A couple of fiscal matters from Tuesday’s Lowell City Council meeting warrant discussion. The first was a transfer of $1.1 million from the FY24 Certified Free Cash Account to the Lowell Police Department “to support various equipment needs.”

As a reminder, “free cash” – which is the source of these funds – is surplus money left at the end of a fiscal year. At the start of each fiscal year, the council adopts a balanced budget that accounts for all revenue and then directs how that revenue is to be spent. But government operations can be unpredictable. Sometimes money allocated for a particular purpose cannot be spent due to factors beyond the control of the city, so that money is left over at the end of the fiscal year. Likewise, if the city’s revenue estimates that form the basis of the budget are exceeded by the amount of revenue collected through the year, then the extra money is left over.

For governmental entities like state or federal agencies, not spending money in the budget by the end of the fiscal year means that money reverts to the funding authority, but that’s not how it works in city government. The legislature allows municipalities to keep that extra money as “free cash” provided its first “certified” by the state department of revenue. Once certified, free cash can be used for many purposes, although maintaining much of it as a reserve or “rainy day” account is prudent and, perhaps more importantly, it leads bond rating agencies to score the city’s finances as more fiscally sound which results in lower borrowing costs which saves the city money in the long run through lower interest payments on bond debt.

For some reason, FY24 ended with the city holding a substantial amount of free cash. Much of that excess has already been used for other purposes, but a good chunk remains. The memo accompanying this proposed vote explained that the fund from which the money was being taken had been set up as a “pay-as-you-go capital account designated for municipal building improvements” but the money was not needed for that purpose right now.

Of the $1.1 million being transferred, $612,500 will be spent on police body camera expenses and $487,500 is for new police vehicles. A deputy police chief was present to answer council questions. I believe he said that the body camera expenditure was an annual fee rather than a one-time payment. It sounds like the city has a comprehensive contract with the company providing the cameras that includes online storage of the video recorded by the cameras along with a rolling replacement of a portion of the physical cameras each year. The same company also provides the police with tasers which are also partially funded by this expenditure.

Video requires an enormous amount of digital storage and housing all that data is not cheap. Conceivably the city could do it in-house, but that would require a substantial expenditure on IT equipment, software and personnel so it’s probably most efficient to outsource it. Still, computer companies succeed by getting customers to spend a lot of money on a recurring basis. It’s much more lucrative for them to ensnare the customer with high annual fees than to just make a one-time sale of equipment. None of the councilors drilled down on this issue, pressing the city manager on whether the police are paying for the bare minimum of what is needed or have they chosen the Cadillac option.

Speaking of automobiles, that brings us to the second expenditure. The deputy chief explained that the front-line vehicles used by the police department have a very short lifespan. These vehicles operate year-round, 24 hours per day, 7 days per week and log nearly 45,000 miles per year. As new vehicles are acquired, the replacement vehicles are handed down to other bureaus within the police department where instant reliability of the vehicle is not as critical.

Someone explained that whereas the useful life of a fire engine or DPW dump truck is 15 years and therefore made part of the city’s capital spending plan, police cruisers, with their 3-year life expectancy, are typically part of the city’s annual operating budget.

A few councilors pushed back on this proposal with some arguing that both items are normal operating expenditures that should have been funded by the FY27 budget the council enacted last June. Others didn’t like the idea of taking money slotted for building repairs (mostly school repairs) and spending it on recurring operating costs. A motion to refer this request to the council’s finance subcommittee was defeated after which the vote to make this transfer passed with (7) yes votes from Councilors Sokhary Chau, John Descoteaux, Belinda Juran, Sidney Liang, Rita Mericer, Vesna Nuon and Corey Robinson; and (3) no votes from Mayor Erik Gitschier and Councilors Sean McDonough and Kim Scott.

It’s not a good sign when money in a reserve account is needed four months into the fiscal year to pay for two things that are normal operating expenses which should have been funded in this year’s budget. The exact same expenses will exist next year, only there won’t be a money reserve to tap since it was already spent this year. At some point, the math doesn’t work. But for now, this fiscal issue has been kicked down the road until the FY2028 budget is discussed next spring.

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The second fiscal matter discussed by the council was a vote to “raise and appropriate $1.5 million to the Lowell Fire Department to support the hiring of 14 new firefighter recruits.” Unlike the police transaction, which was a transfer of existing funds, this proposal would raise this $1.5 million from the city’s normal revenue sources during the current fiscal year. While that sounds like an increase in taxes, it seems that city revenue is being collected at a pace that exceeds budget protections which would leave a surplus of funds at the end of the fiscal year. Rather than devote that to free cash for future use, the council by this vote has opted to spend the money in the year it’s received. This also means that the FY2028 budget for fire department personnel will already have a $1.5 million increase baked into it which might require a property tax increase next year to cover this cost going forward.

As for the purpose of this money, the memo supporting this action explained that while the Lowell Fire Department is authorized 213 firefighters, it currently employs just 196. This discrepancy contributes to the high cost of overtime since a minimum number of fire fighters must be on duty for each shift, and the lesser number currently employed eliminates any personnel cushion to cover for illness, injury, vacation and other absenteeism.

The memo goes on to state that three new hires are “currently enrolled” in firefighter academy training and that this appropriation will allow the city to hire an additional 14 recruits which would bring the number of firefighters up to the fully authorized amount of 213.

While hiring a dozen and a half new firefighters should help with staffing, the department continues to lose personnel to retirement on a regular though unpredictable basis. Nevertheless, staffing closer to 213 than to 196 should help, although it comes at a cost.

Speaking of costs, a line in the supporting memo caused Councilor Belinda Juran to have some understandable trepidation. The line in question read, “By strengthening our workforce, the City hopes it can meaningfully curb overtime expenditures helping to ensure that annual overtime costs remain below the $4 million threshold . . .” (emphasis supplied).

Councilor Juran’s concern was that by its very terms, the memo said this new expenditure of $1.5 million would at best keep overtime costs at the current $4 million per year level (which is higher than it’s ever been before) with seemingly no hope of reducing it.

The council passed the proposal unanimously.

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If you’re interested in what else happened at the council meeting, the agenda is online and the full YouTube recording of the meeting is here. If you want to view a particular portion of the meeting but don’t want to sit through the entire 3 hours and 26 minutes that this one lasted, YouTube has a handy feature that synchs the items on the agenda to the time in the recording when that item was discussed. Underneath the YouTube viewing window is a line that (currently) says, “794 views.” Underneath that is a link that says, “…more.” If you click on that, the meeting agenda will display with each item on the agenda preceded by the time stamp when that item was discussed. Just click on the timestamp and it brings you to that part of the video.

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If you haven’t already voted, remember that the state election is this Tuesday. If you’re heading to the polls to vote in person, be sure to bring your answer key for the nine referendum questions that are on this year’s ballot.

In my newsletter two weeks ago, I briefly explained the purpose of each of the nine questions and the implications of voting yes or no. If you need a quick reminder of the questions, here’s a link to that newsletter.

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There were a couple of Halloween related posts on richardhowe.com this week. First, Henry Marchand wrote about the world’s most famous escapologist and musician, Harry Houdini, who died on October 31, 1926.

Then, Leo Racicot wrote about favorite Halloween candies from the 1950s & 1960s.

Louise Peloquin shared a report from an Open House hosted by the UMass Lowell Library.

Charlie Gargiulo wrote a review of Louise Peloquin’s fictionalized account of attending a Catholic girls boarding school here in New England in the 1960s. The book, Boarding School Blues, is available through online print-on-demand.

Finally, in Wednesday’s Seen & Heard column, I wrote a book review of Sword Beach: D-Day Baptism by Fire by Max Hastings; reported on a great art exhibition at the Addison Gallery of Art in Andover; noted an historical obituary of Lowell’s Harry “Bucky” Lew, the world’s first Black professional basketball player; and commented on a podcast the featured the journalist James Marriott talking about “the end of reading” in modern culture.