Manchester-by-the-Sea Finance Committee ANNUAL REPORT

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1 Manchester-by-the-Sea Finance Committee ANNUAL REPORT 2016 Please be sure to attend Town Meeting at Memorial School April 4, 2016 at 7:00 P.M. and bring this report with you.

2 Definitions used in discussing money articles Apportionment AformulausedtocomputetheamounteachtownowestotheRegionalSchoolDistrict. Article 4 Theoperatingbudgetsforthetown. Article 5 Most,butnotall,capitalitems. Assessors overlay AfundinreservefortheBoardofAssessorstocoverabatements. Assessment TheTownBoardofAssessor'sopinionofthevalueofyourproperty. Available funds FundbalancesplusamountsinotheraccountsthatarenotEnterprisefunds. Borrowing Loansthetowntakestopayforlargecapitalitems. Capital budget One-timeexpenses.TraditionallyManchesterhasincludedsomemaintenance, includingroadrepair,newroofs,etc.ascapitalexpenditures. Chapter 70 TheChapteroftheStatelawthatgovernsthefundingofschools.Itisalsothe commonnameforthelargestpartofstatefundingtoschools. Cherry sheets Stateaidtothetown.Socalledbecausetheywereonceprintedonredpaper. Choice Moneythatflowsintotheschooldistrictfromthestatewhenthesystemaccepts studentsfromoutsidethedistrict. Enterprise fund Anaccountseparatefromthetown'sgeneralfundfortherevenueandexpensesofa particularfunctionofthetown. Exclusion AnitemthattheTownMeetingandvotersagreetofundoutsidethelimitsof Proposition21/2. Fund balances Formerlyknownasfreecash,theamountofmoneyleftoverinthegeneralfundat theendoftheyear.mostofthefundbalancescomefromunanticipatedrevenues. General fund TheTown scheckingaccount.thegeneralfundcanbeexpendedonlyfortheitems approvedbytownmeeting. Hold Therequesttodelayconsiderationofonepartofamulti-partarticle.Anyitemthata TownMeetingmemberquestionsismarkedasaholdandwillbediscussedafterthe unquestioneditemshavebeenvoted. Definitions are continued on the outside back cover 2

3 TAX RATE ESTIMATE FOR FISCAL YEAR ENDING JUNE 30, 2017 JULY 1, JUNE 30, 2017 As Recommended By FinCom Fiscal year 2017 Article 4 Department Requests 13,761,538 (salaries and normal operating expenses) Article 5 Capital items requested by Departments 2,023,100 Article 6 Regional School Operating and Debt 14,845,367 Other Articles (4) 1,469,902 Town Meeting Total 32,099,907 PLUS: State Assessments 163,530 Assessors' Overlay 200,000 Snow Deficit 100,000 Tax Lien Purposes 10,000 Gross Amount to be Raised 32,573,437 LESS: State Aid 223,949 Estimated Receipts - Local Revenues 1,864,500 Enterprise Accounts - Water & Sewer 2,317,233 Community Preservation Funds (CPA) 727,500 Unreserved Fund Balance (Free Cash) 826,845 Overlay Surplus 125,000 Available Funds 686,887 Subtotal of Deductions 6,771,914 Net Amount to be Raised by Taxation 25,801,523 Permitted Levy Limited 22,511,530 Estimated new growth factor 225,000 Previous Debt Exclusion 3,064,993 Maximum Permitted Levy 25,801,523 TOTAL ASSESSED VALUATION AS OF FY ,245,655,594 FISCAL YEAR 2016 TAX RATE (PER THOUSAND) ESTIMATED FISCAL YEAR 2017 TAX RATE * (PER THOUSAND) *BASED ON FY-2016 PROPERTY VALUATIONS 3

4 ANNUAL REPORT OF THE FINANCE COMMITTEE TO THE VOTERS OF THE TOWN Beginning in early January, the Finance Committee began reviewing the Town s budgets and capital items for fiscal year 2017 along with other warrant articles to be presented to the voters at the Annual Town Meeting on April 4, We would like to thank Manchester town employees, the Manchester Essex Regional School District, elected officials, and volunteers who prepare detailed budgets and appeared before us to answer questions and provide information about these budgets, their plans, and objectives. In particular, we appreciate the hard work and cooperation of all the department heads who continue to show good discipline in managing their ongoing budgets and operations. We would also like to thank Town Administrator, Greg Federspiel, for his coordination and efforts in assembling all of these budget items and particularly for his thorough grasp of the needs of the Town and putting in place a solid plan for addressing those needs. The Finance Committee met regularly with the Town Administrator, the Town Accountant, and individually with the heads of the major departments to review the Town s operating and capital budgets. We also met with leaders of the School District, attended School Committee meetings, and participated in the school budget working group with other representatives from both Essex and Manchester. Throughout the budget review process, the Finance Committee also met with various consultants to gather additional information and refine particular recommendations. In addition to the fiscal year 2017 budgets and plans, we reviewed multiyear models for both the Town s operating and capital budgets as well as the multiyear budget model prepared by the School District. These multiyear models project the impact that this year s budget, and its changes, will have on future year s budgets, debt levels, capital needs, and reserve balances. As a result of careful and prudent management by the personnel of the Town and School District personnel, coupled with strong local receipts including items such as excise tax payments, beach fees, etc. the Town is in good financial shape. Moving forward, we are comfortable recommending a fiscal year 2017 budget that we believe offers the high level of public services and quality programs that the citizens of Manchester expect and deserve while keeping the Town s operating and capital spending within the levy limit permitted by Proposition 2 ½. The Town s proposed operating budget provides a high level of services at a reasonable cost. However, we are continually looking at ways to deliver these services even more efficiently. Over the last year, the Town began a series of benchmarking projects to compare our services, costs, and resources, to those of other similar towns. Selecting the appropriate towns for comparison, gathering the relevant data, and analyzing this information has been an ongoing project. To date, detailed work has begun on public safety with a close look at the Police and Fire departments that make up a substantial portion of the Town s budget. Work will soon begin for the Department of Public Works and other operational areas within the Town. Members of the Finance Committee, the Board of Selectmen, and various town employees have been instrumental in moving this effort forward. We hope to have more concrete information to share with you in the coming year. This benchmarking effort also ties in with the ongoing, long range master planning effort underway in the Town. Many facets of our infrastructure were put in place decades ago and require continual maintenance, and ongoing replacement. Over this last year, the Town has experienced some unexpected and costly efforts to repair and replace sections of pipe for water and sewer delivery. For three years, a multiyear plan has been underway to update, repair, and replace our aging infrastructure. We hope to continue this effort. The current version of this plan appears later in this booklet. The overall strategy behind this capital plan is to use reserves that the Town has built up in recent years and to replace existing debt as it is retired over the coming years. Through this strategy, the Town should be able to update its physical assets with minimal effect on the tax rate. 4

5 As with the Town of Manchester, the School District is facing concerns about its infrastructure and a long-range planning effort has begun regarding the renovation or potential replacement of the Memorial Elementary School. This process may unfold over the next 4 to 6 years, and has direct impact on the town budgets of Manchester and Essex. Recently, the Massachusetts School Building Association selected the Memorial Elementary School for a comprehensive feasibility study to analyze options going forward. The cost of the feasibility study will be realized in the later part of FY17 and if the building project is approved in the years ahead it will increase town debt. This project has short-term cost implications for Manchester s proposed Fiscal 2017 operating budget and future influences on town debt. Financial Highlights: In Fiscal 2015, which concluded on June 30, 2015, the Town had an undesignated Fund Balance (free cash) of $2,683,364. This fund balance increased as a result of higher than anticipated local receipts like various fees, excise taxes, rental income, etc., working within and below town expense budgets, lower health insurance premiums, and lower utility and energy costs. The Town had an additional $1.26 million in its Stabilization account. Fiscal 2016, ending on June 30, 2016, should close with an undesignated Fund Balance (free cash) of approximately $2.5 million and a Stabilization Account of $1.37 million. The stability in our fund balance, despite a higher use of the funds in FY2017, is made possible by careful financial management coupled with receipts that are higher than the conservative estimates used in the budget process, and a year without major snow removal expenditures. The proposed expenditure of $302,042 for the Regional School District feasibility study of the Memorial Elementary School will be funded from this Fund Balance. Furthermore, the Town maintains a AAA bond rating amongst its creditors, the highest rating that is reserved for financially well managed municipalities and towns. Fiscal 2017 operating expenses compared to Fiscal 2016: Town: 1.9% School: 3.66% {Excluding funds for proposed Feasibility Study} Total appropriations for the fiscal 2017 budget are up 1.8%. However, projects paid with Community Preservation Act funds will decrease significantly in fiscal year 2017, due to the reduction in the CPA surcharge from 3% to 1.5%. Factoring out this change, the overall budget is up 3.34%. A tax increase of 2.5% plus revenues from new growth, local receipts, and enterprise funds will fund our increased operating and capital expenses. Debt service is projected to increase by 12.6% in FY17 since a delay in issuing bonds for 2015 projects resulted in an abnormally lower debt service in FY16 and in anticipation of issuing additional bonds to fund capital projects, at the April 2016 Town Meeting. Salaries make up over 41% of the Town s operating budget. Salaries increased 2.5% based on contractual agreements with employees paying a higher share of health insurance costs. However, with a shift from salaried to contracted personnel, the total remains neutral with a slight decrease in total staffing hours offsetting contractual raises. Non-salaried expenses make up approximately 26% of the Town s operating budget. Expenses have increased 6.1% reflecting some increased costs and the move of personnel costs from salaries to professional services for contracted personnel. Pension expense is up 7.1%, mandated by the state to move toward fully pre-funding pensions. Health insurance expenses are on par from FY16 to FY17. The lack of an increase in the health insurance expenses are a result of employees paying a higher share of the 5

6 costs, the changes made in plan design as part of the last round of union contracts as well as a more accurate enrollment count. Capital expenditures for FY17 are anticipated to be $2,023,100, an increase of 27%, to be funded through a combination of taxation, a small amount from the Town s Fund Balance, water and sewer rates, waterway funds, and other sources. The increase in this expenditure is driven mainly by the increase in waterway fund use for dredging and reflects the ongo wn s infrastructure as described in other areas of this report. In addition, $3.0 million in new bonds are proposed for harbor dredging, and improvements to the water and wastewater systems. Manchester s share of the Manchester Essex Regional School District (MERSD) operating budget is up 3.66% for FY17. This increase represents a balance between maintaining current levels of service and a strong effort to limit increased operating costs. Manchester s enrollment growth is outpacing Essex s resulting in Manchester picking up a higher share of the total costs. The District s total budget is increasing 3.32% while our appropriation is increasing 3.66% (Essex has a 2.70% increase). The budget should leave the Town at the end of FY 17 with financial reserves (Fund Balance plus Stabilization Fund) slightly greater than the estimated FY16 level of approximately $3.9 million. We also encourage you to review the information and graphs presented later in this booklet, which depict various aspects of the Town s Operating Budget and financial position. Overview of the FY17 Town Operating Budget The FY 17 budget implements these basic principles in order to preserve the financial strength the Town has worked hard to achieve; 1. Ensure current revenues are sufficient to support current expenditures. 2. Never fund operating expenditures from debt. 3. Maintain strong General Fund reserves. 4. Provide adequate contingency funds in the budget. 5. Budget sufficient maintenance and replacement dollars to ensure capital facilities and equipment are properly maintained. 6. Strive to maintain the quality of services currently provided, while addressing new or increased service demands through enhanced efficiencies. Each of the Town s departments has once again worked hard to develop an efficient budget. All departments have shown admirable restraint in their requests. Most departmental discretionary expense budgets were held flat or slightly reduced for FY17. Within several departments, operating expenses have increased due to an increase in professional services as the Town works to fill leadership vacancies. Once again in FY17, all unionized employees receive pay increases of 2.5% in accordance with the current union contracts. This increase was negotiated to reflect a trade-off for lower health insurance costs for the town in future years. Most non-union employees will also receive a 2.5% salary increase in FY17. There are no additional employees planned for FY17 but the budget does reflect a shift in personnel to better support the needs of the various planning boards and committees and to accommodate the Town s longrange planning effort. The Town has a few employee vacancies that will not be filled until the departments needs and requirements can be more fully analyzed. Over this last year, the Town experienced significant costs for unexpected repairs on the Town s pipes and infrastructure. These events place a heavy burden on the Town s available cash and impact operating expenses. At the time of this report, unanticipated infrastructure repairs 6

7 cost approximately $300,000. Last winter s record snowfall resulted in a snow and ice expenditures of $692,087 which was reduced to a total deficit of $166,087 by use of FY15 snow and ice appropriation of $176,000, $100,000 from reserve fund, and $250,000 free cash appropriation from April 2015 town meeting. The Federal Emergency Management Agency (FEMA) provided some reimbursement but the net balance of $250,000 had a noticeable impact on the Town s Fund Balance. The Town s website ( provides detailed information on this budget. Other Post-Employment Benefits (OPEB) and Pension Liabilities During the past years, the Town has reduced the unfunded liabilities for healthcare obligations to current and future retirees, commonly called OPEB (Other Post-Employment Benefits). This reduction has involved direct steps to reduce the future liabilities to the Town and setting aside assets to fund those liabilities. On the liability side, structural changes have been made to the Town s health insurance plans, to significantly reduce its unfunded OPEB obligations. Some of these changes include: Requiring all eligible retirees to enroll in Medicare, reducing the cost to the Town for their health care costs, Auditing the benefit rolls on a continuous basis by removing persons no longer entitled to benefits from the Town, identifying eligible retirees who had not yet enrolled in Medicare, and ensuring total deductions by the town and employees match the corresponding enrolled plans. Enacting new rules that prevent retirees who voluntarily leave the Town s health insurance from rejoining it, Changing the insurance program for current employees to increase deductibles and employee contributions, Requiring employees and retirees to pay a higher share of the premiums for a given plan. On the asset side, the Town created an OPEB Trust that it funds on an annual basis at a level that actuaries consider fully pre-funded. This means that, as long as the Town continues to make annual contributions at the appropriate level, within 30 years the assets in the trust will meet the Town s OPEB liabilities at that time. The current review of the Town s OPEB liabilities suggests that we may be running ahead of schedule in our effort to fund our OPEB liabilities fully. The Town s OPEB Trust Fund has been invested in the state s Pension Reserves Investment Trust (PRIT), a large and professionally managed fund, in order to maximize returns. For FY17, the Town will be contributing $238,703 into the OPEB Trust which reflects a conservative rate of return assumption of approximately 5%. The Town also has significant pension liabilities. A state statute specifies the parameter that all municipalities must follow to fund these liabilities. Manchester is following the state mandated program, and its pension liabilities should be fully funded by To learn more about the Town s pension and OPEB liabilities, please see the Board of Selectmen s report contained in this booklet and the Town s OPEB actuarial report and the annual Town Audit which are available online, or at the Town Hall. Capital Plan and Sources of Funding Manchester is in year three of a new ten year capital improvement plan to remedy past deficiencies and meet the Town s infrastructure needs into the future. This plan calls for significant spending on roads, the water treatment and distribution systems, the sewer collection system, and a number of the Town s vehicles and buildings. The capital plan seeks to reduce future operating costs by making energy-saving improvements to a number of the Town s facilities and 7

8 positioning the Town to take advantage of the Green Community s grants and other similar grants. Article 5 details the recommended capital expenditures, requested from taxation and other sources, for a total of $2,023,100 in FY17. These expenditures include a continuation of the road improvement program, water and sewer system replacements and improvements, replacement of some DPW and town vehicles, planning for renovations to Town Hall, safety upgrades at the library, and a partial dredging project in the Town s harbor. In FY 17, additional planned capital improvements cost $886,500. These will be funded as follows; $691,500 from Community Preservation Act funds for town projects, $10,000 from grants and Manchester expects to receive $185,000 in Chapter 90 funds from the state which will be used for road repairs and improvements. The next five-year portion of this ten year capital plan appears later in this booklet. Fund Balances, Other Reserves and Debt When expenses are less than anticipated and/or revenues are higher than budgeted, the excess funds flow into the Town s Fund Balance (formally called Free Cash and much like net income in a commercial context). The Fund Balance is essentially the Town s savings account. On occasion, Town Meeting votes to move some of the Fund Balances to the Town Stabilization Fund maintained for emergencies and other projects. Accessing funds in the Stabilization Account requires a two-thirds majority approval at Town Meeting while use of the regular Fund Balance dollars is by a simple majority vote. The finance committee believes that it is prudent to maintain total reserves (Fund Balance plus Stabilization) in the range of 8% to 12% of the overall town budget including the School District s costs. We estimate that reserves in FY17 will equal approximately $3.9 million or 13.1%. A graph, showing historical levels of reserves, appears later in this booklet. The ongoing, 10 year capital spending plan anticipates keeping the reserves within this range. A portion of the Town s outstanding debt will mature over the next several years as shown in the graphs at the end of this booklet. This will allow us to issue new debt in the coming years to address our 10-year ongoing capital improvement plan without increasing the tax rate. Manchester-Essex Regional School District Budget The School Committee and the District Administration have responsibility for the school budget. The Finance Committee reviews this budget carefully before recommending it to Town Meeting. As previously mentioned, the Finance Committee has a representative on the small working group (consisting of representatives of the School District as well as the towns of Essex and Manchester) which plays an active role in developing the annual budget beginning in the late Fall. The entire Finance Committee has also met with School District officials several times during the budget process culminating in a detailed discussion of the final budget and review of the District s five-year financial plan. The Manchester Essex School District is seeking an increase of 3.66% or $470,496 in the FY17 operating assessment to the Town of Manchester. The town budget presented includes this increase. The portion of the operating budget for the School District that is assessed to the Town of Manchester for FY17 totals $13,320,239. This proposed budget allows the School District to fund its current level of operations for FY17 without using more of its reserves which had been its practice in years past. The budget maintains the same level of personnel and services within the District and provides for some new technology and teaching tools in other key areas. Last year, the Town of Manchester approved an override to fund the School District so that it could operate within the levy limit for a number of years to come. The Manchester Essex Regional School District is currently entering into a multiyear 8

9 process to upgrade or replace the Manchester Memorial Elementary School and eventually the Essex Elementary School. This planning process began with an application to the Massachusetts School Building Association for review, state funding, and guidance as the towns and the School District move into this process. The School District s application to conduct a feasibility study to consider options and designs for the Memorial Elementary School was approved and is anticipated to cost $650,000 over the next two years. The School District has requested $302,042 in FY17 to fund the Manchester portion of this feasibility study. The School District has done a commendable job in addressing its OPEB liabilities. Last year the District negotiated significant changes in its health insurance program that will reduce the long-term OPEB liabilities. The District has pledged to apply significant annual savings from this new health insurance program, approved by the teachers union, for funding the OPEB liability. This contribution coupled with a small amount of OPEB funding in the District s operating budget puts the schools on track to reach actuarial fully pre-funding (which means full funding over 30 years) within a few years. Looking Ahead to FY18 The Town s fiscal year 2018 begins on July 1, Projecting the Town s future finances is difficult, but, we are optimistic that for several years to come we can continue to provide a high level of services for the residents of Manchester and repair the Town s infrastructure within the limits of Proposition 2 ½ and without increasing the debt service load. This plan depends on a number of factors such as the cost of health insurance, energy and state and federal regulation - not to mention natural disasters and unexpected infrastructure failures - all of which are beyond the Town s control. We are confident that the proposed budgets for the Town are in good shape. Moving forward, the Finance Committee, and others, will continue working on the benchmarking effort to evaluate the level of services delivered to the Town s residents and the costs, staffing, and resources needed for delivering these services. Similar communities have been selected for comparisons. Information gathering and analysis are underway and tied in with the Town s overall master planning effort. In the future, both the towns of Manchester and Essex will have the opportunity to consider the upgrading or replacement of the Memorial Elementary School. This opportunity will bring options for financing, considerations for managing a successful design and building project, and absorbing debt. If we can keep increases in annual operating expenses closer to the 3% range, funding the new debt needed for the new school facilities will pose less of an impact on taxpayers. As always, we want to be sure that the residents of Manchester understand the financial condition of the Town. We will be prepared to review these details and discuss this further at Town Meeting and welcome your questions and input. Finance Committee Members Mory Creighton, Chair 2018 Sarah Mellish, Vice Chair 2016 John Croft 2018 Morgan Evans 2017 Ann W. Harrison 2018 Diane Kaneb 2016 Andy Oldeman 2017 Scott Susko 2017 Sue Thorne

10 CAPITAL IMPROVEMENT PROGRAM Introduction The proposed five year capital plan aims to make a significant investment in the infrastructure needs of the community. Like so many other municipalities, Manchester has a large backlog of deferred capital needs. The challenge here is to begin to catch up on this backlog without imposing large new tax burdens on property owners. Our approach relies on allocating a healthy amount of annual tax revenue to capital needs, slowly increasing the amount of funds the water and sewer enterprise funds devote to infrastructure upgrades and replacing old debt with new debt as previously issued debt is retired. This approach avoids new large spikes in taxes while still providing a significant amount of funds towards capital needs. This is possible in large part due to the amount of debt that will be retired in the next ten years. The focus of the capital expenditures is on water and sewer pipes, rehabilitating roads, and developing a game plan for our municipal buildings which have been neglected for decades. A new harbor dredging plan anticipates new bonds every ten years to fund a quarter of the harbor dredging needs on a regular 40 year cycle, paid for through mooring and other harbor use fees. We may need to rely on general funds for some dredging in order to establish this cycle. Factoring in what the School District needs regarding new or rehabilitated elementary schools on top of the many non-school needs will be a significant challenge. The new borrowing that will be required will likely cause our annual debt service to rise above current levels demanding more tax revenue. While the emphasis is on the next five years, looking a bit further into the future we see that we may be facing additional capital needs including renovated and/or expanded facilities for our library, public safety operations and the DPW, and the need to fortify beach revetments and seawalls, especially in the face of climate change and sea level rise. In order to address these and other future needs, it will be very beneficial to keep future operating cost increases on the Town side to about 2% annually and on the School side to about 3.25% annually. Doing so may make it possible to address these larger capital projects without the need for debt exclusion votes that increases our total debt amount and annual tax increases above 2 ½ %. Use of Community Preservation funds, perhaps back at the 3% surcharge level and the accompanying increase in state matching funds, may be necessary for seawall needs. Capital projects For FY17: The enclosed spreadsheet summarizes the list of projects, services and purchases by department for next year and beyond. To fund the FY17 capital plan, a slight increase in general fund revenue use is proposed, increasing the amount to $1.127 million. A small amount of the Town s fund balance is added to this along with state Chapter 90 funds for road work, funds from the water and sewer enterprise accounts, a large amount from the waterways fund for dredging (to be combined with a $1 million bond to be repaid using waterway funds) and new general obligation bonds. Over the next 2 years we anticipate issuing some $7 million in new bonds; $1 million is for the dredging work. Total debt service rises slightly having dipped a bit in the last two years. The goal is to keep debt payments within recent levels. 10

11 Bonds will be used to upgrade the water and sewer systems, make long overdue upgrades to Town Hall, and initiate new harbor dredging work. Community Preservation funds are targeted toward Park and Recreation improvements, finishing up the reconstruction of the boat ramp, renovating Morss Pier and repainting Town Hall. A new fleet replacement schedule has been developed for the DPW. This provides for a systematic and well-spaced plan for ensuring that we have the proper trucks and other important rolling stock for the critical work of the department. This schedule and the Police and Fire Department fleet schedules are included as part of the capital improvement plan. Other highlights for FY17 include funds for design work for the rehabilitation of Town Hall, funding for upgrading the public safety dispatch software to include computer aided dispatching (GIS based), repairs to the Police Station, and replacing warn out turn out gear for our career and call firefighters. A complete listing is shown in Article 5. The Five Year Plan has us spending $24 million on capital improvements with nearly $14 million in new bonds. This does not include possible new bonds for the elementary school. Some $6 million in general funds/fund balance is anticipated. Another million in state highway aid (Chapter 90) and slightly lower amounts each from the water and sewer funds are expected. 11

12 MANCHESTER S 5-YEAR CAPiTAL improvement PROGRAM TOTAL $ 100,000 $ 2,450,000 $ 120,000 $ 35,000 $ - $ 2,705,000 TOTAL $ 262,100 $ 157,500 $ 207,500 $ 335,000 $ 139,000 $ 1,101,100 12

13 Council on Aging Senior Services/COA replacement van grant match $ - $ - $ - $ 150,000 $ - $ 150,000 TOTAL $ - $ - $ - $ 150,000 $ - $ 150,000 Harbor Dredging $ 1,500,000 $ 40,000 $ - $ 50,000 $ 1,050,000 $ 2,640,000 Docks/Ramps $ 40,000 $ - $ - $ - $ - $ 40,000 Equipment/vehicle $ - $ - $ 15,000 $ - $ - $ 15,000 Tuck's point permitting $ 20,000 $ 25,000 $ - $ - $ - $ 45,000 TOTAL $ 1,560,000 $ 65,000 $ 15,000 $ 50,000 $ 1,050,000 $ 2,740,000 Water Department Pipes $ 1,500,000 $ 2,000,000 $ - $ 1,050,000 $ - $ 4,550,000 Treatment Plant/Equipment Upgrades $ 150,000 $ 160,000 $ 200,000 $ 210,000 $ 220,000 $ 940,000 TOTAL $ 1,650,000 $ 2,160,000 $ 200,000 $ 1,260,000 $ 220,000 $ 5,490,000 Sewer Department I/I & Pipes $ 500,000 $ 3,400,000 $ 185,000 $ 205,000 $ - $ 4,290,000 Treatment Plant/Equipment Upgrades $ 200,000 $ 155,000 $ - $ 500,000 $ 230,000 $ 1,085,000 TOTAL $ 700,000 $ 3,555,000 $ 185,000 $ 705,000 $ 230,000 $ 5,375,000 GRAND TOTAL $ 5,218,100 $ 9,387,500 $ 2,287,500 $ 3,478,000 $ 3,634,000 $ 24,005,100 REVENUES FY17 FY18 FY19 FY20 FY21 5 Year Total General Fund (taxes) $ 1,125,000 $ 1,135,000 $ 1,140,000 $ 1,145,000 $ 1,150,000 $ 5,695,000 Fund Balance $ 70,100 $ 57,500 $ 52,500 $ 13,000 $ 49,000 $ 242,100 Chapter 90 $ 185,000 $ 185,000 $ 185,000 $ 185,000 $ 185,000 $ 925,000 Water Funds $ 150,000 $ 160,000 $ 170,000 $ 180,000 $ 190,000 $ 850,000 Sewer Funds $ 100,000 $ 125,000 $ 155,000 $ 175,000 $ 200,000 $ 755,000 Harbor Funds $ 560,000 $ 65,000 $ 15,000 $ 50,000 $ - $ 690,000 Other $ 28,000 $ 10,000 $ 70,000 $ 180,000 $ 810,000 $ 1,098,000 Bonds $ 3,000,000 $ 7,650,000 $ 500,000 $ 1,550,000 $ 1,050,000 $ 13,750,000 Grand Total $ 5,218,100 $ 9,387,500 $ 2,287,500 $ 3,478,000 $ 3,634,000 $ 24,005,100 13

14 BOARD OF SELECTMEN REPORT ON FUTURE OBLiGATiONS FOR RETiREMENT AND HEALTH CARE BENEFiTS AN UPDATE OF OUR FUTURE LiABiLiTiES Pursuant to the provisions of Article IX, Section 3 as amended of the Town s General Bylaws, the Board of Selectmen submit the following report concerning the Town s future obligations for pensions and retiree health insurance. Introduction Pensions and retiree health insurance are benefits that are offered to all Town employees who work more than 20 hours a week per the requirements of Massachusetts General Laws. Like the vast majority of municipalities, Manchester has historically paid for these benefits in a pay as you go fashion that is, we pay only the bill that is due that year, not the bill we are incurring for future years in the form of promised retiree benefits. While this approach was fine when benefits where less expensive and the number of retirees were relatively modest, the cost trends, life expectancy trends and the desire for truer cost accounting have placed a new emphasis on putting money aside now in order to pay for future pay-outs. Such an approach has the added advantage of the power of compounding interest earnings, putting the money we set aside to work to ease the financial burden of the future benefits. Town Pensions The Town of Manchester is a member of the Essex Regional Retirement System. All employees contribute their own funds to the system but, in the past, not enough funds have been collected to fully fund the future payments promised by the retirement board. While this has been corrected for new employees, all municipalities are contributing funds to make up for the under collection in the past. It is anticipated that the retirement system will be fully funded by 2035 at which time the Town will no longer have an unfunded pension liability. The Essex Regional Retirement Board s unfunded liability was estimated by an actuarial study to be $348,746,229 as of January 1, 2014 based on current assets of approximately $328 million and total liabilities of $676 million. This is the present day value of obligations expected to be incurred over the next 30 years. Manchester employees comprise 3.45% of the total pool thus our share of the system s liability is $12,031,745 again over a projected 30 years. Annually we contribute a portion of this liability. For FY17 we will contribute $1,010,645 for both current and future liabilities. This number is expected to grow 7% annually through FY2019 and 4% annually from FY Essex Regional Retirement System Total Assets = $328 million Present day Value of Liabilities = $676 million Unfunded Liabilities = $349 million Manchester Share 3.45% = $ 12 million Annual Town Payment = $1,010,645 increasing 4-7% annually On schedule to be fully funded by 2035 Town OPEB (other post employment benefits retiree health insurance) The Town provides health insurance to all retirees eligible for a pension. Voters approved this benefit decades ago and, by state law, we must now continue to do so. Because the Town has been in operations for hundreds of years, our pool of retirees, while growing 14

15 slightly, is relatively stable. Thus, our pay as you go amount started out already at 70% of the required Annual Required Contribution, or ARC. We are now at 100% + when we combine our annual pay as you go amount with the amount we add to the trust. Our most recent actuarial study (as of 7/1/14), completed by Sherman Actuarial Services, concluded that our total Actuarial Accrued Liability for both active employees and retirees comes to $8.4 million. This is the present day value of the cost of retiree health insurance for the next 30 years. This calculation has come down significantly as the full impact of the lower cost health insurance plan that was introduced is realized, the recent years of substantially lower annual premium increases is factored in, and the advantage of pre-funding begins to work (higher interest earnings on funds means the present day value of the liability is reduced.) In addition to the pay as you go funding, the Town has established and is funding annually an OPEB Trust Account. The contribution schedule we are following is contained in the Sherman Actuarial Study. Our current contribution to the trust assumes a more conservative return on investment of about 5.25% annually compared to the 8% ROR the study used. Assuming voters approve the next payment installment to the OPEB Trust account, we will have approximately $1,054,000 in the trust account which, when combined with our pay as you go amount, should put us ahead of the 30 year plan to be fully pre-funded for our OPEB obligations. The annual appropriation to the OPEB Trust is slated to grow in the 4% range. In addition to funding the Trust, the Town continues to work on controlling the cost of our health insurance obligations. We have successfully implemented plans that have higher copays and deductibles. We require all eligible retirees to enroll in Medicare. We continue to pursue wellness strategies to keep cost increases down. We work with our unions to negotiate fair premium cost sharing. As of 7/1/12 new employees pay 30% of the premium; veteran employees will be paying 25% come July, Legislative changes also may help to lower our liabilities. Beacon Hill may pursue changes in retiree eligibility rules that will reduce our future obligations for new hires. We will monitor these developments and urge our legislative delegation to push through more needed reforms to the laws that govern how we provide benefits to our retirees to ensure that we can afford to provide a fair and cost effective package. OPEB Assets and Liabilities Present Day value of Liabilities over 30 years Current Assets (assumes 4/4/16 appropriation) Annual Town Appropriation On schedule to be fully funded in 30 yrs $ 8.40 million $ 1.05 million $ 0.92 million increasing 4% yearly 15

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20 COMMONWEALTHOFMASSACHUSETTS TOWN OF MANCHESTER-BY-THE-SEA ANNUAL TOWN MEETiNG WARRANT Essex, ss. ToanyoftheConstablesoftheTownofManchester-by-the-Sea: Greetings: InthenameoftheCommonwealthofMassachusettsyouareherebyrequiredtonotify andwarntheinhabitantsofthetownofmanchester-by-the-seaqualifiedtovoteinelections,tomeetinthememorialschool,onlincolnstreet,inmanchester-by-the-sea,on Monday, the fourth day ofapril, two thousand and sixteenad, at seven o'clock in the evening,forthepurpose,towit: ARTiCLE 1. ToseeiftheTownwillvotetoreceiveandplaceonfilethe reportsofthetownboardsandcommitteesappearingintheannualreport,ortakeany otheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 2. ToseeiftheTownwillvotetofixthe12-monthfiscalyear salaryandcompensationofallelectiveofficersofthetownasprovidedinsection108of Chapter41,asamended,asfollows;ortakeanyotheractionrelativethereto. Moderator $0.00 Chairman,Selectmen $0.00 OtherfourSelectmen $0.00 WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 3. ToseeiftheTownwillvotetoraiseandappropriateortransferfromavailablefundsasumofmoneyastheTown'sshareoftheEssexNorthShore AgriculturalandTechnicalSchoolDistrict,ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen 20

21 ARTiCLE 4. ToseewhatsumsofmoneytheTownwillraisebytaxation orotherwisetopaytowndebtsandchargesfortheensuing12months,effectivejuly1, 2016,andappropriatethesame. PerpetitionoftheBoardofSelectmen DEPARTMENTAL REQUESTS AND FiNANCE COMMiTTEE RECOMMENDATiONS Item Appropriations Requests Recommendations No. FY'16 FY'17 FY'17 FundingSources GENERAL GOvERNMENT 31% SELECTMEN'S DEPARTMENT 1 Salaries 186, , ,620 TAXATION 2 Expenses 26,400 24,350 24,350 TAXATION 3 Audit 35,000 36,000 36,000 TAXATION 4 Information Technology 106, , ,750 TAXATION MODERATOR 5 Expenses TAXATION FINANCE COMMITTEE 6 Salaries 2,000 2,000 2,000 TAXATION 7 Expenses TAXATION 8 Reserve Fund 170, , ,000 TAXATION 50,000 OVERLAY SUR. 125,000 ELECTION & REGISTRATION 9 Salaries 3,300 3,800 3,800 TAXATION 10 Expenses 10,300 11,000 11,000 TAXATION ACCOUNTING 11 Salaries 126, , ,533 TAXATION 12 Expenses 4,370 4,850 4,850 TAXATION ASSESSORS 13 Salaries 137, , ,537 TAXATION 14 Expenses 39,820 39,675 39,675 TAXATION TREASURER/COLLECTOR 15 Salaries 155, , ,149 TAXATION 16 Expenses 26,840 26,840 26,840 TAXATION TOWN CLERK 17 Salaries 89,937 97,698 97,698 TAXATION 18 Expenses 6,050 6,050 6,050 TAXATION LEGAL & Other Professional Services 19 Expenses 100, , ,000 TAXATION APPEALS BOARD 20 Salaries 17,800 18,245 18,245 TAXATION 21 Expenses 13,600 13,600 13,600 TAXATION PLANNING BOARD 22 Salaries 34,641 45,507 45,507 TAXATION 23 Expenses 17,820 19,050 19,050 TAXATION TOWN HALL & COMMON 24 Expenses 61,650 70,650 70,650 TAXATION 21

22 PENSIONS 25 Contributory 943,343 1,010,645 1,010,645 TAXATION 894,016 SEWER RATES 71,251 WATER RATES 45, Non-Contributory 2,400 2,200 2,200 TAXATION INSURANCE 27 Group Health Ins. 1,559,928 1,559,928 1,559,928 TAXATION 1,455,738 SEWER RATES 65,209 WATER RATES 38, Workers' Comp. 65,000 65,000 65,000 TAXATION 45,500 SEWER RATES 9,000 WATER RATES 10, Fire/Auto/Liability 125, , ,000 TAXATION 103,450 SEWER RATES 10,000 WATER RATES 11, Unemployment Comp. 20,000 10,000 10,000 TAXATION 31 FICA-Medicare 81,424 85,495 85,495 TAXATION 78,895 SEWER RATES 3,300 WATER RATES 3,300 Total General Government 4,167,810 4,258,542 4,258,542 TAXATION 3,865,073 OVERLAY SUR. 125,000 SEWER RATES 158,760 WATER RATES 109,709 4,258,542 PUBLIC SAFETY 23% POLICE 32 Salaries 1,518,207 1,552,253 1,493,867 TAXATION 33 Expenses 112, , ,250 TAXATION PARKING CLERK/RESIDENT PARKING 34 Salaries 8,727 11,518 11,518 TAXATION 35 Expenses 10,355 11,955 11,955 TAXATION FIRE 36 Salaries 1,125,231 1,150,217 1,150,217 TAXATION 37 Expenses 118, , ,700 TAXATION HARBOR MASTER 38 Salaries 89,651 93,087 93,087 MOORING FEES 75,087 BOAT EXCISE 18, Expenses 18,800 18,800 18,800 MOORING FEES BUILDING DEPARTMENT 40 BUILDING INSPECTOR 43,080 44,406 44,406 TAXATION 41 GAS/PLUMBING INSPECTOR 12,049 12,351 12,351 TAXATION 42 SEALER OF WIGHT'S & MEASURES 3,395 3,395 3,395 TAXATION 43 ELECTRICAL INSPECTOR 12,049 12,351 12,351 TAXATION 44 INSPECTORS' EXPENSES 4,800 4,800 4,800 TAXATION 22

23 EMERGENCY MANAGEMENT 45 Salaries 8,931 6,000 6,000 TAXATION 46 Expenses 1,000 1,000 1,000 TAXATION 47 Emergency Notification 5,500 5,500 5,500 TAXATION ANIMAL CONTROL 48 Salaries 13, TAXATION 49 Expenses 5,500 17,500 17,500 TAXATION Total Public Safety 3,112,185 3,184,083 3,125,697 TAXATION 3,013,810 MOORING FEES 93,887 BOAT EXCISE 18,000 3,125,697 PUBLIC WORKS 12% DEPARTMENT OF PUBLIC WORKS 50 Salaries 703, , ,606 TAXATION 51 Expenses 235, , ,850 TAXATION SNOW REMOVAL 52 Salaries 31,775 32,000 32,000 TAXATION 53 Expenses 170, , ,000 TAXATION 54 STREET LIGHTING 95,000 95,000 95,000 TAXATION SANITATION/COMPOSTING/RECYCLING 55 Salaries 22,550 22,550 22,550 TAXATION 56 Expenses 55,000 59,000 59,000 TAXATION 57 Rubbish Collection/Recycling 295, , ,000 TAXATION 58 Disposal 108, , ,000 TAXATION Total Dept. of Public Works 1,717,028 1,689,006 1,689,006 TAXATION 1,689,006 OTHER ENVIRONMENTAL 1% HISTORIC DISTRICT COMMISSION 59 Salaries 5,487 3,000 3,000 TAXATION 60 Expenses 1,200 1,200 1,200 TAXATION CONSERVATION COMMISSION 61 Salaries 60,471 61,984 61,984 TAXATION 46,984 WETLANDS FD. 15, Expenses 2,650 2,650 2,650 TAXATION 63 CHEBACCO WOODS 1,250 1,250 1,250 TAXATION Total Other Environmental 71,058 70,084 70,084 TAXATION 55,084 WETLANDS FD. 15,000 70,084 23

24 HUMAN SERVICES 2% HEALTH 64 Salaries 60,868 62,355 62,355 TAXATION 65 Expenses 60,650 58,650 58,650 TAXATION VETERANS' SERVICES 66 Veterans' Agent 12, TAXATION 67 Expenses ,050 15,050 TAXATION 68 Veterans' Benefits 2, TAXATION COUNCIL ON AGING 69 Salaries 134, , ,431 TAXATION 70 Expenses 15,900 16,400 16,400 TAXATION Total Human Services 286, , ,386 TAXATION 293,386 LIBRARY 3.27% LIBRARY 71 Salaries 293, , ,955 TAXATION 72 Expenses 147, , ,962 TAXATION Total Culture and Informational 441, , ,917 TAXATION 449,917 RECREATION 3% PARKS & RECREATION 73 Salaries 125, , ,930 TAXATION 74 Expenses 63,550 8,550 8,550 TAXATION SINGING BEACH OPERATIONS 75 Salaries 62,325 63,884 63,884 TAXATION 76 Expenses 14,325 14,325 14,325 TAXATION LIFEGUARDS 77 Salaries 50,160 51,414 51,414 TAXATION 78 Expenses 3,400 3,400 3,400 TAXATION TUCK'S POINT 79 Salaries 4,000 6,000 6,000 TAXATION 80 Expenses 32,370 30,370 30,370 TAXATION BUILDINGS & GROUNDS 81 Salaries - 75,269 75,269 TAXATION 82 Expenses - 45,000 45,000 TAXATION OTHER RECREATION 83 MEMORIAL DAY 3,000 3,000 3,000 TAXATION 84 FOURTH OF JULY 10,000 11,000 11,000 TAXATION Total Recreation 369, , ,142 TAXATION 447,142 24

25 DEBT SERVICE 14% DEBT SERVICE PRINCIPAL ON BONDS 1,507,380 1,623,704 1,623,704 INTEREST ON BONDS 208, , ,087 TEMPORARY LOANS/INTEREST 30,000 30,000 30,000 WPAT ADMINISTRATION FEES 1,783 1,025 1, Total Debt Service 1,748,102 1,968,816 1,968,816 TAXATION 1,629,001 SEWER RATES 339,815 1,968,816 ENTERPRISE FUNDS 11% SEWER FUND 86 Salaries 258, , ,899 SEWER RATES 87 Expenses 275, , ,750 SEWER RATES WATER FUND 88 Salaries 245, , ,306 WATER RATES 89 Distribution Expenses 91, , ,300 WATER RATES 90 Treatment Expenses 532, , ,694 WATER RATES Total Enterprise Funds 1,402,928 1,458,949 1,458,949 SEWER RATES 545,649 WATER RATES 913,300 1,458,949 TOTAL ARTICLE 4 13,192,990 13,316,165 13,316,165 EXPENSES BUDGET SUMMARY GENERAL GOVERNMENT 31% 4,167,810 4,258,542 4,258,542 TAXATION 3,865,073 OVERLAY SUR. 125,000 SEWER RATES 158,760 WATER RATES 109,709 4,258,542 PUBLIC SAFETY 23% 3,112,185 3,184,083 3,125,697 TAXATION 3,013,810 MOORING FEES 75,887 BOAT EXCISE 18,000 3,125,697 DEPARTMENT OF PUBLIC WORKS 12% 1,717,028 1,689,006 1,689,006 TAXATION 1,689,006 OTHER ENVIRONMENTAL 1% 71,058 70,084 70,084 TAXATION 55,084 WETLANDS FD. 15,000 70,084 HUMAN SERVICES 2% 286, , ,386 TAXATION 293,386 LIBRARY 3% 441, , ,917 TAXATION 449,917 25

26 PARKS & RECREATION 3% 369, , ,142 TAXATION 447,142 DEBT SERVICE 14% 1,748,102 1,968,816 1,968,816 TAXATION 1,629,001 SEWER RATES 339,815 1,968,816 ENTERPRISE FUNDS 11% 1,402,928 1,458,949 1,458,949 SEWER RATES 545,649 WATER RATES 913,300 1,458,949 TOTALS 100% 13,316,165 13,819,924 13,761,538 13,761,538 FUNDING SOURCES SUMMARY TAXATION 11,442,419 OVERLAY SURPLUS 125,000 MOORING FEES 93,887 BOAT EXCISE 18,000 WETLANDS FD 15,000 SEWER RATES 1,044,224 WATER RATES 1,023,009 TOTAL 13,761,538 WE RECOMMEND APPROvAL The Board of Selectmen recommends approval with the addition of $58,386 added to the Police Dept. Salary Lines to maintain current staffing levels 1) Planning:addedfundsformasterplaneffort. 2) Police:FinComrecommendsreductionofonepatrolofficer(vacancyleftopen.) 3) ACOandVeteranAgent:nowcontractedservicethusfundsmovedfromsalariesto expenses. 4) DPW: funds moved to new Buildings and Grounds account; funds moved from salariestoexpensesforcontractedinterimdpwdirector 5) ParksandRecreation:fundsmovedtonewBuildingsandGroundsaccount 26

27 ARTiCLE 5. To see if the Town will vote to raise and appropriate the sumsofmoneycalledforunderthefollowingitems,oranyothersums,forthepurposes indicated,andtodeterminewhetherthemoneyshallbeprovidedbytaxation,byappropriationfromavailablefundsinthetreasury,orbyborrowing,ortakeanyotheractionrelativethereto. Funding Dept. item Requested Recommended Source 1 DPW RoadResurfacing $215,000 $215,000 Taxation 2 DPW Stormdrainimprovements $150,000 $150,000 Taxation 3 DPW LargeDump Truck/sander/plow $198,000 $198,000 Taxation 4 DPW PickupTruckwithplow $55,000 $55,000 Taxation 5 DPW TruckwithPlow andsander $75,000 $75,000 Taxation 6 DPW TrenchBox,small bucket,roller $43,000 $43,000 Taxation 7 DPW FacilityUpgrades $500,000 $0 8 TownHall VotingTabulating Machines $13,000 $13,000 Taxation 9 TownHall TownHallRenovation Work $100,000 $100,000 Taxation 10 Library Wiring/OfficeUpgrade $15,000 $15,000 FundBal 11 PublicSafety FireEngineFund $60,000 $60,000 Taxation 12 PublicSafety FireDept.Turn-outgear $56,000 $34,000 Taxation 13 PublicSafety ParamedicMonitor Replacement $34,000 $34,000 Taxation 14 PublicSafety PoliceCruiser Replacement $65,000 $39,500 FundBal 15 PublicSafety PoliceStationRepairs $50,000 $50,000 Taxation 16 PublicSafetyDispatchTechnology up-grade $31,600 $31,600 FundBal 17 Harbor HarborDredging& relatedwork $500,000 $500,000 WaterwayFund 18 Harbor ReedParkDock Expansion $40,000 $40,000 WaterwayFund 19 Harbor Tuck spointfloat Permitting $20,000 $20,000 WaterwayFund 20 Water GeneralPlant/Pumps Upgrades $150,000 $150,000 WaterFund 21 Sewer PlantImprovements $200,000 $200,000 Taxation& SewerFund Total $2,570,600 $2,023,100 PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL AS indicated in THE "RECOMMENDED" COLUMN, AND THAT; items 1, 2, 3, 4, 5, 6, 8, 9, 11, 12, 13 and 15; $1,027,000 BE FUNDED BY TAXATiON; 27

28 items 10, 14, and 16; $86,100 BE FUNDED BY FUND BALANCE; items 17, 18, and 19; $560,000 BE FUNDED BY WATERWAY FUNDS; item 20; $150,000 BE FUNDED BY WATER RATES; item 21; $100,000 BE FUNDED BY TAXATiON AND $100,000 BE FUNDED FROM SEWER RATES. The Board of Selectmen recommends approval ARTiCLE 6. ToseeiftheTownwillvotetoraiseandappropriateortransferfromavailablefundsasumofmoneyfortheTown sassessmentfromthedistrictfor thegrossoperatingandmaintenancebudgetofthemanchester-essexregionalschool Districtincludingdebtservice-saidsumtobecalculatedsolelyinaccordancewiththe "AgreementBetweentheTownsofEssexandManchester-by-the-Sea,Massachusettswith RespecttotheFormationofaRegionalSchoolDistrict",asmostrecentlyamended,by invokingandapprovingtheprovisionfoundinparagraphfourofg.l.c.71, 16BallowingDistrictmembers"toreallocatethesumoftheirrequiredlocalcontributionstotheDistrictinaccordancewiththeregionalagreement",forthefiscalyearbeginningJulyfirst, twothousandsixteen;ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheManchester-EssexRegionalSchoolCommittee ARTiCLE 7. ToseeiftheTownwillappropriate$302,042,whichrepresents its apportioned share of the Manchester Memorial Elementary School feasibility study, authorized by the Manchester Essex Regional School District(MERSD), for the purposeofpayingcostsofthemanchestermemorialelementaryschoolfeasibilitystudy, fortheschoollocatedat43lincolnstreetinmanchester-by-the-sea,massachusetts,and furtherdescribedinadeedrecordedinbook3507pages137and38intheessexsouth RegistryofDeedsanddepictedonMap47,lot6oftheTownofManchesterbytheSea Assessors maps,andforwhichthedistrictmaybeeligibleforaschoolconstructiongrant from the Massachusetts School Building Authority ( MSBA ), said amount to be expendedatthedirectionofmersdschoolbuildingcommittee.themsba sgrantprogram is a non-entitlement, discretionary program based on need, as determined by the MSBA,andanyStudycoststheDistrictincursinexcessofanygrantapprovedbyand receivedfromthemsbashallbethesoleresponsibilityofthedistrictanditsmember municipalities.anygrantthatthedistrictmayreceivefromthemsbaforthestudyshall beassetforthinthefeasibilitystudyagreementthatmaybeexecutedbetweenthedistrictandthemsba. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheManchester-EssexRegionalSchoolCommittee 28

29 ARTiCLE 8. ToseeiftheTownwillvotetohearandactonthereportof thecommunitypreservationcommitteeonthefiscalyear2017communitypreservation budgetandtoappropriatefromthecommunitypreservationfundestimatedannualrevenues a sum of money to meet the administrative expenses and all other necessary and properexpensesofthecommunitypreservationcommitteeforfiscalyear2017;andfurthertoreserveforfutureappropriationasumofmoneyfromthecommunitypreservation Fundestimatedannualrevenuesforopenspace,includinglandforrecreationalspace,historicresources,andcommunityhousingpurposes,aswellasasumofmoneytobeplaced inthe2017budgetedreserveforgeneralcommunitypreservationactpurposes;andfurthertoappropriatefromthecommunitypreservationfundasumorsumsofmoneyfor CommunityPreservationprojectsorpurposesasrecommendedbytheCommunityPreservationCommitteeasfollows;ortakeanyotheractionrelativethereto. 1. CommunityPreservationCommitteeExpenses(studies,etc.) (administrative) $21,000* 2. TownHallBoatRampRemediation (recreation/openspace) $150, MorssPierSeawallRepairs (recreation/openspace) $200, ParkandRecreationParkImprovements (recreation/openspace) $104,000** 5. AffordableHousingTrustTechnicalSupport (communityhousing) $ 30,000*** 6. CemeteryRestorationWork (historicpreservation) $25, TownHallExteriorPaintingandrelatedwork (historicpreservation) $57, CrowellChapelSafetyImprovements(higheroccupancy) (historicpreservation) $90, Tuck spointrotundarestoration (historicpreservation) $5, HistoricBeachCabanaRestoration(HistoricalMuseum) (historicpreservation) $15, LibraryDirector sofficerehabilitation (historicpreservation) $15, CommunityHousingReserve (communityhousing) $15,000 TOTAL $727,500 *Administrativeamountlimitedto5%oftotalannualrevenue **For recreational improvements at Reed Park(walkway and irrigation), Masconomo Park(signage,landscaping,ADAaccessibility,parkinglotstriping,trashbarrels),Sweeney Park(basketballhoops),TucksPointPark(picnictables)andSingingBeach(signage,parkinglotstriping,picnictables,streetlight,andcellphoneservicetoenhancepublicsafety). ***ContingentontheapprovalofArticle18whichproposesthecreationoftheAffordable HousingTrust;otherwisethe$30,000willbeallocatedtotheCommunityHousingReserve. PerpetitionoftheCommunityPreservationCommittee WE RECOMMEND APPROvAL The Board of Selectmen recommends approval ARTiCLE 9. Toseewhatactionthetownwilltake,ifany,toimplement electronicvotingatfuturetownmeetings,includingtoauthorizetheboardofselectmen totakethestepsnecessarytoimplementelectronicvotingatfuturetownmeetings,includingenteringintoanypurchase,leaseorrentalagreementsand/orservicecontractsrelated toelectronicvoting,andtoraiseandappropriate,borrowortransferfromavailablefundsa sumofmoneyforsuchpurpose,ortakeanyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor 29

30 ARTiCLE 10. To see if the Town will vote to require that all individual spendingarticlestoraiseandappropriatefunds,includingtofundthetown sassessment fromthemanchesteressexregionalschooldistrict,inexcessof$500,000besubjectto aballotvoteheldatthesametimeastownelections.suchvotemustequalorexceeda twothirdsmajorityforthespendingtobeapproved.ifthevoteislessthantwothirds, spending for such individual spending articles for the following year will remain at the levelofthepresentyear.spendingforpensionsanddebtservice,butnotnewdebt,isto beexemptfromthisrequirement.iftheboardofselectmen,byunanimousvote,declares anunforeseenemergency,suchasanaturaldisaster,whichrequiresspendinginexcessof $500,000,approvalofsuchspendingwillbeexemptfromthisrequirement. PerPetitionof10ormoreResidents WE WiLL MAKE OUR RECOMMENDATiON ON THE TOWN MEETiNG FLOOR The Board of Selectmen will make its recommendation on the Town meeting floor ARTiCLE 11. ToseeiftheTownwillvotetotransferfromtheWater EnterpriseUndesignatedFundBalanceatotalof$50,000asasupplementalappropriation tothefy16waterdepartmenttodefrayunexpectedexpenses,ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 12. To see if the Town will appropriate the following unexpendedamountofmoneythatwasinitiallyborrowedtofinancecapitalprojectsthatare nearlycomplete,andforwhichnofurtherunaccountableliabilityremains,topaycostsof the repairs to Morss Pier and adjacent seawalls and the renovation of the Town s boat ramp,aspermittedbychapter44,section20ofthegenerallaws;ortakeanyotheraction relativethereto. Unexpended Date of Warrant Original Amount Approval Article Purpose $60,000 May22,2013 Article2 Seawallrepairs WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 13. ToseeiftheTownwillvotetoraiseandappropriate,transferfromavailablefunds,orborrow$2,000,000topaycostsofcapitalimprovementstothe Town swaterandwastewatersystems,includingthepaymentofallcostsincidentaland relatedthereto;andtodeterminewhetherthisamountshallberaisedbytaxation,transfer fromavailablefunds,borrowing,orotherwise,ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen 30

31 ARTiCLE 14. ToseeiftheTownwillvotetoraiseandappropriate,transfer from available funds, or borrow $1,000,000 to pay costs of dredging and other improvements to the Town s harbor, including the payment of all costs incidental and relatedthereto;andtodeterminewhetherthisamountshallberaisedbytaxation,transfer fromavailablefunds,borrowing,orotherwise,ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 15. ToseeiftheTownwillvotetoauthorizetheBoardofSelectmentograntandconvey,in,onandunderportion(s)oftheTown-ownedparcelofland knownasthemosseshillwatertanklotlocatedonpinestreet,shownonassessorsmap 58asLot56,anddescribedinaninstrumentrecordedwiththeEssexSouthRegistryof Deeds in Book 1962, Page 405, such permanent and/or temporary access, utility and related easements as may be necessary or convenient to serve said property and/or the telecommunicationsequipmentthereon,ortakeanyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE TAKE NO POSTiON ON THiS ARTiCLE The Board of Selectmen recommends approval ARTiCLE 16. ToseeiftheTownwillvotetoraiseandappropriateortransferfromavailablefunds$238,703tobedepositedintotheTown sotherpostemployment BenefitsTrust Fund, subject to said appropriation being expended from thetrust Fund onlyforthepurposesauthorizedbysection20ofchapter32bofthegenerallawsofthe CommonwealthofMassachusetts;ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen ARTiCLE 17. To see if thetown will vote to reauthorize the Recreation Programs revolving fund established pursuant to the provisions of Chapter 44, section 53E1/2oftheMassachusettsGeneralLaws,forthefiscalyearbeginningJuly1,2016,said fundtobeexpendedbytherecreationdirectorforcostsassociatedwithtownofmanchester-by-the-searecreationprograms,withregistrationfees,orotherfundsintendedto supporttheprogramsofferedbytherecreationdepartmentdepositedintothefund,and totalannualexpendituresfromthefundnotexceeding1%ofthefy2016taxlevy,or $249,000;ortakeanyotheractionrelativethereto. WE RECOMMEND APPROvAL The Board of Selectmen recommends approval PerpetitionoftheBoardofSelectmen 31

32 ARTiCLE 18. To see if the Town will vote to accept the provisions of MassachusettsGeneralLawsChapter44,Section55C,andtoestablishatrusttobeknown asthemanchester-by-the-seaaffordablehousingtrustfund,whosepurposeshallbeto provideforthecreationandpreservationofaffordablehousinginthetownofmanchester-by-the-seaforthebenefitoflowandmoderateincomehouseholds,andinimplementationthereofwillvotetoamendthetown smanchester-by-the-seageneralby-lawsby addingthefollowingasarticlexxi,ortotakeanyotheractionrelativethereto. Town of Manchester-by-the-Sea General By-laws Article XXi Section1 AffordableHousingTrust ThereshallbeaManchester-by-the-SeaAffordableHousingTrust,thepurposeof whichshallbetoprovideforthepreservationandcreationofaffordablehousing inthetownmanchester-by-the-seaforthebenefitoflowandmoderateincome households.thetrustshallbegovernedbytrusteesinaccordancewithmassachusetts General Laws Chapter 44, Section 55C and the authority granted by TownMeeting,asrevisedfromtimetotime. Section2 NameoftheTrust Thistrustshallbecalledthe Manchester-by-the-SeaAffordableHousingTrust, hereinreferredtoasthetrust. Section3 Purposes ThepurposeofthisTrustshallbetoprovideforthecreationandpreservationof affordablehousinginthetownofmanchester-by-theseaforthebenefitoflow andmoderateincomehouseholdsandinfurtheranceofthispurpose,toacquire bygift,purchase,orotherwiserealestateandpersonalproperty,bothtangibleand intangible,ofeverysortanddescription;tousesuchproperty,bothrealandpersonal,insuchmannerasthetrusteesshalldeemmostappropriatetocarryout suchpurpose,providedhowever,thatallpropertycomprisingthistrustandthe netearningsthereofshallbeusedonlyinthetownexclusivelyforthebenefitof alloftheinhabitantsofthetownofmanchester-by-the-seaforthecreationand preservationofaffordablehousingforwhichthistrustwasformedandnopart oftheactivitiesofthetrustshallconsistofpropagandaorotherwiseattempting toinfluencelegislationorparticipationinorinterventionin(includingthepublicationordistributionofstatements)anypoliticalcampaignonbehalfofanycandidateforpublicofficeandnopartofthenetearningsofthistrustshallinureor bepayabletoorforthebenefitofanyprivateindividualorcorporation. Section4 BoardofTrustees ThereshallbeaBoardofTrustees(the Board )consistingofseven(7)trusteeswho shallbeappointedbytheboardofselectmen(5members)andthetownmoderator(2members).themembersoftheboardshallbecomprisedofasfollows: one(1)memberoftheboardofselectmen,oritsdesignee; one(1)memberofthecommunitypreservationcommitteeoritsdesignee; one(1)memberofthemanchesterhousingauthorityoritsdesignee; one(1)memberoftheplanningboardoritsdesignee; one(1)memberofthefinancecommitteeoritsdesignee;and two(2)citizensatlargeselectedbythetownmoderator 32

33 Section5 TenureofTrustees OnlypersonswhoareresidentsoftheTownshallbeeligibletoholdtheofficeof Trustee.Trusteesshallserveforatermnottoexceedtwoyearsandmaybereappointed at the discretion of the Board of Selectmen or Town Moderator, as applicable.anytrusteewhoceasestobearesidentofthetownshallceasetobe atrusteehereunderprovidedthatawrittennotificationofthechangeinresidence hasbeenfiledwiththetownclerk.anytrusteemayresignbywritteninstrument signedandacknowledgedbysuchtrusteeanddulyfiledwiththetownclerkand recordedwiththeregistryofdeedsandfiledwiththelandregistrationoffice. IfaTrusteeshalldie,resign,orforanyotherreasonceasetobeaTrusteehereunderbeforehis/hertermofofficeexpires,asuccessorshallbeappointedbyajoint meeting of the appointing authority and the remaining Trustees to fill such vacancy,providedthatineachcasethesaidappointmentandacceptanceinwritingbythetrusteesoappointedisfiledwiththetownclerkandrecordedwiththe RegistryofDeedsandfiledwiththeLandRegistrationOffice.UpontheappointmentorelectionofanysucceedingTrusteeandthefilingofsuchappointmentor acertificateofsuchelectionthetitletothetrustestateshallthereuponandwithoutthenecessityofanyconveyancebevestedinsuchsucceedingtrusteejointly withtheremainingtrustees.referencetothetrusteeshallmeanthetrusteeor Trusteesforthetimebeinghereunder.OftheoriginalTrustees,fourshallhold officeuntiljuly1,2017andthreeshallholdofficeuntiljuly1,2018. Section6 MeetingsoftheTrust MeetingsoftheTrustshallbeheldnotlessthanquarterlyandatallothertimes deemedadvisableatsuchtimeandatsuchplaceasthetrusteesshalldetermine. Awrittennoticestatingtheplace,day,hourandagendaofeachMeetingofthe TrustshallbepostedatTownHallatleasttwo(2)businessdaysbeforethedate ofsuchmeeting.aquorumatanymeetingshallbeamajorityofthetrustees qualified. Meetings may be scheduled as needed in conformance with the requirementsofthemassachusettsopenmeetinglaws. Section7 PowersofTrustees TheTrustees,forthecarryingoutoftheabovepurposesandexceptashereinotherwisespecificallyprovided,shallhavethesamepowerswithrespecttoallreal andpersonalestateatanytimeheldbythemasiftheyweretheabsoluteowners thereof,andwithoutlimitingtheforegoinggenerality: a) tosolicitandacceptgrants,gifts,devisesandbequestsorotherwise acquirerealorpersonalproperty; b) toinvestanyofthetrustpropertyinsuchmannerastheymaydeem advisable without being limited as to the kind or amount of any investment; c) to sell and exchange any real or personal property or any interest thereinforsuchconsiderationanduponsuchtermsandconditionsas theydeemadvisable; d) tojoinwithothersintheacquisitionofrealpropertyoranyinterest therein; e) toborrowmoneyandmortgageorpledgeanypartofthetrustestate assetsandissuenotesorotherindebtedness; f) tojoinwithothersinborrowings,mortgagesandpledgesandtoguaranteeandbecomesuretyonobligationsofothers,intransactionsin whichthetrusthasaninterest; 33

34 g) toexecute,aslessororlessee,leases; h) to restore, construct, repair and maintain buildings and other improvements and establish such reserves as they deem necessary therefore; i) to pay, compromise or adjust all obligations incurred and rights acquiredintheadministrationofthetrust; j) toobtainadviceofcounselandtorelythereon; k) to employ such other persons, agents, brokers, managers, accountants,oradvisorsastheymaydeemadvisable; l) and to execute, acknowledge and deliver all such contracts, deeds, mortgages, leases, discharges, and partial releases of mortgages, or other instruments as they may deem advisable in the course of the administrationofthetrust. TheTrusteesshallrefrainfromexercisinganypowersinsuchmannerastoviolatetheprovisionsofsaidChapter44,Section55C. Section8 LimitationsonthePowersofTrustees Thesepowersshallbesubjecttothefollowinglimitations: a) any purchase, sale, lease, exchange, transfer, or conveyance of any interestinrealpropertymustbeapprovedbyfiveofthesevenvoting members. b) the Trustees may incur debt, borrow money, grant mortgages, and pledge Trust assets only in an amount not to exceed 80% of the Trust'stotalassets. c) nodebtincurredbythetrusteesshallconstituteapledgeofthefull faithandcreditofthetownofmanchester-by-the-seaandalldocumentsrelatedtoanydebtshallcontainastatementthattheholderof anysuchdebtshallhavenorecourseagainstthetownofmanchester-by-the-sea with an acknowledgement of said statement by the holder. Section9 ActsofTrustees AmajorityofTrusteesmayexerciseanyorallofthepowersoftheTrusteeshereunderandmayexecuteonbehalfoftheTrusteesanyandallinstrumentswiththe sameeffectasthoughexecutedbyallthetrustees.thetrusteesmay,byinstrumentexecutedbyallthetrustees,delegatetoanyattorney,agentoremployee suchotherpowersanddutiesastheydeemadvisable,includingpowertoexecute, acknowledgedordeliverinstrumentsasfullyasthetrusteesmightthemselves andtosignandendorsechecksfortheaccountofthetrusteesofthetrust.the TrusteesshallnotdelegatetheauthoritytoamendorterminatetheTrustandno suchdelegationshallbeeffective.notrusteeshallberequiredtogivebond.no license of court shall be required to confirm the validity of any transaction enteredintobythetrusteeswithrespecttothetrustestate.noonedealingwith thetrusteesneedinquireconcerningthevalidityofanythingthetrusteespurport to do or see to the application of anything paid to or upon the order of the Trustees.NoTrusteeshallbeliablefortheacts,negligenceordefaultsofany othertrusteeoranyemployee,agent,orrepresentativeofthetrusteesselected withreasonablecare,norforerrorsinjudgment,normistakesoflaworfactmade ingoodfaithnorinrelianceingoodfaithonadviceofcounselnotforotheracts oromissionsingoodfaith. 34

35 Section10 Liability NeithertheTrusteesnoranyagentorofficeroftheTrustshallhavetheauthority tobindthetownofmanchester-by-the-sea.thetrustisapublicemployerand thetrusteesarepublicemployeesforthepurposesofg.l.chapter258.the Trust shall be deemed a municipal agency and the Trustees special municipal employeesforthepurposesofg.l.chapter268a. Section11 Amendments ThisDeclarationofTrustmaybeamendedfromtimetotimeexceptastothose provisionsspecificallyrequiredunderg.l.chapter44section55candmanchester-by-the-sea By-laws, by an instrument in writing signed by all of the Trusteesandapprovedatameetingcalledforthatpurpose,providedthatineach case,acertificateofamendmenthasbeenrecordedwiththeregistryofdeeds andfiledwiththelandregistrationoffice. Section12 Accounts ThebooksandrecordsoftheTrustshallbemaintainedbytheTownTreasurerand auditedannuallybyanindependentauditorinaccordancewithacceptedaccountingpractices.theresultsoftheauditshallbeprovidedtothetown. Section13 DurationoftheTrust ThisTrustshallbeofindefiniteduration.However,itmaybeterminatedbya voteoftownmeetingprovidedthataninstrumentoftermination,togetherwith acertifiedcopyofthetownmeetingvote,aredulyrecordedwiththeregistryof DeedsandtheLandRegistrationOffice. UponterminationoftheTrust,subjecttothepaymentoformakingprovisionforthe paymentofallobligationsandliabilitiesofthetrustandthetrustees,thenetassets ofthetrustshallbetransferredtothetownofmanchester-by-the-seaandheldby theboardofselectmenforaffordablehousingpurposes.inmakinganysuchdistribution,thetrusteesmaysellalloranyportionofthetrustpropertyanddistribute thenetproceedsthereofortheymaydistributeanyoftheassetsinkind.thepowersofthetrusteesshallcontinueuntiltheaffairsofthetrustareconcluded. Section14 AuthorityshownbyRecordtobeConclusive;CertificateastoFacts Everycontract,deed,mortgage,leaseandotherinstrumentexecutedbyamajorityoftheTrusteesasappearsfrominstrumentsorcertificatesrecordedwithsaid RegistryofDeedsandLandRegistrationOfficetobeTrusteeshereundershallbe conclusiveevidenceinfavorofanypersonrelyingthereonorclaimingthereunder,thatatthetimeofthedeliverythereofthistrustwasinfullforceandeffect andthattheexecutionanddeliveryofsuchinstrumentwasdulyauthorizedbythe Trustees except that delegations of authority pursuant to Section 9 hereof and instrumentsofamendmentpursuanttosection10hereofandaninstrumentofterminationpursuanttosection12hereofshallbeconclusiveonlyifitappearsthat the delegations, amendments or termination have been executed by all of the Trustees.AnypersondealingwiththeTrustpropertyortheTrusteesmayalways relyonacertificatesignedbyanypersonappearingfrominstrumentsorcertificatessorecordedtobeatrusteehereunderastotheidentityofthethencurrent Trusteesorastotheexistenceornon-existenceofanyfactorfactswhichconstituteconditionsprecedenttoactsbytheTrusteesorinanyothermannergermane totheaffairsofthetrust. 35

36 Section15 Titles ThetitlestothevariousSectionshereinareforconvenienceonlyandarenotto beconsideredpartofsaidsectionsnorshalltheyaffectthemeaningorthelanguageofanysuchsection. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL (WiTH A vote OF 5-4) The Board of Selectmen recommends approval ARTiCLE 19. ToseeiftheTownwillvotetoraiseandappropriate,transferfromavailablefundsorborrowasumofmoneyforthepurposeoffinancingthefollowing water pollution facility projects: repair, replacement and/or upgrade of septic systemspursuanttoagreementswiththeboardofhealthandresidentialpropertyowners, includingwithoutlimitationallcoststhereofasdefinedinsection1ofchapter29cofthe GeneralLaws;todeterminewhetherthisappropriationshallberaisedbyborrowingfrom themassachusettscleanwatertrustorotherwiseandrepaidbypropertyowners,ortake anyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor ARTiCLE 20. To see if thetown will amend the Manchester by the Sea Town General By-laws by adding a new Section 20C toarticle X: Short Term Paying GuestsinHomesasfollows,ortakeanyotheractionrelativethereto. Article X Section 20C: Short Term Paying Guest in Homes Purpose: Therentalofresidentialpremisestoshorttermpayingguests,nototherwiseexpresslylicensedforsuchpurposebytheTownofManchesterbytheSea orotherproperauthority,shallbeallowedonlyinpropertieswhoseownershave obtained an annual license in accordance with the requirements of this by-law fromtheboardofselectmen.thelicensingprocessisdesignedtoprotectthe healthandwelfareoftheshorttermpayingguests,toensureanorderlyandtransparentprocessforoperatingsmall-scalerentalservices,andtoprotectthetranquilityofresidentialneighborhoods. Applicability: Therentalofresidentialpremisestoshorttermpayingguestsis allowed in owner-occupied residential premises pursuant to being licensed in accordancewiththisby-lawandconsistentwiththetown szoningby-law.short termpayingguestsarethosewhoarestayinginadwellingunitforlessthan6 consecutive nights. The Board may allow short term paying guests provided suitable accommodations exist as determined by the Board in accordance with thisby-law. Process: Every owner of residential premises who offers rentals to short term payingguestsmustfirstobtainalicensetodosofromtheboardofselectmen. Licensesarevalidforacalendaryearandmustberenewedannually.ApplicationforalicensecanbemadeatanytimebutthelicenseshallexpireDecember 36

37 31ofthesubjectyear.Acompletedapplicationwillbereviewedandadecision renderedatapublicmeetingoftheboardofselectmen. Applications: Application shall be made on a form approved by the Board of Selectmenandshallcontainsufficientinformationtodeterminetheexactnature oftheproposedshorttermrentaloperation,includinglocation,numberofrooms toberentedandwhetherfoodwillbeservedtotheguests. Bycompletingtheapplication,applicantswillbeconfirmingthefollowing: 1. ThepropertycomplieswithapplicableBoardofHealthregulationsandFire Departmentsafetymeasures(fire/smokealarmsandCOmonitors) 2. Acertificateofoccupancyforthepropertyisonfile 3. Nameofalocalauthorizedagentwhocanactonbehalfoftheownerinthe absenceoftheownerinthecaseofanyproblems,violationsoremergencies shouldtheyarisewhiletheownerisnotpresent. 4. Agreementtomaintainaguestregistryshowingthenameofeachguestand thenight(s)oftheirstay.theregistryshallbemadeavailableforreviewat anytimeattherequestoftheenforcementagentand/orboardofselectmen. Application Fee: TheBoardofSelectmenshallannuallysetafeeforapplying forashorttermguestrentalhomelicense.thefeemustbepaidattimeof application. TheBoardofSelectmenmaygrantlicensestothosepersonssubmittingapplicationsincompliancewiththerequirementsofthisby-law.Alicenseissuedunder thisby-lawshallnotbedeemedtosupersedetheapplicationofanyotherlawful requirementsapplicabletotheuseauthorizedtherein,includingthenecessityof obtainingotherlicensesorpermits. Ownersareencouragedtoadheretoguidelinesfortheshorttermrentalofrooms thattheselectmenshallpromulgatefromtimetotime. Complaints and Enforcement: 1. TheBoardofSelectmenmaydesignatesuchTownofficialsastheydeemappropriatetocarryouttheenforcementdutiesunderthisby-law.TheTownAdministratorshallsuperviseenforcementactions. 2. IftheEnforcementAgent,asdesignatedbytheBoardofSelectmen,concludes thattherehasbeenaviolationofthisby-laworoftheconditionsofanylicense issuedhereunder,theagentshallsendnoticetothelicenseholder,byregistered mailtotheaddressstatedontheinitialapplication,anoticeorderingcessation oftheimproperactivities. 3. Ifalicenseholderpersistsinsuchviolation,theEnforcementAgentmayseek enforcementofthisbylawthroughthemechanismssetforthinarticlei,section 4oftheGeneralBy-laws,andthepenaltyforviolationsofthisby-lawshallbea fineof$300foreachdayanoffenseoccurs. 4. Intheeventthatalicenseholderpersistsinsuchviolations,theBoardmaynotify thelicenseholderbymail,asabove,ofahearingtobeheldnotlessthanfour(4) daysthereaftertoshowcausewhysaidlicenseshouldnotberevoked,andfollowingsaidhearing,mayinitsdiscretion,modify,revokeoramendthelicense. 37

38 5. Uponpetitionofthepropertyownerand/orlicenseholder,abutters,oruponits owninitiative,theboardofselectmenmayholdahearingtodeterminewhether ornotthetermsofthisby-law,anyotherapplicablestate,federalorlocallaw,or thelicenseitselfarebeingcompliedwith,and/orwhetherornotactivitiesconducted pursuant to a license issued under this bylaw constitute a nuisance or adverselyimpactthepublichealth,safetyorwelfare. 6. The Board of Selectmen may, after hearing, mandate licensure, or modify, revokeorsuspendalicenseissuedhereunder.inaddition,shouldtheboardof Selectmen,afterconductingahearing,determinethataviolationhasoccurred,it maydirecttheenforcementagenttoseekenforcementofthisby-lawassetforth inparagraph3,above. validity: Theinvalidityofanysectionorprovisionofthisbylawshallnotinvalidate anyothersectionorprovisionthereof.thisbylawshallgointoeffectjanuary1,2017. PerpetitionoftheBoardofSelectmen WE WiLL MAKE OUR RECOMMENDATiON ON THE TOWN MEETiNG FLOOR The Board of Selectmen recommends approval ARTiCLE 21. ToseeiftheTownwillvotetoincreasethegrossreceiptsthat seniorsmayhaveinthepriorcalendaryeartobeeligibletodeferpropertytaxesunderg.l. Chapter,59,Section5,Clause41Afrom$40,000totheamountestablishedannuallybythe CommissionerofRevenueastheincomelimitforsingleseniorswhoarenotheadsofhouseholdstoqualifyforthe circuitbreaker stateincometaxcreditfortheprecedingstatetax year,withsuchincreasetobeeffectivefordeferralsgrantedfortaxesassessedforanyfiscal yearbeginningonjuly1,2016,ortakeanyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor ARTiCLE 22. ToseeiftheTownwillacceptG.LChapter59,Section5, Clause 17E, which authorizes an annual increase in the asset (whole estate) limit for exemptionsgrantedtoseniorcitizens,survivingspousesandsurvivingminorsunderg.l. Chapter59,Section5,Clause17D,bythepercentageincreaseintheU.S.Departmentof Labor,BureauofLaborStatistics,ConsumerPriceIndexforthepreviousyearasdeterminedbytheCommissionerofRevenue,tobeeffectiveforexemptionsgrantedforany fiscalyearbeginningonorafterjuly1,2016,ortakeanyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor ARTiCLE 23. ToseeiftheTownwillacceptG.L.Chapter59,Section5, Clause41D,whichauthorizesanannualincreaseintheincome(grossreceipts)andasset (wholeestate)limitsforexemptionsgrantedtoseniorcitizensunderg.l.chapter59,section5,clause41c,bythepercentageincreaseintheu.s.departmentoflabor,bureauof 38

39 LaborStatistics,ConsumerPriceIndexforthepreviousyearasdeterminedbytheCommissionerofRevenue,tobeeffectiveforexemptionsgrantedforanyfiscalyearbeginning onorafterjuly1,2016,ortakeanyotheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor ARTiCLE 24. To see if the Town will accept G.L. Chapter 59, Section 5C1/2, which provides for an additional real estate exemption for taxpayers who are grantedpersonalexemptionsontheirdomicilesunderg.l.chapter59,section5,includingcertainblindpersons,veterans,survivingspousesandseniors,andtoprovidethatthe additionalexemptionshallbeupto100%ofthepersonalexemption,tobeeffectivefor exemptionsgrantedforanyfiscalyearbeginningonorafterjuly1,2016,ortakeanyother actionrelativethereto. PerpetitionoftheBoardofSelectmen WE RECOMMEND APPROvAL The Board of Selectmen will make its recommendation on the Town Meeting Floor ARTiCLE 25. ToseeiftheTownwillvotetoamendtheZoningBy-lawof thetownofmanchesterbytheseabyreplacingsection6.1.2initsentiretywiththefollowing;ortakeanyotheractionrelativethereto: Changes, Extensions and Alterations: :Anexistingnon-conformingstructureorusemaybechanged,extended, or altered, provided that the Board ofappeals grants a special permit for the change,extension,oralterationbaseduponafindingthattheresultingstructure orusewouldnotbesubstantiallymoredetrimentaltotheneighborhoodthanthe existingnon-conformingstructureoruseasdefinedinsection6.1.1inthezoningby-laws.thisrequirementdoesnotapplytoachange,extension,oralterationofasingleortwo-familyresidentialstructureonalotwithinsufficientarea, frontage,orwidth,providedthatthelotcontainsatleast60%oftherequiredarea, frontage,andwidthandthatthetotalfootprintofthebuildingwillnotincrease bymorethan25%fromthatoftheexistingfootprint,andaslongastheresulting structure will comply with all the other area and dimensional requirements of Section5.4oftheZoningBy-laws. PerPetitionof10ormoreResidents WE RECOMMEND THE ADviCE OF THE PLANNiNG BOARD The Board of Selectmen recommends the advice of the Planning Board ARTiCLE 26. ToseeiftheTownwillvotetoraiseandappropriateortransferfromavailablefundsasumofmoneytotheStabilizationFund,ortakeanyotheraction relativethereto. PerpetitionoftheBoardofSelectmen WE WiLL MAKE OUR RECOMMENDATiON ON THE TOWN MEETiNG FLOOR The Board of Selectmen will make its recommendation on the Town Meeting Floor 39

40 ARTiCLE 27. ToseewhatsumofmoneytheTownwillvotetoappropriateortransferfromavailablefundsforthepurposeofreducingthetaxrate,ortakeany otheractionrelativethereto. PerpetitionoftheBoardofSelectmen WE WiLL MAKE OUR RECOMMENDATiON ON THE TOWN MEETiNG FLOOR The Board of Selectmen will make its recommendation on the Town Meeting Floor Andyouaredirectedtoservethiswarrantbypostingattestedcopiesthereof,oneatthe TownHallBuilding,oneatthePoliceStation,oneattheFireHouse,oneattheMemorial School,andoneatthePostOffice,twenty-one(21)days,atleast,beforethetimeofholdingsaidmeeting. Hereof fail not to make due return of this warrant, with your doings thereon, to the TownClerkthree(3)daysbeforethedayofthismeeting. GivenunderourhandsatManchester-by-the-Sea,aforesaid,this7thdayofMarch2016. BOARDOFSELECTMEN: ThomasP.Kehoe,Chairman MargaretF.Driscoll,ViceChairperson PaulM.BarclayEliG.Boling SusanM.Beckmann TotheTownClerk: IhaveservedtheforegoingWarrantbypostingattestedcopiesthereofasdirectedby theby-lawofthetownandthecommonwealth. Constable DateofPosting ReceivedbyTownClerk 40

41 FY-2017 BUDGET TOWN OPERATING, ENTERPRISE (WATER & SEWER), & DEBT 13,761,538 SCHOOL OPERATING & DEBT 14,845,367 NORTH SHORE AGRICULTURAL & TECHNICAL SCHOOL 86,657 CAPITAL ITEMS 2,023,100 OTHER ARTICLES 655,745 CPA ARTICLE 727,500 NON-APPROPRIATED EXPENSES 473,530 TOTAL FY-2017 BUDGET $32,573,437 Chart 1 Budgeted Expenses 41

42 EXPENDITURES GENERAL GOVERNMENT $4,258,542 PUBLIC SAFETY $3,125,697 PUBLIC WORKS $1,689,006 OTHER ENVIRONMENTAL $70,084 HUMAN SERVICES $293,386 CULTURE & INFORMATION SERVICES $449,917 PARKS & RECREATION $447,142 DEBT SERVICE $1,968,816 ENTERPRISE FUNDS (WATER & SEWER) $1,458,949 MANCHESTER/ESSEX REGIONAL SCHOOL DISTRICT $13,320,239 MANCHESTER/ESSEX REGIONAL SCHOOL DISTRICT DEBT $1,525,128 NORTH SHORE AGRICULTURAL & TECHNICAL SCHOOL $86,657 CAPITAL IMPROVEMENTS $2,023,100 COMMUNITY PRESERVATION ACT (CPA) $727,500 WARRANT ARTICLES $655,745 NON-APPROPRIATED EXPENSES $473,530 TOTAL EXPENSES $32,573,437 Chart 2 Expenditures 42

43 TOWN DEPARTMENT EXPENSES GENERAL GOVERNMENT $4,258,542 PUBLIC SAFETY $3,125,697 PUBLIC WORKS $1,689,006 OTHER ENVIRONMENTAL $70,084 HUMAN SERVICES $293,386 LIBRARY $449,917 PARKS & RECREATION $447,142 DEBT SERVICE $1,968,816 ENTERPRISE FUNDS $1,458,949 TOTAL ARTICLE 4 $13,761,538 Chart 3 Town Department Expenses 43

44 SUMMARY ARTICLE 4 SALARIES $5,603,468 EXPENSES $3,616,481 HEALTH INSURANCE $1,559,928 PENSION $1,012,845 DEBT SERVICE $1,968,816 TOTAL ARTICLE 4 $13,761,538 Chart 4 Summary Town Expenses 44

45 REVENUES LOCAL TAXES $25,801,523 STATE AID $223,949 LOCAL RECEIPTS $1,864,500 ENTERPRISE FUNDS (WATER & SEWER) $2,317,233 COMMUNITY PRESERVATION ACT (CPA) $727,500 AVAILABLE FUNDS $1,638,732 $32,573,437 Chart 5 Revenue FY

46 ESTIMATED LOCAL RECEIPTS MOTOR VEHICLE EXCISE 800,000 BOAT TAX 16,000 MEALS TAX 45,000 PENALTIES & INTEREST ON TAXES 65,000 PAYMENTS IN LIEU OF TAXES 4,000 CHARGES FOR TRASH DISPOSAL 87,000 OTHER CHARGES FOR AMBULANCE 144,500 FEES 75,000 RENTALS 150,000 CEMETERIES 16,000 RECREATION - BEACH PASSES 120,000 LICENSES AND PERMITS 282,000 FINES & FORFEITS 50,000 EARNINGS ON INVESTMENTS 10,000 TOTAL ESTIMATED LOCAL RECEIPTS 1,864,500 Chart 6 Estimated Receipts 46

47 NON-PROPERTY TAX REVENUE WATER & SEWER RATES 2,317,233 ESTIMATED LOCAL RECEIPTS 1,864,500 COMMUNITY PRESERVATION 727,500 UNDESIGNATED FUND BALANCE (FREE CASH) 826,845 STATE AID 223,949 OVERLAY SURPLUS 125,000 AVAILABLE FUNDS 686,887 6,771,914 Chart 7 Non-Property Tax Revenue NON-PROPERTY TAX REVENUE 6,771,914 PROPERTY TAX REVENUE 25,801,523 32,573,437 Chart 8 Property Taxes vs. Non-Property Taxes 47

48 Chart 9 Reserves as a Percentage of Total Operating Budget Chart 10 Current MBTS Debt Total Amount Outstanding 48