Proposed 2021 Malden Budget 'So Close, Yet So Far'

MALDEN, MA – The coronavirus pandemic has derailed initially optimistic budget talks in Malden, Mayor Gary Christenson said. In submitting the proposed Fiscal Year 2021 budget to the City Council Tuesday, Christenson described it as "so close, yet so far."

"I can still remember reviewing the draft budget on February 16 where our goal of having our expenses fully supported by our revenues was reached," Christenson wrote in a letter to the Council. "In other words, this was going to be the first year that we didn't have to utilize reserves to balance our annual operating budget."

That's gone "downhill" since the coronavirus pandemic hit, Christenson said. Meals, excise and parking revenue are all down, some by double digits, and the city is expecting a 15-20 percent reduction in local aid from the state.

The proposed budget does not impose any new fees or taxes above what's currently allowed by state law, according to Christenson. The plan will also not require a reduction in necessary city services.

Officials expect the state will not have revised local aid/Chapter 70 figures until around September or October, and there will be "substantial" cuts to local aid. It is anticipated federal aid, the extent of which is unknown, will initially focus on protecting education.

The proposed budget plans for a 15 percent reduction in local unrestricted aid and a $2.1 million reduction in Chapter 70 aid from the governor's initial proposal in January. It funds a budget contingency account with $4.17 million for reductions to the governor's proposal and budgets for a $1.2 million reduction in local receipts from excise taxes, meals taxes and the like.

The proposal also defunds 6.5 full-time equivalents, focusing on newer unfilled adds, departments with scale or longtime unfilled roles, and "asks many employees to give a little so a few don't have to give a lot.

According to a rough budget outline, the city has the most control over staffing levels, non-union wages, services offered, new capital purchases and discretionary projects. It has some control over the Department of Public Works, library and other non-public safety wages and net school spending requirements.

But when it comes to debt expenses, pension costs, health insurance costs and public safety wages, Malden has limited to no control.

The proposed budget did strike a few positive notes: Malden is expected to receive a nearly $1 million casino impact payment shortly after the 2021 fiscal year begins and will prioritize moving offices at 17 Pleasant St. into the new City Hall and relocating the Teen Center to city-owned property, eliminating lease expenses. The constraint on new borrowing means debt service is about $1.6 million less annually than just a few years ago, according to the proposal.

But the economic impact of the pandemic has forced city leaders to tighten their belts. The proposal suggests using a $120,000 Council on Aging grant for core Senior Center expenses to help maintain staffing levels and limit exposure on less predictable expenses; cutting funding of cemetery maintenance labor costs in half from the General Fund and have perpetual care cover the remaining expenses; and eliminating wage increases for departments that operated at a reduced capacity during the pandemic – City Hall, library, public works, parking enforcement and crossing guards.

The proposal is intended to be a "starting point" for responding to the fallout of the pandemic and will likely be amended once the state revises its figures.

"In conclusion, this budget is not what any of us hoped for but it’s also not one that most would expect based on the massive cuts from the state and revenue reductions we are currently facing," Christenson wrote.

Click here for more details about the proposed Fiscal Year 2021 budget.