Multiple South Hadley boards gather to review the Budget Task Force report and discuss the next options for the town’s finances.
Photo credit: SHCTV15
SOUTH HADLEY — The South Hadley Selectboard officially set a Special Town Meeting for Wednesday, Feb. 25, at South Hadley High School after a Feb. 10 discussion with multiple town boards.
During the special meeting, South Hadley voters will weigh in on raising the tax levy further than currently allowed, but the decision will ultimately be made by the Selectboard. The meeting comes after months of discussions about the town’s budget deficits, which threaten to cut multiple positions and extracurricular activities in town.
After months of meetings, gathering data, compiling community surveys and hosting public input sessions, the Budget Task Force gave their final budget report on Feb. 9.
The Selectboard had discussed the possibility of hosting a Special Town Meeting to determine solutions regarding tax override options. That meeting is now official following the release of the task force’s report.
After deeming that the $3 million tax override option did not make a dent to the deficit and major cuts would still happen, the Selectboard approved four options for the FY27 budget scenarios: no override, a $6 million override, a $9 million override or an $11 million override.
The warrant includes three articles. Article 1 is to hear the report of the Selectboard relative to the findings of the Budget Task Force. Article 2 is to see if the town would approve a non-override budget and Article 3 asks if the town would approve an override budget.
Both the no override and override scenarios are listed in the appendix of the warrant. All the reports can be found at southhadley.org.
The Budget Task Force report focused on fiscal years 2027 through 2031.
The task force analyzed the town’s structural budget deficit. They reviewed multi-year revenue and expense trends, key cost drivers, growth constraints and the long-term financial outlook informed by detailed budget reviews, department consultations, capital planning input, peer community benchmarks and external research to evaluate multiple funding and override scenarios and their impacts on town and school services, expenditures and taxpayers.
The executive summary from the Budget Task Force stated, “the budget deficit is not attributable to a single issue; rather, it is the cumulative result of several decades of contributing factors.”
Following the review, the town anticipates encountering budget shortfalls of $2 million – $3 million annually over the upcoming three to four fiscal cycles. Significant findings include that maintaining current town and school service levels will require an estimated $9 million to $11 million over that period, absent new revenue sources.
For the South Hadley public schools, they require 4%-6% annual increases to cover COLAs, step increases and inflation; actual average growth over the last decade was 2.*%, resulting in cuts. School Choice losses total $3.1 million, driven by outdated funding formulas and increased post-pandemic participation. Special Education costs now represent 38% of the school budget which is up from 25% in FY17.
Between community surveys and the budget task force findings, there is support for an override paired with the transparent financial decision making, long-term fiscal stability planning, ongoing public engagement and education and strategic cost management to preserve essential services.
The report breaks down each tax override option, the number of years the tax levy will be raised, the dollar amount it would be raised by each year, the average monthly impact for taxpayers and budget impact and projected deficits.
The Budget Task Force mentioned that there is not one solution to overcome those problems, and the structural deficit will not be fixed by an override option alone. Each option still includes major or limited cuts and a budget deficit.
The South Hadley Budget Task Force has posted multiple videos on schtv.com to explain a proposition 2 ½ override, a tax levy and other terms. Previous meetings are also posted there.
The Selectboard also voted to dissolve the Budget Task Force since their work has been completed but thanked them for all the hard work they completed.
