Stoneham may trash... the fee

For more than a decade now, talking trash in Stoneham has heaped controversy and division like few other issues in town.

And with citizens this month being asked to raid Stoneham's $3.4 million in free cash to eradicate the town's trash fee, the start of 2018 has proven no exception to that trend.

Publicly opposed by Stoneham's Board of Selectmen, Finance Board, and School Committee, the trash fee initiative, to be voted upon by Town Meeting members next Monday, will eliminate the $145 yearly fee assessed to single-family homeowners for weekly curbside trash pickup and recycling. Condo owners are also charged a reduced fee of $90 for the service, in which residents are limited to throwing out 90-gallons of refuse each week.

The garbage charge, imposed to thwart a financial crisis that threatened to wipe out Stoneham High School's athletics programs which would result in mass layoffs in 2012, was enacted seven years ago as a temporary fee. At its inception, the trash charge was set at $252 per household, but it has been slowly reduced since that time.

Proponents of eliminating the fee say town officials, sitting on the largest pile of surplus revenue in recent memory, are unfairly hording the free cash with the intent of boosting reserve account savings. However, detractors of Article 22 say Stoneham, just about to emerge from an era of instability that rocked the community throughout much of the 2000s, is best served by shoring up its financial foundations.

"This is a mistake…I do not want to see us reverse 10 years of work that the School Committee and Board of Selectmen did to get us back to this point. We don’t want to go back to those days,” cautioned Selectman Shelly MacNeill during a meeting in late March.

“I think you should just let the people decide how to spend their money,” Selectman Caroline Colarusso, the lead proponent of the trash fee break, commented earlier this month.

A trash fee ‘holiday’

Earlier this winter, after town leaders discovered the Mass. Department of Revenue had certified the largest amount of surplus revenue in the community since the 1980s, Colarusso and recently ousted Selectman Thomas Boussy, the board's elder statesmen, demanded a portion of the unexpected windfall be allocated towards a rubbish fee break.

Stoneham’s $3.4 million in free cash, generated through the collection of revenue that exceeded initial projections for the current fiscal year, is by far the largest amount of surplus funding generated in the community since the turn of the new millennium.

In fact, the figure is nearly three times the $1.14 million collected in 2015. It is the highest free cash total over the past five fiscal years. Since 2013, Stoneham’s free cash has only twice surpassed the $1 million mark.

“Back eight or nine years ago, we were looking at deficits, the cutting of sports and police officers, and a lot of other [budgetary issues]. We’ve cleared that hurdle,” Former Selectmen Boussy, who a few weeks ago lost his seat in municipal elections, responded in January.

“[Collecting a trash fee] is now becoming a tax override, because it’s not needed to cover a deficit anymore,” the former selectman further contended. “We shouldn’t be asking seniors and people on a fixed income – or anyone else for that matter – to pay this trash fee.”

However, the veteran board members were immediately rebuked by Town Administrator Thomas Younger and their selectmen colleagues, who in a 3-to-2 vote, opposed what they described as an impetuous reaction to the free cash announcement.

Weeks later, a defiant Colarusso, who has rallied against the trash fee ever since being elected to office in 2015, set out to collect signatures from residents asking for a Town Meeting vote on the issue anyways.

What resulted is Article 22 of Stoneham's upcoming Annual Town Meeting on May 7, which seeks to drain $1.1 million or roughly one-third of the free cash for what supporters have declared as a "trash fee holiday.”

At risk, according to fiscal hawks like Younger, is Stoneham's future financial stability.

Specifically, the town administrator, who has tried to break the community's practice of relying on one-time funding sources for reoccurring expenditures, has suggested such impulsive spending habits likely caused the dire budget conditions that led to the imposition of the annual refuse charges some seven years earlier.

Rather than offer a discount now, Younger and opponents of the fee break contend Stoneham is better off building up reserves and waiting to see if the upward trend in free cash revenues is stable. Otherwise, they warn, residents may find themselves assessed a new fee a few years from now, which may be set even higher than today’s $145 rate to account for the budget’s overreliance on one-time free cash allocations that have since dried up.

"My philosophy is before you spend free cash, you have to make sure there's a standard. You should have [historical data] showing you're getting at least that much [on a year-to-year basis]," said Younger during a free cash discussion last January. "It's one thing to use free-cash for one-time expenditures like capital, but if you use it on operating [expenses], you may run into problems with future budgets."

Based upon Stoneham’s proposed $70 million budget for FY’19, the municipality will collect roughly $467,000 in private fees from residents to subsidize Stoneham’s annual waste hauling costs. That revenue will be further coupled with some $115,000 in funding generated from the tax levy, bringing the total cost for refuse pickup in FY’19 to around $582,000, according to budget documents.

Those projections for next year show an overall drop in trash service costs from FY’18, when some $525,000 was collected through the trash fee and another $135,694 was contributed through taxation. The proposed use of $1.1 million in funding for refuse charge offsets, based off of those figures, should be sufficient to extend a break in the charge for at least two years.

Déjà vu?

According to Younger and other town officials, local citizens unpersuaded by their warnings should examine Stoneham’s short-sighted use of reserve funding last year to offer a similar water and sewer bill discount to ratepayers.

Against his initial instincts, Younger last April succumbed to pressure from the Board of Selectmen to tap some $2.3 million in water and sewer enterprise fund reserves to reduce ratepayers’ bills for the second consecutive year.

Similarly enacting the rate reduction after being prodded by Boussy and Colarusso, the town administrator had just months earlier made a familiar argument: That the extra funding be used to build-up a financial cushion until town leaders were sure operating costs and incoming revenues were stable.

However, facing significant pushback from a majority of selectmen (two of whom no longer sit on the board), the grizzled municipal manager instituted what was supposed to amount to $55 discount to ratepayers annual bill.

Just weeks ago, local residents learned that gamble was about to hurt their wallets in a big way, as a mid-year deficit of $200,000 had sprung up. As a result, Stoneham ratepayers were going to see water and sewer rates spike by an unheard of $4.30 for the last quarter of FY’18.

In order to contain the spread of that pricing hike, which will still carry over in the form of higher rates in FY’19, the last minute scramble will also result in the complete exhaustion of all remaining water and sewer enterprise fund reserves.

“If we had done this over a one-year period, the average would have been about $18 to $19 per quarter,” said the town administrator, who estimated the average household should see a $75 spike in their last water and sewer bill of the year.

“If the FY’18 rates were set the way they should have been, the FY’19 rates would have actually been going down,” new Town Accountant David Castellarin later told shocked members of Stoneham’s Water & Sewer Review Board. “The things that were being done in the past [were wrong]. We have to get everything back on track.”

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