Hamilton Town & School Budgets - A Historical Context. Is Hamilton Spending Beyond its means?

1. Hamilton Town & School Budgets - A Historical Context. Is Hamilton Spending Beyond its means? We used to be fiscally conservative. Have we gone crazy on town government spending ?

2. Why Pull Together This Data? Wanted to answer whether the town can afford the quality of services we provide. Wanted to know whether our spending was crazy & disproportionate to our historical patterns and to other town & state norms How hard should we fight to cut costs vs how hard should we fight to raise revenue? What long term expense growth rate is practical to for the town to sustain? Will better facts help us fight for more state reimbursements?

3. Historical Context is Critical Suppose it is announced that Hamilton now has 20vehicles in the DPW? Should we applaud? Should we cry out for heads to roll? Are we apathetic? The only way to have a handle on managing our town is to put expenses & revenue in a historical context and to establish ways to evaluate the quality of service we get for our money.

4. Hamilton Population 1970 - 2007

5. Hamilton School Population 1970-2007

7. Existing Housing Stock By Year Built We have not added much new residential or commercial development to our tax base

9. 2007 Assessor’s file records date of last sale for each house & provides a rough approximation of tenure

10. Tenure By Last Year Sold

11. Town & School Budgets

12. Total Town & School Budgets 1986-2008

14. Average Residential Single Family Valuation (DOR)

15. Hamilton State Avg Single Family Tax Bill (DOR) $6,846. $3,962 Appreciation Since 1988 (CAGR) 6.4% 5.1% Appreciation Since 1996 (CAGR) 6.8% 5.2%

16. Total Town & School Budget as a percent of Assessed Valuation 1986-2007

17. Cherry Sheet Proceeds as a Percent of Total Town Budget 1986-2007

18. 1,424,341,800. Residential Assessed Values (DOR) 55,870,500. Commercial & Industrial Assessed Values (DOR) 9,134,403. Personal Property (DOR) 1,489,346,703. Total Assessed Value (DOR & Assessor's Office) 95.6% % residential 3.8% % residential

20. Consistency Necessary for Proper Benchmarking • Finance Committee, Treasurer’s Office, Town Clerk & School Committee should meet to standardize data presentation & catagories for proper year-to-year consistency. • Recommend: • 3 years actual historical data • 1 year current budget • 1 year proposed budget • Annual Reports should include all financial data from warrants since they are the book of record • School Data must be included in Annual Reports

21. A database is important Each department should identify metrics that it thinks are important to provide its service function (eg # Children in schools; # Police Hours; Miles Roads Plowed, Minutes to Get to Alarm calls) Track & report those metrics to Selectmen/Public to keep and gain public confidence.

22. Comparative Growth Rates State Personal Income Tax Growth to 2005 4.3% Appreciation Since 1996 (CAGR) CPI Index All Urban Consumers - MetBoston 3.4% CAGR Increase Since 1988 3.0% CAGR Since 1996 Petroleum & Petroleum Products - BLS 9.0%CAGR Increase Since 1988 12.2% CAGR Since 1996 (CAGR) Private Health Benefits Index -BLI 6.9% CAGR Since 1986 6.4% CAGR Since 1996 Employment Cost Index Private Northeast -BLS 3.4% CAGR Since 2001 Average Residential Single Family Valuation 8.1% Appreciation Since 1988 (CAGR) 9.3% Appreciation Since 1996 (CAGR) Median Household Income 3.1% Appreciation Since 1989 (CAGR) Single Family Tax Bill (DOR) 6.4% Tax Bill CAGR Increase Since 1988 6.8% Tax Bill Since 1996 (CAGR) Town Government (excluding debt P&I) 6.0% Town Only CAGR Since 1986 5.7% Town Only CAGR Since 1996 Hamilton Share of Net School Budget 6.6% School Only CAGR Since 1986 7.2% School Only CAGR Since 1996 12.0% SPED CAGR Since 1996

23. Is Hamilton Spending Beyond Its Means? We have the assessed valuation to support town and school budgets at ~ current levels The ratio of our spending to our assets has not changed much in 20+ years. Our income growth is likely around 3-4% CAGR Not all residents experience same income growth so that thay can afford tax increases. Not spending beyond our means but that does not mean everyone can afford 6.8% tax increases with income ~3-4%

24. Is Hamilton Spending Beyond Its Means? Historically our debt level has been negligible for a town our size, but the debt is up slightly. Further research would indicate whether we have debt capacity - but should not be used to pay for operating expenses.

25. We used to be fiscally conservative. Have we gone crazy on town government spending ? • Town spending rates have been around 5.8 - 6.0% • School spending rates have been around 6.6 -7.2% • Very similar growth rates. • Percent allocated to schools - constant for decades • Consolidated spending ~6.8% CAGR (since 1986) is only slightly higher than state CAGR 5.2% but we demand better services. Not Gone Crazy

26. What Growth Rates Are Possible? • Hard to imagine reducing long term growth rate to match state average of 5.2%. • We can hit the brakes in any one year, but too much of the budget expense catagories are out of our control. • Find sources of income that do not demand services • Commercial development will help moderate the burden to residential taxpayers - but will not generate an enormous amount of new revenue. Any bit helps. • Senior housing would also help on the margin.