Embedded Files
What is a Proposition 2½ Override?
Proposition 2½ is a 1980 state law that allows the total annual property taxes collected by a town (called the “tax levy”) to increase only three ways: 1) An automatic 2.5% increase on existing properties; 2) Assessments on any new growth in town (additions or new construction, for example); 3) A local election in which the voters “override” the limit, voting to authorize raised taxes by a certain amount. An override can be either a permanent increase, for revenue to pay annual operating costs (a “general" or “operating" override); or a temporary increase, called a “debt exclusion,” to pay for a town building project (such as Vinson-Owen School or WHS).
An operating override approved by voters raises the property tax “levy limit,” but does not automatically raise the "tax levy” billed for the next year. The $10M override voted by the Select Board is based on projected revenue needs over the next 2-3 years and the town does not anticipate raising the annual tax levy by the full override amount in the first year. For information on residential tax bill impact, see COSTS page. Click HERE more detailed information on property tax rate process and Prop. 2½, or HERE for a Mass DOR white paper on Tax Levy Limits.
Why is the town considering an operating override? Have there been any in the past?
The town’s annual operating revenue generated by property taxes -- together with state aid, local receipts, and other sources of funding -- is not keeping pace with the town’s expenses. Town operating expenses have been growing at an annual rate of 4.5% to 5.5%.
Over ten years ago, in 2007, the town passed an override for $1.347 million, and before that an override for $4.55 million was passed in 2002, $1.9 million for operating costs and $2.65 million for buildings and other capital costs, was approved. Several operating overrides proposed in Winchester failed to win approval -- 1991 ($924,000), 2004 ($3.933 million), 2011 ($1.44 million), and 2013 ($350,000).
Several debt exclusions have also passed to fund school building projects (Ambrose, McCall, Vinson-Owen, and Winchester High School), as well as for flood mitigation and improvements at Skillings Field. Debt exclusions raise taxes temporarily for the number of years it takes to pay off the project debt, typically 20 to 25 years.
Why are operating costs going up?
Winchester’s overall population has grown 7.5% in the past 10 years, and school enrollment has grown 17%, as the number of households with children has risen. As in many suburban communities, public education is the major component of the town's budget. Winchester schools have added staff to keep class sizes within guidelines and provide specialists (art, library, music, nurses, technology, physical education), meet requirements for English Language instruction and special education, and support student social and emotional wellness. Over the same period of time, the district also implemented technology and changing state curriculum frameworks. As part of the nationwide trend, the cost of employee health insurance -- for educators as well as other town staff -- has also risen.
Is school enrollment projected to keep going up?
In 2017, Winchester Public Schools completed an updated 10-year Facilities Master Plan that included an enrollment forecast showing continued enrollment growth through 2027. The town then engaged the University of Massachusetts Donahue Institute for Public Policy Research (UMDI) to review that enrollment forecast against regional demographic and economic trends. UMDI found Winchester’s overall population and number of households with children are both rising. UMDI concluded Winchester is among a small number of towns with excellent public schools, located within commuting distance of major job-growth areas in the metro-Boston region, and confirmed that sustained growth can be expected. Click HERE for the Donohue Institute Enrollment Validation Study.
What are the town’s sources of revenue -- besides property taxes?
Property taxes are the largest share of annual revenue supporting operations in Winchester -- over 76% of total revenue in Fiscal Year 2019.
The remainder is mainly State Aid, including education aid under Ch. 70, as well as Unrestricted General Aid (such as state aid to libraries among other types), 8.86% of total revenue; Local Receipts, which includes the motor vehicle excise (7.53%); and various other sources, some allocated to annual operations and some designated for other annual budget lines (like water & sewer or recreation department accounts).
Fall 2018 Comptroller Report (FY19) https://www.winchester.us/DocumentCenter/View/3218/Comptroller-Report---Fall-Town-Meeting-2018
What about State Aid, is it keeping pace with costs?
State Aid is a small portion of annual revenue. In Winchester's FY19 Operating Budget, State Aid accounted for just 8.86% of the total.
One type of State Aid, Chapter 70 aid to education, has increased, based primarily on the town’s growing school enrollment. Other types of aid, adjusted for inflation, are not keeping pace.
For more details on Chapter 70, see What is Chapter 70 Education Aid, and is it keeping pace with costs? , below.
What about additional property tax revenue from “New Growth”?
In addition to the automatic annual 2.5% increase to existing property tax, Prop. 2½ allows the tax amount to grow based on new properties (the "New Growth") built in town. However, Winchester’s tax revenue from New Growth is a small portion of annual revenue -- $904,093 in FY18 -- less than 1% of the budget.
While Winchester has made efforts to encourage mixed use or commercial property development, including the recent Town Center / Center Business District (CBD) rezoning, the town is predominantly residential with limited available land for new buildings.
What is Free Cash, and how much do we have? What is the “reserves policy”?
Free Cash is the term for the cash reserve of the town, which functions like a savings account. The cash has built up over time, from years when actual receipts were more than revenue estimates and/or there were unspent amounts in departmental budget items (called “reversions”). Free Cash is a “non-recurring” source of funds and should be restricted to paying one-time expenditures, funding capital projects, or replenishing reserves. Operating expenses (e.g., salaries & benefits) are recurring expenses.
Winchester has a financial policy (set by the Select Board) to maintain its reserves -- Free Cash and the General Stabilization Account -- at between 6% and 10% of total revenues. Having a substantial reserves balance is good policy not just for emergency expenses, but also helps the town maintain its credit rating -- its Aaa bond rating -- which enables the town to borrow at lower interest rates. Many of our peer communities hold substantial reserve balances as well.
Can Free Cash be used to close the operating budget gap?
Source: Fall 2018 State of the Town Report to Town Meeting
On the recommendation of the Finance Committee and management, Town Meeting has used modest amounts of Free Cash to balance annual budgets in the past, including $2.3 million of Free Cash for the FY19 Operating Budget. The remaining amount, along with other reserves, allowed the town to start FY19 with reserves at 7.99% -- within the 6%-10% range set by the Select Board's policy.
However, the amounts of Free Cash used to balance operating budgets have been climbing in recent years -- in FY16 $607,885 of Free Cash was used, in FY17 the amount was $1,082,939, and in FY18 it was $974,117. The Finance Committee has cautioned that continuing this trend would soon have a negative impact on the town’s credit rating (also called the bond rating).
What are the town’s overall operating costs?
K-12 and vocational education comprise over 42% of the Fiscal Year 2019 (FY19) Operating Budget, followed by benefits (e.g., health insurance for all town and school staff) at 14.48%; Public Safety, Dept. of Public Works, and Town Hall staff salaries (18.18%); then Energy (2.09%); and various other costs.
Note: Vocational education takes places outside the district at tuition rates set by the vocational school committees and not the Winchester School Committee.
Source: Fall 2018 Comptroller Report - FY19 Appropriations Chart
What town costs are increasing?
Salaries and benefits (premiums for employee health insurance in particular), have been increasing.
The cost of health insurance for school department staff is consolidated with all other town departmental staff in the budget (not broken out and allocated to the school department).
For school costs, see below.
Source: Fall 2018 Comptroller Report
What about the town's energy costs?
The town's Energy Management Committee, working with the DPW, have made energy-saving improvements in various town and school buildings.
For school costs, see below.
Source: Fall 2018 Comptroller Report
Energy Costs FY10 - FY19
Source: Fall 2018 Comptroller Reporthttps://www.winchester.us/DocumentCenter/View/3218/Comptroller-Report---Fall-Town-Meeting-2018What are the schools' funding sources?
Winchester Public Schools’ primary funding source each year is the town annual budget appropriation -- 77% of the school budget in the 2018-19 year (FY19).
State Education Aid under Ch. 70, other federal and state special education funding (like the state “circuit breaker”), and user fees charged to families for transportation and extracurricular athletics are other sources.
What are the schools' operating costs?
Salaries & benefits for teachers, specialists, and special education educators, as well as principals and central office administration, are the primary annual expense followed by special education (tuition & transportation costs for special needs students attending out-of-district programs).
Health insurance for school district staff is consolidated with all other town departmental staff in the budget (not broken out and allocated to the school department). The state's calculation of per pupil spending does include benefits and other amounts, listed in other budget lines, that support school operations.
What specific school costs are increasing?
Winchester's enrollment has been rising steadily for over ten years, with numbers of teachers rising to maintain reasonable class sizes. Enrollment this year is over 4,600 students. Educator salaries as well as the cost of mandated services, such as English Language instruction and special education, are also increasing.
Mandated special education costs rise as the number of students in the district with individual education plans increases; the district is also responsible for tuition and transportation costs for students in out-of-district programs. State and federal special education reimbursements are limited and are not keeping pace.
What types of services do special needs students receive, and are costs increasing?
The majority of WPS students with special needs attend school in the district, while 6% attend out-of-district programs. Mandated special education costs are rising as the number of special needs students increases with enrollment, and as the cost of tuition and transportation for students in out-of-district programs goes up.
Click here for more details.
Source: Fall 2018 Comptroller Reporthttps://www.winchester.us/DocumentCenter/View/3218/Comptroller-Report---Fall-Town-Meeting-2018
What are the schools doing to try to manage rising special education costs?
Town Meeting established a Special Education Reserve Fund (currently $312,020), which is set aside to be used for unanticipated and un-budgeted special education costs.
In addition, the district has started several in-district "substantially separate" programs for students with certain diagnosed needs, for example a language-based disabilities program. These programs allow students to stay "in-district" while also reducing costs that would otherwise be incurred for tuition and transportation.
How does education spending in Winchester compare to other districts?
The Commonwealth's school finance law, MGL Ch. 70, establishes an annual "net school spending" requirement for each Massachusetts school district. To enforce this requirement, the Dept. of Elementary and Secondary Schools (DESE) requires all districts to report all local, state and federal financial support they receive annually. The year-end report includes local expenditures by other municipal departments that support the district (e.g., utilities, building maintenance). See DESE regs. 603 CMR 10.06
State Average vs WPS Per Pupil Expenditures 2007 - 2017
Source: MA Dept. Elementary & Secondary Education (DESE)Based on this data, DESE each year calculates all districts’ “Per Pupil Spending” and publishes statewide data online. Typically, municipal appropriations, approved annually by cities and towns, account for seven out of every eight dollars spent on education, according to DESE.
Based on this state data, spending per pupil in Winchester (shown in this chart by the yellow line) has been lower than the state average for all districts (the blue bars) for many years.
For DESE's Report Card on Winchester's latest Per Pupil Spending, click HERE
Winchester Town-wide Staffing
Source: Select Board Report Fall 2018 Town MeetingWhat has the town done to reduce operating costs and manage the budget?
The town has limited staffing in the public works and public safety (police and fire) departments and, to better manage building maintenance/capital needs, the town annually sets aside money in two separate stabilization funds to maintain buildings and capital equipment.
What has been the impact of limited funding on the schools?
Winchester Schools’ below-state-average per pupil spending level noted above reflects a number of factors, including a below-state-average educator salary level, limited administrative staff, gradual integration of technology, limited curriculum planning or improvement, and constrained funding for materials and books. Full-day kindergarten teacher aides are part time. Middle school after-school activities and elementary field trips are funded with donations. In addition, user fees are charged to students' families for bus transportation, high school athletics, and elementary instrumental music lessons.
What needs have been identified, what would the additional revenue accomplish?
In general, Winchester needs to attract and retain high quality staff for schools, public safety & emergency response, DPW, and general government services, at the level needed for the town's growing population; to maintain roads and other municipal infrastructure, school and town buildings, fields, and other capital assets; and complete the flood mitigation program.
For example, the Select Board and Town Manager identify needs for police/fire emergency dispatchers and firefighters to meet national standards, and for traffic safety improvements.
The School Committee and Superintendent identify needs to keep pace with enrollment growth and maintain class-size guidelines (at K-5, below 22 and at grades 6-12, 25), for staff and professional development to support student emotional health, to meet mandates like English Language learning and special education, and for curriculum improvements like world language expansion.
Source:Fall 2018 Town Meeting Select Board Report
What happens if the override does not pass?
Without additional annual revenue now, the town faces a difficult choice:
- Deplete reserves -- risking higher borrowing costs (leaving less revenue for annual operations or emergencies), or
- Reductions in staffing and the quality of town services.
What are the requirements for Special Education, and how have they changed?
All Massachusetts public school districts are required to provide every student a free and appropriate education in the least restrictive environment under the provisions of MGL Ch. 71B and the federal Individuals with Disabilities Education Improvement Act of 2004 (IDEA). Special education laws originated in the 1970s. IDEA was enacted by Congress in 1990 and substantially amended in 2004 with a focus on including special needs students in the general education setting. Click HERE for more information on IDEA 2004.
Special education students have an individual education plan (“IEP”) based on their diagnosed needs, or an accommodation plan pursuant to related disabilities laws (a “504 Plan”). For some students, the least restrictive learning environment is the general education classroom where a special education teacher as well as a regular education teacher instruct the class (“co-teaching”) or where the student receives services from an teaching assistant; for some students it is receiving special services in a learning center or from another specialist (like a speech pathologist) outside the classroom, while for others it means attending a substantially separate program in the public school or attending a full-day program in a specialized school is most effective (an “out-of-district placement”). WPS is required to pay for transportation and tuition for out-of-district students. WPS also provides several substantially separate programs within the elementary and middle schools, including language-based disabilities programs at both levels.
Special Education laws also require districts to have a preschool program where special needs students receive instruction in a class with typically-developing peers -- called an “integrated preschool.” (Families of typically-developing students pay tuition.) WPS is also required to provide services to special needs students through age 21, if appropriate.
What is English Language instruction?
By law, all students are screened as part of the public school registration process, and the district is required to provide English language instruction, as appropriate, for all “English Language Learners.” The number of English Language Learners in the Winchester schools has grown in the past 10 years. This year over 16% of WPS students’ first language is not English, and 3.5% of WPS students receive language instruction as English Language Learners.
What is Chapter 70 Education Aid, and is it keeping pace with costs?
Chapter 70 is part of the state's 1993 Education Reform Act, and the primary state program for distributing aid to public schools. The Commonwealth’s constitution requires total K-12 spending in each district be the amount needed to provide an adequate education to its students, the so-called annual “foundation budget.” The Ch. 70 foundation budget is based on a standard set of education cost categories (incl. teacher salaries, building maintenance, curriculum supplies, among others) and the district’s K-12 student enrollment.
Once a district’s Ch. 70 foundation budget is established, the state then calculates a city or town’s ability to contribute local revenue to support its schools. In Winchester as in many districts, the actual amount spent to operate the schools annually exceeds the Chapter 70 foundation budget, but a minimum state contribution to every district is currently required.
It is widely recognized that Chapter 70’s foundation budget formula is out of date. The state legislature’s Foundation Budget Review Commission (FBRC) in 2015 identified employee health insurance and special education as the local budget components most significantly underfunded by Chapter 70. As the FBRC recommendations are implemented, the town’s foundation budget and Chapter 70 allocation can be expected to change.
Click HERE for the Massachusetts Budget and Policy Center's, “Demystifying the Chapter 70 Formula”
Click HERE for the Massachusetts Budget and Policy Center's "Building an Education System that Works for Everyone: Funding Reforms”
What is Winchester's Flood Mitigation Plan, and what projects are left to be completed?
After multiple widespread and severe flooding events in the late 1990’s, Winchester coordinated with other municipalities along the Aberjona River to investigate, design, and build projects to improve the river’s capacity and ability to handle larger storms. A total of 13 projects were designed for Winchester, and a full Environmental Impact Study was completed and approved in 2010.
Finished projects include widening the channel along Mystic Valley Pkwy, improvements to the Mt. Vernon Street bridge, and the added fourth culvert (w/needed environmental remediation) at Skillings Field. Fall 2018 Town Meeting appropriated $2.8M for the Swanton Street Bridge project. The last remaining project is the railroad bridge behind Muraco School. Click HERE to learn more about Winchester's Flood Mitigation Plan.
Flooding on Cross Street, March 2010
Source: Town of WinchesterGoogle Sites
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