MAYOR DONALD F. HUMASON JR.
WESTFIELD – According to Mayor Donald F. Humason Jr. and Auditor Christopher Caputo, Westfield’s revenues in fiscal year 2021, which begins July 1, are expected to be $8.1 million less than expenses due to the novel coronavirus pandemic.
Humason said Westfield is not alone, and every city and state in the country is facing the same shortages. “My fellow mayors, we’re all in the same boat,” Humason said, mentioning recent conversations he has had with colleagues in Chicopee, Holyoke and Northampton.
Humason said in Westfield the main losses are expected to come from a cut in state aid, and losses in hotels, meals and excise taxes.
Right now, he and Caputo are operating on the premise that state aid will be cut by 10 percent on the city side and the school side, as it was after 9/11 and the economic recession in 2007.
But he said the cuts could be larger.
Caputo said a 10 percent cut in state aid equals a $4.6 million loss.
Other anticipated losses are in hotels and meals taxes. “People aren’t traveling; they’re not staying in hotels, not going to restaurants, not doing as much purchasing,” Humason said, adding that restaurants that are doing curbside meals don’t have the alcohol sales. The total anticipated loss in revenue for both is expected to be $700,000. “We have just $50,000 in the budget now,” Humason said
Excise taxes will also be down due to the loss of new car sales. “We need people to buy new cars,” Caputo said. He said the difference is when people buy a new car, they pay $700 to $800 in taxes while an old car may cost $50. “It adds up quickly,” he said.
Humason said he was recently talking to a car dealership owner who said they have a huge backlog of new cars in inventory.
Humason said property taxes, which are just about half of the city’s receipts, are holding strong. “Thank God they haven’t been negatively impacted,” he said, adding while they are down $2.5 million, the city gave an extension to June 1 to pay them.
He also said houses are still selling. “The real estate market is still hot. It’s a seller’s market right now,” he said.
“My message going into this year was that the financial condition was pretty strong. Nobody could have anticipated the impact COVID-19 would have on the financial situation on the city, state and federal level,” Humason said.
“We met with all the departments and department heads for one round a couple of months ago. Then new numbers started coming in, and we needed a new round. Some departments we met for the third time,” Humason said.
“We asked our department heads to reduce their ask to be more in line with the revenue we expect to receive. They’ve all been really helpful. The problem is, everyone of us is worried about the bottom line. The good news is we seem to think we’re okay at this point,” he said.
Humason said the School Department, whose budget is larger than the city’s share, is the last department they’re meeting with. He said they told the School Committee they needed to cut over $4 million from their April 6 budget proposal of $64,394,820.
On May 28, the district will be presenting a new budget proposal to the School Committee at a Special Meeting at 6 p.m. The School Committee will then vote on the budget at its regular meeting on June 1.
Humason said one of the biggest factors impacting the city’s budget preparations is that the state hasn’t done a budget yet. Normally the House would have a budget proposal in April; the Senate in May, then a committee would meet and hammer out a compromise for a vote by the end of June.
He said this year, the House hasn’t even met to look at a budget yet, and the speaker was on record last week saying he wanted to go slow and look at what the federal income would be. “Terrible for cities and towns,” Humason said.
Humason said states are required to have a balanced budget by July 1, and the state will be planning to do a 1/12 budget, based on actual receipts from June. “It will be based on the real numbers, and they won’t be good numbers,” he said, adding that he hopes that Gov. Charlie Baker will file that budget soon, which will go through the legislature informally, “because they can’t amend it.”
Humason said he did have a conversation three weeks ago with Congressman Richard E. Neal, who, at the time, was very hopeful that money would come from the federal government for the states in a new stimulus package, which is now mired in politics.
“It’s all a guess. My fellow mayors are all hopeful that we’ll hear soon,” Humason said. He said their biggest fear is that it will all go to Boston. “It has to be shared. It can’t just be for the urban capitals.”
Humason said if federal relief comes to the states and filters down to the cities, then they won’t have to make all of the cuts.
“For any new mayor, their first budget is a big deal. I know coming in what I had planned – this is not at all what I expected,” Humason said
“We’re going to get through this. It will be hard in the short term, but we’re not alone. Every other city and state is going through the same problem,” Humason said, adding, “I think we’re going to get through it.”
