2026-10-26 - Assembly Finance Committee

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03:54Mhm.

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04:22that the Standing Committee on Finance may

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04:37Yes, Mr. Clerk. Please proceed with the roll call.

04:48Delegate Gallagher? Here. I do know that Do Do

04:54Delegate O'Malley? Here. Uh Chair O'Malley? Uh

05:01Chair Killian? Here. And I do see Delegate King as

05:08you've got a quorum. Thank you, Mr. Clerk.

05:13a discussion regarding the potential transfer of

05:18to stabilization fund under resolution 26-08. And

05:29I don't see anyone else. So, uh Mr. Administrator,

05:38I would be happy to. So, I appreciate it. Um

05:47not being able to make the meeting. She's well,

05:54I am here. I do appreciate this discussion because

06:01I'm really adamant that the county protect its

06:09unreserved fund balance is placing that into

06:20we have [clears throat] currently we have 1 2 3 4

06:30five. Sorry, five stabilization funds. I could

06:39I don't think that's the I don't think that's the

06:47when we as soon as we get the auditors essentially

06:58then I think we want to make sure that we're

07:04balance to stabilization. One of the things that

07:11is um [clears throat] making sure that we we

07:19So, our revenues come in unlike towns on a very

07:27mostly quarterly basis for most towns.

07:32Our expenditures continue relatively stable for

07:39fiscal year. So, in the first part of the fiscal

07:46mostly to cover, um, our retirement

07:53uh, various things that that we get a discount,

08:01we spend those funds early in the fiscal year to

08:06dollars, give or take. Um, we don't see that

08:15January time frame. So, I know, uh, in order for

08:24because why would we? Why would we expend the

08:30borrowing, uh, we want to make sure we've got

08:36to be able to cover some of those significant

08:42um, so, aside from that, you know, as I

08:48uh, their work on for this FY26, uh, complete

08:57um, I, I will be, uh, certainly

09:02allocate money into, into stabilization.

09:10anyway, general stabilization, capital

09:14fund referred to as emergency stabilization,

09:20stabilization, and we've got PFAS, uh, a PFAS

09:28the law changed in Massachusetts a number

09:33specific stabilization funds for very specific

09:41revenue stabilization um all make a lot of sense

09:49the difference between general stabilization

09:56you know, when when I worked on a town level,

10:04tap a fund in the event of a an what an emergency,

10:12your local receipts, or a dramatic decrease in

10:19so that was the purpose of general stabilization.

10:25stabilization was created uh back in 2020, that

10:31history of that. That may have been a result of

10:38of exactly what the purpose was of emergency

10:47I don't know right now the balance hovers around

10:54I probably would not recommend putting more money

11:02just sort of my my outlook on things. Um but I

11:10a good uh destination for a chunk of funds. I

11:1880 million dollars worth of deferred capital. We

11:24those deferred capital needs um without uh again,

11:32state reimbursement for some of those. Um,

11:38capital stabilization. Uh, I think you've got

11:46pushing almost 15 million. And uh, and PFAS

11:56Mayor Ben Paul or or uh, Paul Rosala or

12:02one of the last meetings that we don't really

12:08obligation will be. But right now it's it's a

12:17Um, there there is no way to essentially

12:24the contamination PFAS contamination. Um, so we've

12:33analysis, you know, research uh, when it comes

12:41such a moving dynamic I think at this point that

12:49or or even approximately what uh, our our total

12:56So, so I guess that's my long way of saying um,

13:05uh, you're on the right track. I'm on the right

13:10uh, allocate some of these unreserved fund

13:15Um, and you know, those are basically my

13:22capital stabilization I think are are going to

13:30So, um I I don't see anyone with a with a

13:36you you know, you mentioned about um sort of end

13:41quarter as um a time when we do disperse funds

13:48and you want to be able to use the funds in

13:54correct? Is that that what you No, that's

14:00Once you put that money into stabilization, we

14:05best way to think about it. But you want to make

14:10sure that for that period of the year where we've

14:15beginning of our fiscal year we want to make

14:21um in, unres-left in unreserved fund balance,

14:26once that Once we bridge that and we get into

14:33know, then it's a different story. Then then we're

14:38for the cash flow. If that makes sense. It it

14:44of of stabilization funds we have. Do you see a

14:50remember we've had discussions about the creation

14:54I think it was done as a way to sort of track

14:59you know, specific things were coming out of a

15:04stabilization, and it made it a little

15:08to provide the funds that we were anticipating

15:15would you pare that down in some way to

15:21Uh Uh, that's a That's a great

15:26I think setting up a stabilization fund for

15:32cities and towns have cried out for that for,

15:39uh, legislation state legislation back in the

15:46for cities and towns to do that. And, and so we,

15:51thing. Um, I only question, you know, that what's

15:58between general stabilization and emergency

16:03in my book should not ever be touched uh, unless

16:10could be an economic downturn severe enough to to

16:18again, you have to define that. You know, that

16:24a stabilization fund is defining how you're

16:31seems to me to be sort of duplicating what gen

16:37I think as you mentioned I think that

16:41in the Delaware Valley can probably remember it

16:45COVID that that we that we created that fund and

16:51Anyway, I will stop talking and I will unleash the

17:00I don't know if I like the

17:05phrasing here uh but let me I've got a few things.

17:13state the different stabilization funds but I

17:19for me, um without going in more depth about this,

17:28an overlap of the general fund, the emergency,

17:34so, I mean, revenue stabilization is there in

17:38that can happen in general, too, all right?

17:44at another meeting, but I think all of us are

17:49let's deal with the transfer of funds to because

17:56uh not too long ago. And um there seems to be

18:05Mr. Dutton, we got your input on that.

18:09about how we deal with this, and we had

18:14not again, it wasn't an automatic. It was the time

18:21We can't set up something automatic. So, that

18:26and we said when it exceeds 15%, and we got

18:32the administration put in its budget book, which

18:38all right? So, we didn't pull these

18:42Now, if we're going to look at this, though, we

18:47hearing from you, it sounds as if you're saying

18:54uh problem until somewhere January, February. So,

19:01good date to try to make this transfer or to even

19:06that now that we're looking at it again. But, the

19:13to that, you you mentioned we shouldn't perhaps

19:18are we talking about waiting until the auditors

19:25before we think about the transfer? Because

19:30Um I don't I don't think we're going to have an

19:38or rather the FY 26 fiscal year,

19:44the audit shouldn't take until uh should not take

19:50you know, to get the auditors in here to have

19:55have a discussion with the commissioners.

20:00for the most part, completed or much earlier than

20:05that that that audit is important to us is that we

20:12every city and in town, the Department of Revenue

20:18with counties. So, so we rely on the auditors' uh

20:26uh to make sure that we we have done everything

20:31everything right in terms of, you know, the

20:38uh I don't want anybody relying on what I say to

20:44balance and transfer that into stabilization. Um

20:50uh opine on that and make sure that that, you

20:56certified, which is a municipal term, but for lack

21:02auditors have certified uh what we have so that

21:08where we're putting it. Um so that that's, you

21:15go back and look. I know uh that September 15th

21:23there was some definition confusion about the 15%.

21:32municipal in the municipal world is the 15%10 to

21:39is kind of a target. Um and auditors will tell you

21:45Um it making sure that that stabilization fund

21:56fund budget in the municipal world is kind of

22:01and look, but I I do apologize if there was some

22:0715th date came from came from us, I you know, we

22:15um, I think the important part is that, you

22:20making sure that once once we "quote unquote

22:26once we certify our free cash (to put

22:30um that, that that money is spread spread

22:37that we all think are the the appropriate ones to

22:45I think the 15th date did come from you,

22:50what where it came from, etc. I'm here to talk

22:56to me, we do need certain things out to do

23:00whenever anyone turns around and thinks about

23:05All right, that's not right. So, we need to have

23:12So, you're suggesting one of them is we wait till

23:18I'm a familiar with municipal financing as well.

23:24Revenue certifying is our auditors. But, I I'm

23:32you're telling me it's sooner than that that

23:37financials. Is it March? Do you have an idea when

23:44it's in the February-March time frame and I I

23:50policy and I I don't think that this is referenced

23:54I would not object. In fact, I could bring, you

24:00but I certainly wouldn't object to uh developing,

24:05you know, based upon exactly when the

24:10um, and when, when the, the commissioners

24:15on a transfer into stabilization. I, I think

24:21Yeah, and and I think so, too. All right, um

24:28thinking about? Is it Does it make sense to say I

24:34of 15%of the operating budget. So, we're

24:42undesignated general fund balance as a cushion on

24:48Maybe there's a better metric and um for us to use

24:56All right, a target for what the amount

25:03ought to be the at least target starting point

25:11stabilization fund buckets. And I think before we

25:18what those buckets are. All right? And then we can

25:24is there something you you could come back to us

25:29sit down and and have a revise our resolution

25:36assembly can work can live with. And we're all

25:42Absolutely. I think I think um in fact, I

25:51well, we are working on general update

25:56make sure that this is one of them. Um but

26:01sort of readdress that uh that

26:07I can come back to you with some policy

26:15Uh Delegate Mally, you had your hand up but

26:19to have some comments, questions? I did. I think I

26:25it but I uh in listening to Administrator Guttman,

26:32clearly uh under what circumstances each of these

26:40aware here that there's you know, the emergency

26:45emergency fund if uh our general revenues from

26:51general that's the revenue reserve [clears throat]

26:56get really clear about what are the margins of

27:01That would because otherwise we're going to

27:05a transfer. And it would be quite [clears throat]

27:10from that bucket. That's all. And I think Delegate

27:17Uh Clerk Fletcher, your hand is up.

27:21Um I'll try to be brief. I believe it or not

27:29Administrator Dutton, when this got passed

27:34and I couldn't remember why there were two. And I

27:39day that the Assembly passed it for a previous

27:44I could see our vice chair saying, "I prefer

27:49more than one." I still couldn't

27:54that um ratings agencies like to see these

27:59which is why we have a PFOS one and a capital one.

28:04emergency and that. I I do remember at the time we

28:10other things that were going on. I think the sense

28:16a true emergency before you would you would raid

28:22would use the general stabilization fund to

28:27there was an idea that well, if we have to have

28:33that that's the fund for that and the rest

28:39if you were hoping that as a clerk the archive

28:45Just just just thought I'd throw that in

28:50Well, look Fletcher, I mean I again I think going

28:57was a matter of putting limited funds in these

29:02"Oh, we've got all this money in this account.

29:07capped. So it will be used for a specific

29:16pre-COVID, I mean it was a million dollars, I

29:24And if you can remember this

29:29when the county had built up a significant

29:34increases in valuation real estate. So Um you've

29:39O'Malley has as well to remember when the idea of

29:45funds would have been ludicrous because we

29:50I didn't want to intervene in the debate. I

29:54on it faster than I thought and didn't find what

29:59that I that I couldn't find a a definitive

30:05Deputy Speaker, your hand is up again. Yeah. Yeah,

30:10makes me more in favor of what Delegate O'Malley

30:17and and we need to put down a very easy history

30:24question what what why what were we thinking then?

30:30and in this budget cycle we've got to do

30:35from undesignated into stabilization funds, this

30:41think it's what it needs. It needs to be tightened

30:47Um and perhaps um as I said before, uh too many

30:54overlap of some of this. So, let's let's get it

30:5910 years from now, people sitting in our seats can

31:05record as to what that was for." Um rather than

31:11I went back and I couldn't really tell. Um that's

31:18So, given that your your suggestion being uh you

31:23looking back. But ultimately, the goal is to just

31:31to understand. Yeah, if we don't Yeah, we don't we

31:36make it and I don't think we can get lower than

31:42but I mean, three or four, but it's certainly

31:50questions? I don't see anybody with a hand

31:55Uh Delegate King, do you have

31:59an alternate on this, but you're

32:05Uh no, I I I I really don't have

32:09I I'm just wanting to listen in and and and and

32:15Okay. Well, well, you can, but it seems like

32:21Um Administrator Dutton, do you have anything

32:28would like us to discuss in the future? Where What

32:32as? Um I think I think given uh the invitation uh

32:39uh or I would propose drafting some some policy

32:47and purpose. And as I think uh uh Delegate

32:54right metrics or developing the right metrics

33:02And I think in the in the meantime, we'll

33:08at least when they were created back in

33:132020. We'll try to figure out, you know, what

33:19any history on that. 2020 unfortunately

33:25so it's challenging to try to find some history to

33:31you and the commissioners with some policy around

33:38it will be), well, we can adopt that and be a

33:44how we're going to save the money and then

33:49So that's what I I will do. And if I might

33:55I think that the timing issue on the undesignated

34:01Uh since you we want I'm sorry. Because you

34:08when these allocations are going to be made

34:14as you know, what percentage of of our

34:20for each of the stabilization funds. And and

34:26decision to override policy, but you know,

34:34So administrator Dalton, what sort of time frame

34:39you know, coming up to the end of the

34:42want to going to want to try and

34:47I would say the short answer is yes. I would

34:52a consensus within the next 30 days and we have as

34:59to the financial policies already. So I don't

35:05internally. So So I don't why don't I make that

35:11resolved and back to the finance committee

35:18Any other comments, questions regarding timeline

35:27And I see absolutely none. If there's nothing

35:33Excellent. Thank you everybody. Very

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