

You'll see that New Bedford spends about half the administrative cost of the state average, or even lower.

You can see that it's actually been going down.

You can see that the money spent on teachers has been going up.

You can get all these reports, and it's a pretty cool tool.

Just before I came down, actually, DESE did send an email that the FY25 data is going to be updated.

So I would encourage folks to go look at this.

That said, in some cases, things like administration look higher here than they do in the budget book because if the city assesses— the school department says we are assessing you for $2 million in administrative costs, they're allowed to do that under Mass General Law.

It's not a cost that goes into our classrooms.

Or the school committee overseas.

So actually things— certain things are inflated, but it's a great place to start and it's a great place to make comparisons.

And it's a sample of the report.

Um, so I just want to end because while we're talking about accounting and we're going to continue to have these meetings with our PTOs and others so they can break down an understanding of the budget in these categories, I do want to talk about where the money is really going.

And we often talk about return on investment and where is this investment going.

It's the most important investment that the city of New Bedford makes, or any city or town makes, in serving our young people.

But it also should have an impact and honor young people.

So we do have a strategic plan that talks about igniting learning, empowering our educators, uniting the community, and navigating the future, of which budget planning is a part.

And we are seeing success.

There's a lot of talk about recovery from the pandemic, but when we spend or invest or provide contracts to educators, many of whom are providing high-quality AP courses, you can see the graduation rate.

This is a historically large cohort of graduates at a historic percentage.

And we do hear this all the time.

We've heard this for 20 years.

Have standards been lowered?

This is College Board AP, national standard, high-quality number of students in AP courses is increasing.

So by supporting our educators and supporting our schools, we are seeing improvement in academic outcomes.

Preschool is a real success story.

New Bedford School Committee essentially, as we said at school committee last time, is the largest funder of preschool in the region.

Charter schools, others don't fund preschool.

New Bedford Public Schools does.

And we've been able to partner with local preschool providers.

So it's seamless.

It's seamless in the city.

If you have a child with developmental delays and disabilities, they get assessed, they go to the right place.

There's uniformity across.

And so now we're serving more students in more appropriate environments, including at the Parker School.

That's a key investment that we're making and that's paying off.

This just came out this week.

You go to the— it's the news site is called the $74 Million or $74 Million K-12 students in the United States.

This is the key.

This is the leading educational blog.

Essentially, they're highlighting who is beating the odds in early literacy, who is beating the odds in early literacy.

You'll see a little gold star down on the peninsula.

That's the Taylor School.

This is the Brooks School and all of our schools.

Some of them were down here last year.

They're moving up here.

Our investments in early literacy are paying off.

We are beating the odds and getting national recognition.

The arts— the school committee has invested in the arts.

It's reworked schedules.

We're hiring— who are those teachers?

We're hiring more teachers.

We're hiring more arts teachers, more music teachers, more physical education teachers.

New Bedford is providing more music, and this is out-of-date data.

We're going to be on the top of all these charts.

We're providing more music and arts and fine arts because we know that's a true, truly rounded education.

More students will be going to college from New Bedford High School than ever before.

Why?

Because we've invested in counselors.

This is what I was talking about earlier.

The guidance staffing at New Bedford High School has more than doubled, and we're in— we've integrated support systems for students to go to college.

That's growing.

The grad— as the graduation rate grows, students— more students are going to college, and that gets into a virtuous cycle.

So we're really excited to see the college-going numbers that will come.

My prediction is it will be record-setting.

We can talk a lot— as you know, I can talk a lot about facilities, but we've invested in facilities.

The MSBA released a survey dashboard last week.

I encourage you to check it out.

Google again MSBA survey, and you will see that over the past 10 years, New Bedford Public Schools, in tandem with the commitment of the city council for that match has been improving its facilities more than any other district.

Now the other thing was we had to, right?

We had the oldest stock of buildings.

The trouble with buildings also is that they don't get any younger.

They are going to continue to need upkeep.

So after Duval, we've got Ashley, and then we do have— you will see on the dashboard, New Bedford High School is quickly becoming one of the older high schools, and it's slipping into that substandard level.

I'll let you check out the MSBA dashboard, but just know that facilities is something we take very seriously, and those investments are paying off.

Just real quick, the New Bedford Public Schools are unique in the city in how much it commits to services throughout the year.

It is our obligation to basically find and assess disabilities in 3 or 4-year-olds.

No other district does that.

That's in our budget to be able to go out and find students.

It's called Child Find.

We assess those students for developmental disabilities, delays, and then we give them a preschool slot.

We're enrolling in preschool over the summer.

In kindergarten, we're offering— we're using the new pool to offer swim lessons.

We will be providing summer programs.

So I say all this to demonstrate that you have a minimum-funded district that is offering all of these services in a stable budget for this year and next year.

Oh, and that's it.

So overall, this is the discussion we want to have with our partners over the next few weeks.

And as always, we stand ready to answer any questions over the next few weeks and any questions tonight and get back to the council with the answers.

Councilor Burgos.

Thank you.

Thank you, Superintendent O'Leary, for being here tonight and bringing your presentation ahead of time.

I guess the first question I'll address is if the administration doesn't come forward with a supplemental appropriation for the non-net school spending, uh, transportation side, um, is there a plan in place to address potential deficits when it comes to transportation costs?

Yeah, I think at best we're about 10 days out, um, from that information.

So I, I think there's always— we're always eager to review things, and we can review, um, one saving grace that public school districts have because they serve, um, uh, essentially all of the more severe needs of students on IEPs is the circuit breaker program.

And you may have heard that in legislative discussions, and it's so important.

It's a wonderful program that Massachusetts invests in.

So we could look there.

So we would look at that, but there's no straight reduction that works because we have very tiered transportation.

So because we have those local companies, they're fantastic.

We say, hey, can you add the OSS run, our sister school here, and the Alma run there?

So if you cut, you're cutting very, very deep.

So it doesn't just follow that you can drop a couple buses.

So it is going to be complicated, and we haven't had time— we haven't had time to look at it since we got that information.

Okay.

Um, the other concern I had— well, I guess not concerned, but I guess just question— um, you had mentioned obviously, um, investments obviously in teaching and paraprofessionals.

I do see significant increases in paraprofessionals, but I did note that there were some decreases in the teaching numbers in some of the schools.

But I did also notice, oddly enough, that our student enrollment in some of the schools has decreased, which I thought was odd.

I don't know if that's a trend that we're seeing.

Yeah, I think that that's a huge trend around the state.

That's been one of the major causes of all the budget crises around the state.

And, you know, there's that science of demographics, but I would say every district needs to model what it's going to look like if we had 500 students left.

The only 2 districts that increased enrollment were Taunton and Fall River.

And, you know, this body knows all about housing and things like that.

So enrollment is— you've nailed it exactly.

So the small decrease in the teaching staff is essentially because of the small decrease in enrollment.

Okay, so we're not going to be concerned about classroom size— sizes halfway through the year?

No, no, we're, we're in a— we're in the best place we've ever been in terms of classroom size, um, and that's what we, what we commit to keeping.

Okay, just because I know in the past we have talked about occasionally halfway through the school year we do see a slight increase in some student enrollment.

The only school I'll highlight, um, that didn't seem to have that much of a, uh, a change was Carlos Pacheco.

Um, from last year to this year, um, the student enrollment seemed to stay the same, uh, but they— there was a reduction about of about 3 teachers.

So that was my only concern.

Um, that was one of the schools that I wanted to highlight to make sure that we weren't in a situation where we're overcrowding classrooms or anything like that.

Absolutely.

Yeah, and I can— we can break that down and show show that as a follow-up.

I appreciate that.

Um, and then looking at other departments that had reductions, um, on page 56 of our book for Educational Access and Pathways, I was just— I wanted to make sure, um, some of the changes that were made there, especially because I think this department had played such a significant role for our English language learners I know obviously one of the CDAM positions, I'm assuming the world language one, was removed.

Yeah.

And those were pushed out to schools.

One thing we've done over the past few years is essentially take folks, take folks from County Street and put them out in the schools because— and that's been a huge success.

So if you think about English learner strategies or multilingual learner strategies, it's almost like you, you build it in the lab and then you bring it to the field.

And that was the case with college access as well.

That team had been at County Street when they were first hired, and now they're out working with the counselors and others at the high school.

That's an example there.

The other example is early childhood.

But we've broken early childhood into its own role as the preschool has grown with success.

But I can break that out because that on paper, you're right, it does look like a big difference.

Okay, good, because I was going to say one of the significant ones here was the, the teach— the lead teacher and coach position was reduced by 6.

So that's— so, but you're saying that potentially what could have happened was those teachers— those folks are out in the field?

Okay, I just wanted to make sure because that to me was like, whoa, what's happening?

What's the teacher staff in that?

Um, next we have, um, I— and I could have sworn you went over this in a previous budget hearing and Forgive me if I forgot, on page 60 for the fine arts department, similar to that, I'm assuming you're going to give me the same answer you just gave me.

District-wide teachers, that was completely wiped out, the 3.25 FTEs for teachers.

I'm assuming that that was just placed into— and that's good news because now, now the schools have those teachers, have more of those teachers.

All right, I just wanted— okay, but that would be worth— because I see teachers and it goes zero, and I'm like, okay, what happened to our teachers there?

So I just wanted to clarify that.

Okay.

And then lastly here for page 63, Office of School Performance, I wanted clarification on the CDAM positions there— Curriculum, Data, and Assessment Manager, for those at home.

Um, the increase of 3, are these new curriculum, or is it Is that the one where it was, uh, position— I think it was like health.

Yeah, health.

So we, we had budgeted last year, um, for health, and we'd held off on filling that, um, until we, we had a qualified candidate.

And then we also have phys ed, and we also have talked about the literacy work, an additional language arts person there also, which is part— and, and math, although some of that is broken down because of the literacy work.

We were able to obtain a multi-million dollar grant which is carrying that.

So I can break that out in the follow-up also as to which CDAMs are on the new literacy grant and the health, phys ed, and math.

Perfect.

Thank you so much.

That's all.

Thank you.

Councilor Abreu.

Thank you, Mr. President.

Good evening, Superintendent, and good to see you again.

Like always, fantastic presentation.

You explain things very well, and I'm not surprised.

I expected no less.

Just looking through your presentation and looking through the book, just some questions about grants and fiscal cliff concerns maybe I would have, or maybe a taxpayer would have.

I know that This budget does include some substantial grant funding and special revenue funds, and I'm sure you always have a plan in place.

I know you and your team and the school committee does, but what contingency planning has been done to prepare for, heaven forbid, any future state or federal funding reductions given the volatility in Washington, on Beacon Hill, etc.?

Yeah, that's, that's very important.

I think We've been seeing that.

It's some of the interesting quirks of the federal budgeting process is the federal administration proposed a lot of cuts, then Congress restored them, but they're unlikely to grow.

So when some— when a grant doesn't grow and the personnel costs and other costs grow, it's essentially a cut.

So I think we are going to have a significant challenge in the largest grant, Title I, the 21st Century grant, which funds after-school We're going to have that challenge for fiscal year '28.

So there are strategies we can take now.

You can carry over up to 15%.

So if it's an 85% offering in '28, you're made whole.

So we definitely want to look at our carryover.

That's something that's a feature of our reports in front of school committee twice a month.

You can see how much is carried over and you can balance that.

But you're definitely pointing to a concern that could really hit ourselves and other districts in fiscal year '28.

Do other similar superintendents who oversee analogous districts like you do, like in Fall River, the Brocktons, the Lawrences, the Lowells, the Tauntons, are they— do they have the same concerns you do about this?

I'm sure you have a network and you all— yeah, the commissioner actually, Commissioner of Education, met with a bunch of superintendents back in March and set a budget at 85%.

So that's what folks were doing.

But the good news came through, but it's not going to grow.

For next year.

So it's going to be the same in the big cities for those programs, especially if you do hear Title I getting cut.

That's the big one.

And then 21st Century is a great program for after-school programs also.

Okay, great.

And you pretty much explained everything else, um, for the most part, but I just had one more question right now and may think of something else, um, later.

But, um, the budget here references projects anticipated for completion in fiscal year '27.

Um, which projects are fully funded and which may— which of those may require future borrowing or city support?

Um, can you show me the page just so I'm reading from there?

I had it in my notes, so I have to look through the page now.

Uh, hold on.

I had it written down on my notepad here on my phone.

And oh, 20, page 25.

Yep, yep.

Yeah, those, um, so the roof, the roof projects are underway this summer.

Okay.

And we had a very favorable bid opening on that, well within the budget.

Yep.

Um, so those are well within the budget and those are established and the PFAs have been signed and this body has approved.

All of that.

So the roof replacements and all of, all of these actually.

And of course, the highlight is the Congdon DeVall School, which will open in January.

So the city has made a sizable commitment to these and then is able to exploit the anywhere from 60 to 75% match from the MSBA.

Ashley Swift has a long ways to go, right?

I mean, that's in feasibility, but that's exciting also.

But the others are well within the, the funding and, and execution stage.

Okay, I think that's all I have right now.

Um, if I need a second— well, not really a second, it's not so formal— but, uh, if I do want the floor again, I'll ask for it, Mr. President.

Thank you.

Thank you, Andy.

Great work as always.

Thank you, Mr. President.

I'll yield.

Thank you, Councillor Pemberton.

Thank you, Mr. President.

Thank you, Mr.

Superintendent Leary, for being here.

Uh, just a quick question.

I noticed that, uh, there's gonna be an increase in the crossing guards.

Uh, so currently how many schools do we have— how many schools do we have crossing guards at?

Oh wow, um, that's a good one.

I don't have it in front of me.

I pass 2 every day, but, um, I'm gonna have to get back to you on that.

I don't want to speculate.

We have increased, and they're, they're worth their weight in gold, our crossing guards.

I'll get back to you on that.

So how many school— how many per school?

Oh, well, it depends.

It depends.

So we tend to have 2 at Kearney, and a lot of time it's a local recruitment.

I'm sorry, 2 at Pulaski.

A lot of times it's a local recruitment.

We, we tend to have 2 at Lincoln, 1 at Kearney, that kind of— 1 at Jacobs.

And again, it's really important because it's not an all-day commitment.

So we're relying on folks to come out for that short time.

Correct.

So, so my other question then is, so how many in-house security guards do you have?

So the security teams are at the middle and high school.

And so I'll have to get you the number on that.

But it's somewhere in the region of at each middle school around 4 and then multiples of that at the, at the high school.

We've grown that role over the past few years.

Right.

So So there's more, uh, crossing guards than there are security personnel in-house?

No, no, no, no.

There's more— there would be more security FTEs in, but they're in-building, and there are crossing— and the crossing guards is a small shift in the AM and PM, obviously.

Right.

All right.

So the— we, we wouldn't be able to have the in-house doing any crossing guards work?

No, I, I don't think that logistically works.

I think, um, in terms of student, student arrival in building and then the work they do supporting the school teams in building at the secondary level.

It's a little different than the crossing guard role.

All right.

Thank you.

That's all I have for now.

And I will get you those numbers.

I appreciate that.

Thank you.

Thank you, Councillor.

Councillor Roy.

Thank you, Mr. President.

Thanks, Mr. President.

Hi, Superintendent O'Leary.

Since part of the, part of the cuts Well, part of the difference between what the mayor presented of the school budget to us and the school budget that the school committee passed was transportation.

You said it was cut $2.5 million.

I heard you mention something before about Alma buses and OSS buses.

Can you, can you explain the relationship again between transportation costs and other schools in New Bedford that are not part of the district?

Sure.

So technically, the city— the city has an obligation by Mass General Law to bus students who have transportation in their IEP and also to bus students outside 2 miles.

The school committee— and this is the case with many school committees— has the policy, has a tiered policy of 1.5 miles for certain grades and 2 miles.

So then that policy, if it's the policy of the school committee, has to apply to every other student.

Now charter schools, of course, are not neighborhood schools.

So you have a scenario where you could be busing a student from Park Street to the Alma School or the Global School versus that student is ineligible at Park Street.

So it's basically a city obligation that is truly unfunded, and it is an inequitable burden on the city of New Bedford that regional school districts and rural school districts get more reimbursement than a city school.

So hopefully over the coming years that will change.

But it's not— it applies to every student.

So actually, our sister school reached out to us, and technically, legally, that was correct, that, that we needed to assist them with transportation.

We were able to work that out.

So it's just— it's generally the law that applies to every resident child, including those on IEPs.

Thank you.

Any other questions for Superintendent O'Leary?

Councilor Carney?

Yeah, I don't have a question, just a comment.

Um, on the proposal that you gave us that you had on the smart board, there's a few pages of, of the charts that you can't even read.

I can't read them.

So if— can I just contact you and see if you can just— absolutely.

I'll just contact you and give you page numbers and you can— yeah, and I will— I'll, I'll send this also, um, and we'll post that on, on our website.

But please, um, we— I, um, please reach out directly and we can send that to you.

Awesome.

Thank you.

Thank you, Mr.

Chair.

Thank you, uh, Superintendent.

Mr. President.

Thank you.

Uh, super— any other questions for Superintendent O'Leary?

Okay, just from the chair, uh, piggybacking off of a previous colleague's question I, I see you're doing a lot of projections.

I think you alluded to next year's budget as well, and you were cons— you had some concerns about '28's budget with some, um, of that.

What else are the— are you seeing?

Because I know we've been very, I think, very well, uh, assisted with Chapter 70 funds with the Student Opportunity Act, but is that keeping up with the cost?

You basically, I think, in your presentation stated that at the end of the day, the increase in our costs basically have kept up with our, uh, uh, uh, needs— revenues.

Yeah, revenue.

Yeah, yeah.

So my question is, do we see that trend continuing?

Because what we don't want is on that graph you had showed, I think in the earlier slide, that wavy uncertainty and, and making sure we're able to fund appropriately.

Yeah, I think that's, that's crucial.

And I think that's all the more reason we want to lock in this budget, and then it becomes the responsibility of the school committee twice per month to review it.

But we are going to start earlier than ever because you're absolutely right, and Councilor Abrams is absolutely right, that FY28 with demographics— one of the things we've talked to Mr. Flynn and our team about is let's model Let's model if, if 500— if we have a 500-student decline, if we submit data on October 1st, which is the enrollment date we submit, and it's 500 students less.

That could be the case.

That's what happened to Framingham and Chelsea.

And then the state isn't going to fund students who aren't here.

There is small hold harmless, but that's not going to help us.

So why don't we model that now, model what class size would look like, and then we have time during the year to modify our hiring so we don't overextend ourselves.

So that's one, one plan we have, because I do think enrollment is going to continue to decline.

There's no sign.

I think the hostility to immigrant communities, the inability to get housing development moving forward, that's inherently going to affect enrollment.

And that's exactly what's happening to other communities in the state.

Now, Building off of that though, the— because there's going to be a certain point that there is a— the large number of students allows us to be able to have a little bit from every student, so to speak, to be able to afford things like fine arts and extracurricular activities or after-school programming.

And there's a point when, because of the lack of volume, that that we have to claw back on that for every student, and there's a change, correct?

No, because that wouldn't— that doesn't happen because we are state-funded, um, essentially substantially state-funded, um, 85%.

And again, as I said, much of the match is not demonstrable revenue that the school committee applies.

So essentially, the school committee applies almost all of state funding.

So state funding is on enrollment, so that's going to, going to drop.

So your revenue is just going to drop.

And so there's no efficiencies there, or there's not going to be any revenue left to have that flex or, or better class sizes or things like that in a sustainable way.

No, I was saying the opposite.

I don't know if I said it right.

Okay.

If with a large enrollment drop and a large revenue drop because it's proportional, but at some point that adversely affects the district.

Absolutely right.

That's what I was trying to say.

Yeah, yeah, no, absolutely.

That's okay.

And that's— we've got to be very, very ready for that because that's what's happening, right?

Districts, Brockton, etc.

Okay, exactly.

That's what I thought.

Thank you.

Any other questions, colleagues?

Great.

Superintendent O'Leary, thank you very much for your presentation.

Do you want to introduce folks that here?

Yeah, yeah, yeah, we have our outstanding Deputy Superintendent Darcy Youngs, North End resident Vice Chair Melissa Costa, Melissa Texera, who we're very lucky to have on our finance team, Mr. LeBlanc, who's an outstanding STEM teacher from New Bedford High School, Dr. Michael Hall, who is the principal of the Duval School and incoming principal of the Ashley School, Mr. Markey, who I think members of this body know from school committee.

Alex Pella, who's a neighbor and resident of Hathaway School as well as the principal of Hathaway School.

Kim Marshall, who I'm sure many folks in this building know also from Hay Mack.

And Mr. Chris Cotter, also from school committee.

And our AFSCME president, Mr. Mello, and Unit A president, Mr. Nickerson.

Thank you.

Thank you very much, Superintendent O'Leary.

I appreciate you being here, your time.

Thank you, Bob Ekstrom, our city CFO, Shannon Thomas, whose title is basically everything else.

I thank them, and thank you, colleagues.

Thank you, everybody.

And thanks, Sue, for running the cable up there.

All right, have a good night.

We're adjourned at 8:07.