Finance Committee Recommends Creation Of Stabilization Fund For Reparations

Report On The Meeting Of The Finance Committee (June 10,2021)

The meeting was held via zoom and was recorded.  The recording can be found here.

Present: Andy Steinberg (Chair, at large), Dorothy Pam (District 3), Cathy Schoen (District 1), Lynn Griesemer (District 2), Pat DeAngelis (District 2)

Nonvoting Community members: Jane Sheffler, Bernie Kubiak and Bob Hegner

Staff: Town Manager Paul Bockelman, Finance Director Sean Mangano

Stabilization Fund for Reparations
As directed at the last Finance Committee meeting on May 27, the Town Manager proposed the creation of a special purpose Reparations Stabilization Fund to be used to support “reconciliation and repair for the harms done to Black people of African heritage” . The Town proposes to seed this fund with $210,000 from free cash in FY22. It could be managed as an endowment, somewhat similar to the Jones Library endowment, with the funds being invested, and an annual draw of perhaps 4 percent to fund reparations. In subsequent years, a revenue stream would need to be identified, possibly from free cash in excess of five percent of the budget. The fund could likely be set up to also accept donations, supplementing the town’s contributions. A process for determining how to spend the funds is not yet determined but Griesemer suggested it could be managed similarly to the Community Preservation Act funds whereby proposals for specific funding projects are reviewed.

Schoen worried about over-promising if the fund earned less than 4 percent per year, and Hegner agreed that perhaps the amount withdrawn yearly could be linked to the earnings. Kubiak warned that these should be guidelines, not mandates, and the use of the funds should be at the discretion of the African Heritage Reparations Coalition (AHRC). 

Michele Miller, founder of Reparations For Amherst (R4A), thought the Town Manager’s memo was “great”. She wondered if the AHRC could borrow against the fund. Mangano was unsure if that would be possible. Miller noted that Evanston, Illinois has a subcommittee that determines possible uses of their reparations fund and recommends them to the Town Council.

FINCOM unanimously passed the motion to create the Stabilization Fund for Reparations.

Report on Third Quarter Budget
Through March 31, the Town had collected 80 percent of its projected revenue and spent 72 percent of budgeted expenditures. Snow and ice removal was only 96 percent of the amount budgeted.  Although income from the Enterprise Funds (water, sewer, parking) and local receipts were decreased because of the pandemic, expenses were down as well. The Town expects there to be unspent appropriations due to decreased staffing and other savings. Because of good management and the availability of federal COVID relief funds, there will most likely be a surplus for this year.

Public Forum on Capital Improvement Fund
Mangano proposed putting forth an override for the school project, which would maintain funding for the other three major building projects (the DPW, fire station and Jones Library).  Schoen asked if the Town could propose an override for less than the total amount of the school if the Town had capacity to borrow some of the money for the school project. Mangano thought the override had to be for the full amount, but he was not sure.

Schoen was worried about the optics if the override for the school was put to a vote in November 2022, the same time as the Town was borrowing money for the DPW, but she understood the need for the override to preserve money for other capital costs, such as maintenance or roads, sidewalks or buildings.

Continued Discussion of Funding The CRESS Program
Griesemer said she would like to revise the motion she made and that was passed on May 27, regarding directing the Town Manager to seek [grant] funds to fill eight community responder (CRESS) positions. Griesemer deleted wording about funding “the other elements of the program” and added language on plans for implementation and evaluation of the program, and how funding would be assured in FY23.

Steinberg said that, according to Rules and Regulations (section 7.5), Griesemer can move to reconsider the motion at the next meeting which is this one. Schoen made an additional amendment to fund the program with up to eight responders with multi-year funding. DeAngelis objected to the limit of eight responders, when ten or twelve may be needed.

Kubiak wanted to leave the option open to purchase services from an agency, so that the responders do not need to be Town employees. Greisemer said the motion leaves the implementation up to the Town Manager. All supported the amended motion except DeAngelis. The motion requires the Manager to report back to the Council on his plans for implementation and ongoing funding by January 31, 2022.

At the end of the discussion, Toni Cunningham, a resident of District 1, voiced her disappointment in the motion. She said she believed it was the Council’s responsibility to give direction on how to fully fund the CRESS program, not something that should be put on the shoulders of the Town Manager. She said relying on unspecified grants jeopardizes a successful launch of the program and reduces its chances of success. She added that not filling the vacant positions in the Police Department would both free up some funds and help remedy the over-policing of communities of color, highlighted in the CSWG and 7Generations Movement Collective consultants reports.

Optional Tax Exemption
Veteran’s surviving spouse, Disabled Veteran, Surviving Parents or Spouse, Legally Blind and Seniors who qualify by income and assets are eligible for a reduction in their property taxes. Ninety-one residents qualified for exemptions in the last year. The State pays some of the owed property tax to the Town, but the Town usually allows a bigger deduction than the State standard. The Council must okay the exemptions yearly, before July 1.  Schoen recommended that the Assessor’s office publish the income limits for the exemptions with a flyer to go out with the fall tax bills to communicate the program to those potentially eligible.  Principal Assessor, Liz Duffy, said she will also visit the Senior Center to inform seniors of the tax exemption program.

The FINCOM did not set a date for its next meeting.