By Elizabeth F. McNamara
During his report to the Town Council during Monday night’s virtual meeting, Town Manager Andrew Nota said the town might need “short-term layoffs” of six months or so in response to expected COVID-19-related revenue declines.
On Tuesday, Nota expanded on his comments, noting that time would depend on “a number of variables we don’t yet have answers to.” He added, “I did not say the word ‘layoff’ lightly. But I think it was very important to say it … important not only for the community but for our employees to know that everything’s on the table.”
Nota reiterated what he’s been saying for months: “We do not have a deep bench” when it comes to town staff and the ability to deliver services, hence his expressed desire for only short-term layoffs, if any.
“If we need to hedge the uncertainty in terms of revenue and tax collections and business in general, we’ll hedge,” he said. “My first loyalty, our entire loyalty [as town staff] is to the community,” he said.
Monday was the first time Nota addressed the possible financial repercussions to Gov. Gina Raimondo’s shutdown of the state to fight the coronavirus.
The crisis hit just as the school district, town and state were starting to work on fiscal year 2021 budgets (the new fiscal year starts July 1). A level of uncertainty is already baked into the town’s budget process since its deadline to approve a budget comes weeks before the state usually acts, leaving question marks around EG’s exact amount of state education aid and other numbers. The coronavirus ratchets up the uncertainty.
Nota said some communities in Rhode Island were approving level-funded budgets now and waiting until the budget and COVID-19 dust settled before possibly passing a supplemental tax increase. He doesn’t want to do that. Last month, Nota pushed budget deadlines back by two weeks. Now the approved school budget needs to be given to the town by May 1 and Nota must present his budget by May 15. The Town Council must approve the FY2021 budget by June 24.
“If we get to mid-June and the state is looking like it needs a couple more weeks, we might push our budget deadline back another couple of weeks,” he said.
One big variable in all this is the $1.2 billion in federal COVID-19 stimulus money coming to the state. Most likely, the money will be funneled through the governor’s office and it’s completely unknown how much of that money could be used to help cities and towns.
Council President Mark Schwager said Tuesday he thought Nota was doing the right thing, laying out a bunch of options for the council to review in upcoming budget discussions.
“He wants to make sure we have a very broad conversation,” said Schwager. On the revenue side, he’s talking about refinancing bonds, joining an energy consortium, maybe even buying the town’s street lights, instead of renting them from National Grid.
“On the expense side, he’s just going through all the different boxes you can check,” said Schwager, such as using some reserve funds, not filling vacant positions, not filling proposed positions, and layoffs.
“This is the menu that we have available. We’re going to have to mix and match,” said Schwager. “We’ll have a lot better idea of what’s going on with aid and the General Assembly two months from now. Until then we’ll have to have a very broad view of our budget options.”
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