Tuesday turned out to be a sorrowful day for taxpayers who live in Chatham.

The week had looked promising.

The Selectmen had taken a big step towards reducing spending – and avoiding any increase in property taxes – by unanimously asking all town employees -- union and non-union alike – to accept a voluntary across-the-board freeze in compensation. All had to agree. By our calculation that would save taxpayers more than $700,000 or 70% of the million in reductions needed to keep the property tax levy at the fiscal 2009 level. The Selectmen asked for employee responses by this week.

Then the Selectmen changed their meeting schedule for this week, adding a special Friday meeting (tomorrow) to deal with the responses. That seemed like good news.

Tuesday’s meeting opened with the Public Forum. Chatham Concerned Taxpayers thanked the Board of Selectmen for the close attention they seemed to be showing to the concerns of taxpayers in “these extraordinarily difficult, indeed unprecedented, times.” (Note: CCT is just forming; our first meeting was February 3rd. We’re still digging, still learning and there’s much still to learn. What we say is what we know so far.)

CCT briefly reviewed the above-inflation growth in town spending of over 44% in the past eight years that had to stop. During those years the town’s employees had handsomely benefitted with excellent pay and benefits. But the good times, at least for now, were behind us. Federal statistics were showing ZERO INFLATION, a strong argument against any pay increases in these tough times. .

We reminded the Selectmen that more than half of Chatham’s adult residents were of retirement age or nearing retirement. Chatham’s population is one of the oldest in Massachusetts. They are “hurting”, we said, using the words of a similarly disposed Selectman of Brewster. They are “scared” as they see their nest eggs dwindle.

Though many think of Chatham as a rich town, according to publicly available information, the median household income of Chatham is below even that of neighboring Brewster, and far below that of a rich town such as, say, Weston, $153,918.

We suggested that the Selectmen ask the representatives of the employee groups – school union, police union, fire union and other municipal employees – to appear at Friday’s Selectmen meeting in person to deliver their responses to the request of the Selectmen for an across-the-board freeze. We said “We certainly hope that they will show appreciation for the past generosity of the Chatham taxpayers and an understanding of the anxiety and fear that those past their earning years are now feeling in these very difficult times. With their cooperation, Chatham can hopefully get through this next fiscal year without imposing additional financial burdens on already stressed taxpayers.”

We noted that an added benefit of the Selectmen’s proposal would be keeping all or almost all public employees employed without the need of major layoffs.

We closed by urging caution for what could be even worse times ahead. “As residents tighten their belts, the town must do the same.”

Well, that was the end of hope for the taxpayers, at least as far as the Selectmen were concerned. Or so it appeared.

Immediately thereafter, Town Manager William Hinchey informed the Selectmen that the fire union had rejected the Selectmen’s request, although the non-union employees had agreed to it if they could avoid layoffs. The police and school unions hadn’t bother to respond.

In the following exchange between Mr. Hinchey and the Selectmen, “some taxpayers” were accused of “panicking” and one selectman maintained that he for one wasn’t going to panic. Indeed, he could live with the property tax increases including an override and if there was to be a battle at town meeting, so be it.

One of the written principles adopted by the Selectmen for this year had been to avoid any override. (State law permits but does not require an increase in the property tax levy of 2.5% each year; anything beyond that requires a vote of town meeting be it for an override (excess spending in the operating budget), a capital exclusion or a debt service exclusion.) The town spending plan proposes almost a 5% increase in the property tax in the operating budget, requiring about one million dollars in reduction in a $32 million spending plan to avoid property tax impact.)

Not another word was said about the across-the-board freeze or the fact that two unions had refused to respond to the Selectmen.

The Selectmen then proceeded for the next two hours with spending as usual. The first thing they did was vote cost of living increases for all town employees outside the school department; the cost of living increases for school employees are already in the school budget as other pay increases. The Town Manager argued that since the Board had just recently approved (4-1) the new fire union contract he had negotiated giving the union a 7% increase for fiscal 2010 (at a time when cost of living figures were plunging towards zero), it was obligated to give them their 3% cost-of-living increase. (The other 4% of the fire union’s 7% increase was already in the fire budget). Selectmen then voted cost-of-living increases for the other town employees.

Not a single reduction in spending was made by the Selectmen. In fact, several spending items were added off-budget as it were by taking from emergency funds money raised in prior years in excess of what was needed. It was difficult to follow what the Town Manager and Selectmen were doing because they were working from papers the public in attendance did not have. Free cash was tapped for this, the Stabilization Fund for that involving hundreds of thousands of dollars, perhaps more. The School Department 10% spending increase came down somewhat because of health insurance costs came in lower than estimated and the magical injection of off-budget money from the Stabilization Fund. One member of the audience rose at one point to state what she believed was the unspoken obvious: The real “elephant in the room” is the chronic and unsustainable overspending by the schools.

Overall, the sole reduction in spending came about because health care insurance final figures came in below what was estimated. At the end of the discussion, the Selectmen were still proposing an operating budget that raises property taxes in excess of 2.5% and requires an override vote at Town Meeting, an override they had pledged to avoid.

The Selectmen led by the Town Manager then went on to adopt and approve Articles for Town Meeting that will ask for spending for capital projects that will also raise property taxes. Only Chairman of the Board Summers on several occasions brought up the concerns of the town’s resident taxpayers and questioned what was essential capital spending and what could be deferred. Nothing was deferred.

Tomorrow’s Selectmen’s meeting at 5 (new time) is supposed to wrap up discussion on the town’s operating budget. Will any reductions in spending be proposed or adopted if proposed? Will the police and school unions deliver their answers to the Selectmen’s request for a compensation freeze? Based on Tuesday’s Selectmen’s actions, neither is likely.

The taxpayers’ hopes now lie with the Finance Committee (Chairman, Coleman Yeaw), which will formally receive the Selectmen’s recommendations in a few days. They meet Thursdays a 7 at the Town Hall and live on Channel 18 and by video later on the Town’s website.

It’s beginning to look more and more as if the taxpayers who live in Chatham will have to fight for themselves at Town Meeting.

The Selectmen have a difficult job. The Town Manager is a master at what he does. They are all intelligent and diligent. But their actions Tuesday reflected their apparent judgment that the stress being suffered by those in Chatham who pay the bills because of the financial crisis did not warrant any change in the course of their projected spending, that the town could afford it. The town, of course, is that Chatham household with median income of $45,817 which will be voting at Town Meeting in May.