How is Weston doing?

2. How is Weston doing? During a difficult economy: • Rate of salary increase was reduced • Reductions made in health insurance costs • Added to reserves • Continued to fund facilities and public works infrastructure • No cuts in service

3. What do we need to watch? Going forward: • Debt service from previously approved capital projects will hit the tax bill. We must do our best to keep operating budget increases as low as possible • Next round of collective bargaining with employee unions is critical • Unfunded pension and OPEB liabilities

4. Revenue

5. Financial Indicator 1 – Revenues per Household A decrease in net operating revenues per household (constant dollars) is considered a warning indicator.

6. Financial Indicator 2 – State Aid Reductions in State Aid as a percentage of operating revenues is considered a warning indicator, particularly if the Town does not have adequate reserves to offset reductions.

7. Financial Indicator 3 – Revenues Related to Economic Growth Decreasing economic growth revenues, as a percentage of net operating revenues, is considered a warning indicator.

8. Reserves

9. Financial Indicator 14 – Reserves/Fund Balance Declining reserves as a percentage of operating revenues is considered a warning indicator. GFOA recommends that undesignated fund balance be 5-15 percent of operating revenues.

10. Expenditures

11. Financial Indicator 6– Expenditures per Household Increasing net operating expenditures per household, in constant dollars, may be considered a warning indicator.

12. Financial Indicator 7 – Salaries and Wages Increasing personnel costs as a percentage of total spending is considered a warning indicator.

13. EmployeeBenefits

14. Financial Indicator 10 – Pension Liability (MRS) An unfunded pension liability or increase in the unfunded liability is considered a warning indicator. *FY2012 figures will be available in January 2013

15. Financial Indicator 11 – OPEB Liability An unfunded liability for post employment benefits or increase in the unfunded liability is considered a warning indicator. Annual Required Contribution (ARC)

16. Debt

17. Financial Indicator 12 – Debt Service Debt service exceeding 15 percent of operating revenues is considered a warning indicator by the credit rating organizations.

18. Financial Indicator 13 – Long Term Debt Warning indicators: Overall debt exceeding 10 percent of assessed valuation Overall debt exceeding 15 percent of per capita income

19. Population

20. Financial Indicator 15 - Population Rapid changes in population which may affect service levels may be considered a warning indicator.

21. BudgetProjection

22. Budget Projection FY2014 Assuming a level service budget, we are projecting a budget gap of approximately $379,000 FY2015 Assuming no significant improvement in the economy, the budget gap is projected to be approximately $493,000 FY2016 Assuming a slight improvement in the economy, the budget gap is projected to be approximately $471,000

23. Impact on FY2014 Tax Bill Assuming FY2014 shortfall is closed through expenditure cuts or increased revenue, then projected operating budget increase plus the increase in exempt debt service = overall 5.7% increase in tax bill.