Orleans Readies $51.1 million Operating Budget

ORLEANS – Town officials have prepared a $51.1 million operating budget for the new fiscal year, which represents an increase of just under 12 percent from the fiscal 2024 budget.

The rising cost of utilities and a significant increase in Orleans’ share of the Nauset regional school budget are among the biggest drivers in the new budget, which currently sits at $51,179,356.

The select board board and finance committee pored over the most recent iteration of the budget in a lengthy joint hearing on March 13. While the projected increase is driven by forces beyond the town’s control, some finance committee members raised concern with what they saw as a growing trend of annual double digit budget growth in recent years.

Among the notable increases outlined in the new operating budget include an additional $360,000 set aside as a reserve for contract negotiations. Town Manager Kim Newman said the town will be negotiating with three of its unions in the new fiscal year, but that the line item will be reduced significantly to about $50,000 in fiscal 2026.

Pre-kindergarten Budgeted At $300,000

The budget also includes $500,000 for the finance committee reserve fund, a figure up significantly from the current $80,000 allocation. Newman said some of that funding could be used to provide additional money as needed to the town’s pre-kindergarten program, which was initially funded through a Proposition 2½ override of $495,000 at the special town meeting in October 2021.

The pre-kindergarten funding has been moved into the operating budget at $300,000, with Newman noting that to date, the program has not eclipsed $260,000 in annual expenditures. But Constance Kremer of the finance committee sought assurance last week that the program will be fully funded if its annual costs exceed the budgeted amount.

Discussion was also given to expanding the program in the future. That could include offering the program year-round and growing its services.

“I think I’ve made it clear that one of the biggest challenges we have is retaining and attracting young families, and in all of this budget, this is really the biggest thing that can actually attract and retain young families,” said Select Board Chair Michael Herman.

Andrea Reed of the select board noted that it was the board that requested that the funding be sought to create the pre-kindergarten program, and as such it’s the select board that should take ownership of any plans to grow or expand it. But board member Mark Mathison said it will take the involvement of many groups to help grow the program, including the Orleans Elementary School committee.

“This is something that we need to do, but this has got to be a coordinated effort,” he said. “And as of right now, there has been no coordinated effort.”

Fiscal Restraint Urged

Ed Mahoney of the finance committee noted that the proposed FY 2025 budget is the first in the town’s history to exceed $50 million. It also marks the third consecutive year that the operating budget has risen more than 10 percent from the prior year.

Noting that the town’s police and fire budgets only increased by about 1 percent from the current fiscal year, Mahoney urged town officials to apply the same restraint in preparing future operating budgets.

“Like a family, we have to make tough spending decisions,” he said. “We cannot spend beyond our means, and we cannot do everything.”

Mahoney said that after funding for public safety, education and debt service requirements, only 40 percent of the proposed funding is left to finance all the town’s other programming and services.

Orleans’ share of the Nauset regional school assessment for FY 2025 is $8,361,124 million, an increase of approximately 21 percent. The increase is in part due to debt from the ongoing regional high school construction, which is due to come online in the new fiscal year.

The budget also includes $8,015,869 in overall debt service, an increase of 12.8 percent. Having moved from a community where the tax rate is “going out of sight,” finance committee member Tony Pearl expressed concern over how debt connected to projects mapped out in the town’s five-year capital improvement plan will affect taxpayers.

Reed said the town’s five-year and long-term capital planning procedures include “guardrails” for how “wishlist” items evolve over time into town needs that are eventually funded.

“We are, I would say, one of the best fiscally managed towns I have ever lived in of any size,” she said.

Mefford Runyon of the select board also pointed out that while called a capital improvement “plan,” there is no guarantee if or when projects will ultimately be brought forward for funding.

Enterprise Funds To Be Evaluated

Lynn Bruneau of the finance committee said that the committee plans to give the town’s existing enterprise accounts “a fresh look” in the new fiscal year. That includes determining which accounts should stay in the operating budget and which should not.

The enterprise accounts went into effect in July 2021 as a means of generating and tracking revenue for specific town projects and initiatives. Orleans resident Alan McClennen supported evaluating the existing enterprise accounts to assure that they’re living up to their intended purposes.

“Let’s really take a hard look at them,” he said. “They tell the voters how the money is being spent. We need to figure out how to make them so that they work as enterprises.”

Kudos For Town Manager

McClennen noted that the proposed fiscal 2025 budget is double that from 2015. But even with the projected increases, officials applauded the work done by Newman in preparing the budget in her first budget cycle as town manager.

“Our town manager did an excellent job putting this 2025 and prior year operating budget together,” Mahoney said. “It’s comprehensive, it’s clear, it’s understandable. Great job.”

Newman said she plans to bring more efficiencies to her budget planning process in the future, including consolidating line items into categories to make the budget easier to understand.

Email Ryan Bray at ryan@capecodchronicle.com