The Chelsea City Council approved a request from City Manager Tom Ambrosino to reorganize and significantly increase the City’s reserve accounts.
On Monday night, the Council voted to transfer $15 million into the Stabilization Fund and approved an additional $5 million transfer into a newly created School Stabilization Fund. In conjunction with these moves, three existing savings accounts were consolidated, with approximately $300,000 directed to the Stabilization Fund.
Councillor Bob Bishop initiated these requests last month and chaired a committee meeting two weeks prior to discuss the proposals.
Bishop has advocated for building up the Stabilization Fund, citing the need for the City to accumulate greater reserves as protection against potential economic downturns. The advantage of keeping funds in the Stabilization Fund, he noted, is that it grants the Council stricter oversight of expenditures, since any withdrawal requires a two-thirds Council vote.
City Manager Ambrosino expressed support for both transfers and characterized the School Fund as a prudent decision, given several upcoming school projects scheduled for the City. “fblikebutton_button” All of these initiatives, he noted, are included in the Capital Improvement Plan.
The Council also took action on related financial matters, approving a final $3 million payment toward the Clark Avenue Middle School project. The City has been making cash payments on the ongoing construction project—expected to conclude this summer—to minimize interest expenses associated with borrowing.
State reimbursements are also contributing to the project’s funding.