A central topic of the meeting was the city’s surplus and debt management. The committee reviewed a document titled “Surplus and Debt Findings,” noting a substantial increase in the city’s surplus, which has grown from approximately $4 million in 2016 to nearly $15 million. This growth is primarily attributed to increased revenues from property taxes, occupancy taxes, meranti fees, and parking meter revenues. The committee’s recommendations to the city council have played a role in developing these revenue streams. Despite a stable property tax rate over the past four years, the reassessment of homes sold at higher prices has resulted in increased property tax revenue. The tax assessor ensures timely reassessments, though some documents used for estimates can lag by 12 to 15 months.

The committee discussed the complexities of a city-wide reassessment, which is hindered by limited resources and costs. A digital tax map is estimated to cost around $200,000, while comprehensive reassessment efforts could exceed half a million dollars. The city would not receive state funding for these efforts, which could also impact regional school payment costs. The potential addition of significant ratables from ongoing construction projects along Pittsburgh Avenue was noted, with these properties expected to contribute to property tax revenues upon completion.

The surplus has been beneficial in maintaining stable tax rates and generating significant reserves, providing a cushion against unforeseen expenses. Since 2018, actual revenue has consistently exceeded anticipated revenue by margins of 9% to 19%. Preliminary estimates for 2024 suggest favorable revenue generation, though definitive numbers were not available. The city’s debt profile was also examined, with general fund debt increasing from $2.8 million in 2019 to $4.8 million in 2024. The total debt service for the city has risen approximately 47.8% from 2016 to 2023. While the city has secured favorable interest rates and made efforts to manage and reduce debt, ongoing scrutiny of financial strategies is deemed necessary.

In addition to surplus and debt management, the committee delved into the recycling program, which has become a focal point of concern. The program was originally adopted in 2019, designating the city responsible for residential recycling, while commercial properties were to manage their own recycling responsibilities. However, the city has continued to pick up recycling from commercial properties, leading to confusion and discontent among commercial property owners. The superintendent of Public Works emphasized the need to protect employees’ working conditions, resulting in the tabling of an ordinance originally introduced in September. A workgroup has been reconvened to develop a new approach, reflecting current operational practices.

There was a suggestion to conduct a cost-benefit analysis of the recycling program, with a focus on its impact on the operating budget and services to residents and taxpayers. The city’s recycling initiative has reportedly led to expenses rather than profits, as initially anticipated. The committee emphasized the necessity of reevaluating the program, considering its substantial financial implications. Some members argue that the program is essential for residents, particularly those on fixed incomes, while others believe commercial entities should manage their own waste.

The committee expressed the need for a comprehensive analysis before making decisions on related ordinances or operational procedures. Any definitive decisions regarding the recycling program should originate from the city council, with the committee providing data and insights. The sensitivity surrounding personnel issues was acknowledged, with an understanding that any changes to the program should not adversely affect the current workforce.

The meeting also touched upon infrastructure investments, emphasizing the need for grants to fund capital projects. There was acknowledgment of significant past investments, with concerns about the unpredictability of grant funding. The committee noted the potential financial burdens from ongoing projects like the fire station, police station, and seawall, expressing skepticism about expected federal funding.

A discussion about surplus management included the use of surplus funds for smaller capital expenditures instead of bonds, to save on taxpayer costs. The committee considered drafting a letter to the city clerk to formalize recommendations on surplus management, with consultation from the city attorney for legal insight. The necessity of a formalized approach to financial management was emphasized, accommodating both operational needs and long-term planning.

Finally, the meeting addressed housekeeping matters, including updates on committee membership and scheduling future meetings. The committee discussed starting meetings in January, maintaining a schedule of every other month, though adjustments for the summer schedule may be needed. An update on residential rental compliance was provided, with the clerk’s office working on transitioning to new regulations for 2025.