Finance Committee

Meeting Type: Finance Committee Meeting Governing Body: Somerville City Council Meeting Date: June 18th, 2025 Attendees:

• Jake Wilson, Councilor at Large, Finance Committee Chair
• Will Mbah, Councilor
• Willie Burnley, Councilor
• Jesse Clingan, Councilor
• J.T. Scott, Councilor
• Kimberly Wells, City Clerk
• Matt Sano, Superintendent of Inspectional Services
• Angela Allen, Chief Procurement Officer
• Ann Gill, Director of Human Resources
• Ellen Collins, Deputy Director of HR
• Rene Mello, Worker's Compensating Manager
• Lisa Jones-Brinkley, Benefits Manager
• Kristen Hill, Recruitment and Retention Manager
• Jessica Paveo, HR Admin Manager
• Sue Yerkes, Parks and Recreation Director
• Linda, Finance Manager, Parks and Recreation
• Yanni Taragades, Director of Operations, Parks and Recreation
• Gregory Jenkins, Director of Arts Council
• Mike Mastroboni, Budget Director
• Ed Bean, Finance Director
• Cheryl Cruz, Deputy Treasurer
• Nick Dervis, Deputy Collector
• Chief Assessor Golden

Executive Summary: The Finance Committee convened for its third night of departmental budget hearings for the proposed FY2026 budget. Key discussions included Inspectional Services' efforts to track short-term rentals and enforce the vacant properties ordinance, the City Council's budget, and the City Clerk's office's readiness for new licensing types. Human Resources addressed increases in health and life insurance costs and pension contributions. Parks and Recreation discussed budget allocations, enterprise fund projections, and the impact of capital projects on future operating costs. The meeting concluded with a review of non-departmental items, including debt service and the city's capital planning strategy.

• Chair Jake Wilson called the meeting to order at 6:01 p.m.
• The meeting was conducted via remote participation as per Chapter 2 of the Acts of 2023.
• Roll Call:
  • Councilor Mbah: Present
  • Councilor Burnley: Present
  • Councilor Clingan: Present
  • Councilor Scott: Present
  • Chair Wilson: Present
• A quorum was established.

• Chair Wilson welcomed attendees to the third night of departmental budget hearings for the proposed FY2026 budget.
• He acknowledged counselors' submitted questions and the new format for budget season, including an additional Monday night meeting for follow-up questions.
• Motions for cuts or resolutions for additional funding would be tabled until "cut night" on Tuesday, June 24th.

• Short-Term Rentals:
  • Councilor Burnley inquired about investments to track short-term rentals, noting reduced software allocation.
  • Superintendent Matt Sano stated ISD is exploring options for proactive identification, acknowledging current software is more reactive.
  • Chair Wilson mentioned attending the Mass Municipal Association conference and speaking with vendors offering sophisticated software for tracking short-term rentals and potential revenue generation. He expressed interest in following up with Director Bean and ISD on these options.
• Vacant Properties Ordinance:
  • Councilor Scott asked about the enforcement of the vacant properties ordinance, noting its absence in the departmental memo.
  • Superintendent Sano indicated that staff allocation would need to be reviewed and suggested discussions on potential updates to the ordinance to make it more enforceable for ISD.
  • Councilor Burnley inquired if a supplemental allocation would be appropriate for enforcement or if the administration sought changes to the ordinance. Superintendent Sano expressed openness to discussions on updates.
• Staffing and Vacancies:
  • Councilor Burnley asked about vacancies in ISD.
  • Superintendent Sano reported that a building inspector position is filled and will start in the new fiscal year, bringing all staff-level positions to full capacity, except for the director position.
  • Councilor Burnley questioned if current staffing levels would be sufficient to meet inspectional needs and expedite the permitting process. Superintendent Sano stated they are in a "pretty good place" but acknowledged process improvements could always be made.
• Permitting Process Simplification:
  • Councilor Mbah asked about steps ISD is taking to simplify and improve access to permitting and inspection services, especially for non-English speakers and first-time applicants.
  • Superintendent Sano stated that optimizing applications and permitting processes, creating better materials, and addressing language barriers are goals for FY2026.
• Motions: No motions were made regarding Inspectional Services.

• In-State Conferences:
  • Councilor Burnley asked why the budget for in-state conferences was exceeded.
  • City Clerk Kimberly Wells explained that more counselors attended the Mass Municipal Association Conference than in previous years, leading to the overage. The FY2026 budget has been increased to reflect this.
• Budget Static Nature and Legal Services:
  • Councilor Burnley noted the generally static nature of the City Council budget over the years and the "relative de-funding of the legal services line."
• Motions: No motions were made regarding City Council or Clerk of Committees.

• Motions: No questions or motions were made regarding the City Clerk's budget.

• New Licensing Types:
  • Councilor Burnley inquired if additional funding would be needed to create new licensing types, specifically mentioning cannabis hospitality, event organizer, and supplemental licenses.
  • City Clerk Kimberly Wells stated no additional funding is needed, as the council previously provided funding for an additional position in the City Clerk's office, which is supporting the infrastructure for new license types. The primary remaining factor is state regulations and framework.
• Motions: No motions were made regarding the Licensing Commission.

• Special Items Allocation:
  • Councilor Mbah inquired about a $529,000 "special item" listed in the May 29th memo for the Law Department.
  • Budget Director Mike Mastroboni clarified that the $529,000 is allocated to Human Resources, not the Law Department, for items such as union-related educational programs, fluency bonuses, and the MBTA PASS program.
• Outside Litigation and Contract Work:
  • Councilor Mbah asked about outstanding outside litigation or contract work, noting supplementary appropriations for FY2025.
  • City Solicitor stated that the recent finalization of the water and sewer outflow project contract required a recent appropriation.
• Judgments and Settlements:
  • Councilor Mbah questioned the discrepancy in numbers for judgments and settlements, specifically regarding the $60 million payment for 90 Washington Street and the FY2026 budgeted amount.
  • Budget Director Mike Mastroboni clarified that the $60 million settlement for 90 Washington Street was a supplemental appropriation in FY2025. He also explained that "building insurance" and "judgments and settlements of claims" are separate programs but appear in the same report. The FY2026 budgeted amount for judgments and settlements is $250,000.
• Legal Assistance Programs:
  • Councilor Mbah asked if costs for legal assistance for immigrants and low-income tenants were under the Law Department.
  • City Solicitor stated these costs fall under the SomerViva budget.
• Online Subscriptions:
  • Councilor Burnley noted that FY2025 actuals for online subscriptions exceeded the budgeted amount by approximately $4,000 but the FY2026 allocation remained at $12,000.
  • City Solicitor explained that the department procured some additional helpful subscriptions and discontinued others, resulting in a net neutral effect on the budget line.
• Motions: No motions were made regarding the Law Department.

• Motions: No questions or motions were made regarding Damages to Persons and Property.

• Braille and Accessibility:
  • Councilor Burnley inquired about the city's acquisition and usage of a Brailler and its role in providing Braille ballots.
  • Chairman Salerno explained that the city uses "auto-mark machines" in every precinct, which have Braille capabilities for voters with disabilities, allowing them to mark their ballots independently.
• Motions: No motions were made regarding Elections.

• Motions: No questions or motions were made regarding Auditing.

• Grant Writer Vacancy:
  • Councilor Scott asked about the vacancy in the grant writer position and its hiring status.
  • A representative from Grants Development (Kelly, Grants Administrator) clarified that the position has a 9/1 start date, not 7/1, and has been impacted by a hiring freeze but the job has been posted and candidates are in the pipeline.
• Motions: No motions were made regarding Grants Development.

• In-State Travel:
  • Councilor Burnley noted that in-state travel actuals were approximately three times the allocated amount in FY2025.
  • Chief Assessor Golden explained this was due to the need for two assessors to obtain accreditation, requiring travel to Southbridge and Plymouth for in-person education. He anticipates the line item will decrease as they become accredited.
• Printing and Stationery:
  • Councilor Burnley inquired about a $7,000 increase in printing and stationery.
  • Chief Assessor Golden stated this increase is due to various mailings, including residential exemption notices and the annual finance newsletter, which was transferred from the Treasury Department to streamline efficiency.
• Motions: No motions were made regarding Assessing.

• Printing and Stationery Transfer:
  • Councilor Clingan acknowledged the $6,500 transfer for printing and stationery from Treasury to Assessing.
• Motions: No questions or motions were made regarding Treasury.

• Motions: No questions or motions were made regarding Building Insurance.

• Disparity Study Recommendations:
  • Councilor Burnley asked how the recommendations from the disparity study would impact the department's workload in FY2026.
  • Chief Procurement Officer Angela Allen stated that the department is actively evaluating recommendations to determine what can be done with existing resources and what may require more. She emphasized the importance of filling the recently vacated Deputy CPO position for data reform. She also mentioned meetings with Boston and Cambridge procurement offices to learn about implementation practices.
• Motions: No motions were made regarding Procurement and Contracting Services.

• Special Items Budget:
  • Councilor Mbah inquired about a $500,000 "special item" in the HR budget.
  • Deputy Director Ellen Collins explained that this budget covers union-related educational programs, fluency bonuses, and the MBTA PASS program for benefit-eligible city employees.
• Benefit Expenditures:
  • Councilor Mbah asked about the 10% increase in health and life insurance and 8% increase in pension contributions.
  • Director Ann Gill attributed the increase to astronomical medical insurance costs (GIC) and the hiring of new employees.
• Motions: No motions were made regarding Human Resources.

• Motions: No questions or motions were made regarding Health and Life Insurance and Medicare.

• Motions: No questions or motions were made regarding Workers' Comp.

• Motions: No questions or motions were made regarding Information Technology.

• Budget Changes:
  • Councilor Mbah noted minimal changes in salary and O&M for Parks and Recreation and inquired if the budget contained all required funds for recreation programs and staffing.
  • Director Sue Yerkes confirmed that the budget includes all required funds. She explained that a deeper look into each account line resulted in more accurate individual line increases, even if the overall budget increase was modest (approximately 3%).
• Enterprise Funds (Dillboy, Jenny Smith, Sanders Pool):
  • Councilor Mbah asked about projections for revenues and costs for enterprise funds. Director Yerkes stated that the department views itself as providing services rather than being a moneymaker, and they are partnering with the finance team to review the revenue structure.
  • Chair Wilson followed up on Dillboy field permit fees, noting expected revenues of approximately $150,000, similar to the previous year. He inquired if the opening of Rivas Field had led to a decrease in permitted hours at Dillboy. Director of Operations Yanni Taragades stated that both Revis and Dillboy were permitted equally during a transition period, and high school and youth soccer usage at Dillboy remained similar despite Revis's opening.
  • Chair Wilson asked about the future of retained earnings for Jenny Smith and Sanders Pool, noting a $373,000 balance used this year. Budget Director Mike Mastroboni stated that while they aim to manage costs, an increase in the general fund subsidy is likely next year unless program revenue significantly increases.
• Capital Projects and Future Operating Costs:
  • Councilor Mbah asked about the department's ability to carry forward capital projects listed in the CIP, given the current budget.
  • Budget Director Mike Mastroboni explained that the city's capital planning is at a "turning point" due to starkly different revenue projections. He stated that the next CIP would be "less ambitious and more realistic," focusing on maintaining core services and existing assets rather than expanding them, similar to the general fund budget. He also mentioned the use of alternative funding sources like ARPA and stabilization funds to manage debt.
• Motions: No motions were made regarding Parks and Recreation or its Enterprise Funds.

• Armory Operations:
  • Councilor Mbah inquired about the funding for the Arts Council's increased responsibility with the Armory, noting a lack of specific line items.
  • Director Gregory Jenkins explained that the city is developing an RFP process to lease spaces in the Armory, with a pro forma aiming for a fee structure that provides sustainability while being equitable. He noted that multiple departments (DPW, Arts Council, OSPCD) are already supporting the Armory, creating an economy of scale. No additional "01" (salary) request is made for FY2026.
• Motions: No motions were made regarding the Arts Council.

• Items Reviewed: Salary Contingency, Revolving Funds, PAYGO, Debt Service, Unemployment Compensation, Pension, and State Assessments.
• Debt Service:
  • Councilor Mbah questioned the relatively small increase in debt service despite numerous capital projects.
  • Budget Director Mike Mastroboni stated that FY2026 debt service is budgeted at $22.6 million, an increase of approximately $900,000 from FY2025. He explained that the city manages debt through strategies like reducing borrowing (e.g., $4.7 million from stabilization funds this year, saving $400,000 in debt service next year and $9.6 million over 20 years). He also noted that projects from the past are continually paid off, and new borrowing is added, leading to annual adjustments.
  • Mastroboni confirmed that the city will be slowing down the pace of capital projects due to revenue uncertainty, economic uncertainty, rising interest rates, and contractor availability.
• Motions: No questions or motions were made regarding non-departmental items.

• Chair Wilson asked if any departments needed to be called back for additional questions on Monday night. No counselors indicated a need.
• Budget Director Mike Mastroboni encouraged counselors to email IGA with any questions for "cut night" to ensure productive discussions.
• Councilor Mbah moved to adjourn the meeting.
• Roll Call on Adjournment (7:52 p.m.):
  • Councilor Mbah: Yes
  • Councilor Burnley: Aye
  • Councilor Clingan: Yes
  • Councilor Scott: Yes
  • Chair Wilson: Yes
• The motion to adjourn passed unanimously.
• The meeting adjourned at 7:52 p.m.