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Nashua spending cap to be decided in voting booth next year

Union Leader Correspondent

November 26. 2013 9:53PM

NASHUA — The Board of Aldermen on Tuesday agreed to let voters decide whether to change the way the city calculates its spending cap.

Aldermen voted to place the proposal on the ballot next November. Registered voters will be asked to amend a portion of the city charter concerning limitations on budget increases, a request made by 1,655 residents in the form of a citizen’s petition earlier this year.

According to Brian McCarthy, president of the Board of Aldermen, it is the board’s statutory duty to move the proposed resolution forward, however it is not the duty of the board to facilitate a public debate on the topic since the request was prompted from a citizen’s petition — not the city.

The petition, spearheaded by Gary Hoffman, Karen Costura-Hoffman, Maida Latvis, Judith Loftus and Susan Giudici, seeks to change the process in which the city determines how much the annual budget can increase each year.

Currently, the spending cap is determined by the average of the Consumer Price Index Urban (northeast region) throughout the past three years. The petition is asking to change the measure of inflation used in the city’s spending cap from the CPI-U to the Implicit Gross Domestic Product Price Deflator for State and Local Services as measured by the Bureau of Economic Analysis.

The change, according to the petitioner’s committee, will more accurately measure cost increases to municipal expenditures. The S&L IPD is a more accurate measure of inflation when trying to measure the costs associated with running local government, according to the Citizens for a Smarter Spending Cap website.

Not everyone agrees this is a wise change, however.

While it is not the duty of elected officials to campaign in favor or against the proposal, Alderman Dan Moriarty warned his colleagues about the possible charter amendment.

“The reason this amendment is being proposed is to increase spending,” maintained Moriarty, adding this will in turn increase taxes for local property owners.Officials said the change could potentially add $4 million to the budget. However, Alderman Diane Sheehansaid it would also change the percentage of where the spending cap is set. “We don’t budget at the cap, regardless,” Sheehan said.

Alderman Barbara Pressly questioned whether there would be additional public meetings allowing voters a venue to further understand the pros and cons.

“It is not going away quietly,” stressed Alderman Arthur Craffey, adding supporters and opponents have agreed there will be more public debate on the spending cap issue.

On Monday, former alderman Fred Teeboom spoke out against the proposal during a hearing before the aldermanic Personnel and Administrative Affairs Committee.

One of the petitioners, Hoffman, said previously it is irresponsible to use the CPI to measure the cost of city government, arguing it is designed for consumers.

The existing spending cap in Nashua is 2.3 percent, which equates to $5.6 million, according to Griffin. The city’s fiscal year 2014 budget is $381,670 below the spending cap.

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