Attleboro City Hall building file photo

Attleboro City Hall is partially reopening to the public for business transactions.

ATTLEBORO — There’s bad news and good news on the city’s budget, Mayor Paul Heroux said Friday.

The bad news is a three-month state budget approved by the Legislature and headed to the desk of Gov. Charlie Baker has left the city $2 million short in its $143.8 million spending plan for fiscal year 2021, which started on July 1.

The good news is the city has the cash to cover the deficit.

Heroux said he will use $1.4 million in surplus cash left from fiscal year 2019 to replace most of it.

The rest will be covered with whatever the city has for a surplus from FY 20, which ended on June 30.

Those numbers are typically certified by the state in the fall.

The city council must approve the move, but Heroux said using surplus cash will prevent layoffs or furloughs and preserve the city’s $4.5 million stabilization account, which has been built up over a number of years.

“My number one budget priority is to avoid layoffs in every department,” he said.

The new budget numbers are based on an August through October, $16.5 billion state budget.

Heroux built his budget based on the governor’s preliminary budget issued in January before the coronavirus pandemic hit and the state instituted a shutdown to stop its spread.

The state lost billions of dollars in tax money. Those losses are trickling down to cities and towns.

About $1.77 million of the $2 million cut by the state was headed for the school department, the mayor said.

The rest was general government local aid.

Heroux said he’s anticipating a surplus of about $3 million from FY 20.

Typically the city spends down its annual surplus, also known as “free cash,” by the end of a fiscal year, the mayor said.

Usually it’s spent on one-time expenses, especially capital projects.

However, Heroux said he decided not to do that this year because of the state’s budget problems.

“If we had spent that money we’d be in trouble,” Heroux said in a telephone interview Friday afternoon. “We anticipated this might happen so we saved up for it.”

The city council cut about $436,000 from Heroux’s original FY 21 budget as a hedge against likely state cuts.

Heroux said he plans to restore a $200,000 cut to the special education stabilization account and he will also add $300,000 to the city’s stabilization account.

He also plans to restore money to replace the fire department’s kitchen at Union Street Station.

Heroux warned that there may be more bumps in the road ahead, but overall he’s optimistic that the virus will be conquered and the economy will regenerate.

“There are still many unknown variables and we will continue to adapt as we learn more. I am reasonably optimistic that a vaccine will be created by early next year and tens of millions of doses will become available shortly thereafter,” he said in an emailed statement. “This will lead to a stabilization in the markets and a return to local business practices, which will then lead to a stabilization in local receipts and state revenues, ultimately stabilizing this self-induced economic coma and accompanying budget crisis we have been dealing with.”

George W. Rhodes can be reached at 508-236-0432.

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