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HomeMy WebLinkAbout2011-03-28 Finance Committee PacketThe Town of Reading - FINCOM budget meeting http://www.readingrna.gov/Pages/ReadingMA_MeetingCal/SO 16AB6... ~CII ~aY ~ ~ F ~~h1 I a w j - r s ~ t f" t ~ 1 p~7y111 J I ~l l t d I i " 1 _ r nie Residents Businesses FINC OM budget meeting Monday, March 28, 2011 at 7.00 PM RMLD Printer-Friendly Version Google Search COMMON CAUSE -COMMD 1' C'AUSI A Finance Committee >FY12 Budget: Review & Vote For Budget information: please click here >Town Meeting Warrant: Review & Vote For Warrant information: please click here Location: Reading Muncipal Light Department conference room (230 Ash Street) for directions: click here for parking map: click here Next FINCOM budget meeting: March 30 (7pm) - complete Budget & Warrant review/vote (if needed) Location: Town Hall - main floor conference room Town of Reading, Massachusetts 16 Lowell Street, Reading, MA 01867 Website Disclaimer Virtual Towns & Schools Website 1 of 1 9/17/2011 2:29 PM TO: Finance Committee From: Bob LeLacheur, Assistant Town Manager/Finance Director Date: Monday, March 28, 2011 Re: Town Manager's Proposed 2012 Budget FY12 Budget Overview Update on State Aid As of yet there has been no early aid resolution from the legislature. It is possible that we might get one after we go to print but before Town Meeting convenes. To prepare for this possibility, internally staff has discussed FY12 budget priorities with the prospects of additional State Aid. Here is that consensus, in the order as the line items appear for FINCOM votes within each broad category: 1.) The first $150,000 of additional funds (operating budgets): $47,000 to the Town budgets as follows: $6,500 to line 192 Finance expenses for technology ($3,500 for PCs and $3,000 for parts & supplies); $6,500 to line K1 Community Services wages (to increase the 0.8 FTE clerical position to 1.0 FTE for document storage, license & permits, and customer service); $4,000 to line K2 Community Services expenses ($2,650 for animal disposal costs and $1,350 for professional development); $30,000 to line M92 Public Works expenses (for pothole repairs supplies and some new equipment to allow patching in the colder weather); $103,600 to the School budget in line U99; 2.) The next $150,000 of additional funds (accommodated costs): $75,000 to line E99 for possible vocational school expenses; $75,000 to line M92 for possible DPW fuel expenses; 3.) Any amount over $300,000 of additional funds: Reduce the use of free cash in supporting the FY12 budget. Public Requests During the FINCOM FY12 budget review process several suggestions have been presented from the public - in particular from some Boards, Committees and Commissions. Here is a 0 Page 1 summary of those requests, in the order as the line items appear for FINCOM votes: $23,000 to line 191 Finance wages for the seasonal Appraiser position (requested by the Board of Assessors); $19,663 to line K91 Community Services wages to move three administrative positions from 0.5 to 0.6 FTE, in order that they may qualify for health insurance (requested by the Conservation Commission, Board of Health and Council on Aging). Note the minimum requirement for health insurance is 20 hours/week as opposed to 0.6 FTE which is 22.5 hours/week. The total cost to move the three administrative positions to 20 hours/week is $6,521; $1,500 to line K92 Community services expenses for a Trails Committee request (see tonight's enclosure); $28,000 in total for the library ($15,000 to line L91 Library wages and $13,000 to line L92 Library expenses) in order to meet the state requirement of 102.5% versus the last three year average budgets (requested by the Library Director on behalf of the Library Trustees). Possible changes to Town Managers budget - Community Services Town Proposed Miniumum Administrators Manager BCCs for Health Ins. Hours/week 18.75 22.50 20.00 Conservation Elder/Human Services Health Total $ 29,630 $ 35,556 $ 31,605 $ 32,470 $ 38,964 $ 34,635 $ 35,713 $ 42,856 $ 38,094 $ 97,813 $ 117,376 $104,334 $ 5,926 $ 1,975 $ 6,494 $ 2,165 $ 7,143 $ 2,381 $ 19,563 $ 6,521 Cost vs. TM budget 19,563 $ 6,521 (excludes possible health ins. costs) Page 1 of 1 LeLacheur, Bob From: Hechenbleikner, Peter Sent: Monday, March 28, 2011 11:17 AM To: LeLacheur, Bob Cc: Thomas Gardiner - marsie.west@bnyhiellon.com Subject: E: Trails budget request Tom I did get your request as we were putting together the budget, but clearly this was not a year to add anything new. The Conservation Commission has, I believe, a puller for invasive species, and if I am correct certainly some arrangement could be made for its use. The "bammer" I assume is for the installation of the spread footings for boardwalks, and I thought that we were going to purchase that out of the last grant that we got for trail building. If not, when we have another trail project that requires the spread footings, come to me and I will see that we get the equipment that we need. If you get me a list of all equipment we need, as well as a plan for how we are going to insure that it is kept in Town possession, I will see what we can do with some of our local businesses in getting donations. From: LeLacheur, Bob Sent: Monday, March 28, 2011 10:52 AM To: Hechenbleikner, Peter Subject: FW: Trails budget request FYI From: Thomas Gardiner [mailto:thosgardiner@hotmail.com] Sent: Monday, March 28, 201110:36 AM To: Marsie K. West; Finance Subject: Trails budget request Good Morning I am Tom Gardiner the Chairperson of the Trails Committee, I am writing you this morning in support of our request for $1500.00. We realize that the town is facing hard financial times, $400.00 would be for but not limited to the purchase of a Buckthorn pullers(invasive spices) that are choking out native plants a :bammer" for driving post into the ground and a adjustable tree branch toppers The $1100.00 would be used to support various projects in 2011 such as trail improvements and maintenance. We believe this investment would benefit the whole town,people would be able to enjoy nature in their backyards and not have to drive long distances. Thank-you for your time and consideration on this matter. Thank-you Tom Gardiner 3/28/2011 Dear Members of the Finance Committee: We the Reading Public Library Board of Trustees are writing to you to express our deep concern on the proposed budget for Fiscal Year 2012. This year's town budget will force the Trustees to apply for a waiver from the Massachusetts Board of Library Commissioners for Fiscal Year 2012 in order not to lose our accreditation. The Trustees worked diligently and made some very hard choices on ways in which we could provide our staff a raise and be in compliance with the Massachusetts Board of Library Commissioners. In order to meet the town's budget requirements, the Trustees have taken the following actions, which although painful, are now necessary to meet this year's budget constraints: 11 -There will be fewer library pages-hundreds of hours of shelving will now be lost -The Library will close on Saturdays during the summer. Even with these drastic cuts, the Library is still short $27,640.00 per the recommendations from the Municipal Appropriations Requirements. Although hundreds of libraries in the state may be applying for waivers, the Reading Public Library is in the process of applying for a multi-million dollar state grant to renovate and expand our Library. We the Trustees feel that having to apply for a waiver at this time could have an impact on our grant application for a much needed renovation and addition. This grant would enable the Library to grow and serve the greater Reading Community for generations to come. Although all town departments have needs, we the Trustees urge the Finance Committee to reconsider the proposed library budget in order for the Library to retain its accreditation while applying for the state grant. Thank you for your consideration. Regards The Library Board of Trustee T®: Finance Committee From: Bob LeLacheur, Assistant Town Manager/Finance Director Date: Monday, March 28, 2011 Re: Town Manager's Proposed 2012 Budget Motions for FV12 Budget and Town Meeting Warrant Articles FINCOM Warrant Reports - Standard Language (from previous years warrant reports) Standard - Recommendation Finance Committee Report: The Finance Committee recommends the subject matter of this Article by a vote of 8-0-0 at their March 25, 2009 meeting. Standard - Against Recommendation Finance Committee Report: The Finance Committee does not recommend the subject matter of this Article by a vote of 1-4-3 at their March 25, 2009 meeting. Recommendation - Mixed Vote Finance Committee Report: The Finance Committee recommends the subject matter of this Article by a vote of 5-0-3 at their March 25, 2009 meeting. If applied, this could potentially ease water rates charged to residents. Since these funds are not obligated to be applied to Water projects, there was discussion on whether the funds should be allowed to flow to Free Cash in order to be available for the general fund in future years, and then available for Operating or Capital challenges. For the abstaining votes, there was not sufficient information to draw conclusions. Against Recommendation - Mixed Vote Finance Committee Report: The Finance Committee does not recommend the subject matter of this Article by a vote of 0-6-2 at the meeting of March 25, 2009. The committee acknowledged the need for the project and is concerned about the safety issues raised but given the knowledge that in the current economic climate the funding for the construction of the facility is not available, and that the Board of selectmen has not made a decision on the actual site of the facility, it seems premature to approve funding for design. Abstained Vote - Lack of Information Finance Committee Report: The Finance Committee abstained from taking a position relative to the subject matter of this Article by a vote of 0- 0-8 at the March 25, 2009 meeting. The votes to abstain reflect the fact 0 Page 1 that final information on the project to be proposed or the funding to be required was not available in time for an informed decision to be made by the date of the Warrant publication. The Finance Committee may revise this position if more pertinent information becomes available in time to take a vote. Finance Committee Report: The Finance Committee abstained from taking a position on the subject matter of this Article by a vote of 0-0-8 at their March 25, 2009 meeting. The votes to abstain reflect the uncertainty about a final list of FY10 proposed capital as of that date related to the request from the School Committee to re-prioritize capital. Budget Finance Committee Report: The Finance Committee votes are reflected in the budget presentation material. Chapter 90 Funding Vote Finance Committee Report: The Finance Committee recommends the subject matter of this Article by a vote of 8-0-0 at their March 25, 2009 meeting. This is a routine method of authorizing the receipt and application of Chapter 90 funds. In the event Chapter 90 funds are not received, the projects would require alternative funding sources outside the scope of this Article. Capital Plan Vote Finance Committee Report: The Finance Committee recommends the subject matter of this Article by a vote of 8-0-0 at their March 25, 2009 meeting. This Article allows capital requests to be available for funding in a later Article at this Town Meeting. A 10 year balanced capital plan is a prudent fiscal tool that facilitates long range planning and project prioritization. The balanced plan provides the maximum amount the Town can fund each year and stay within the FINCOM guide lined amount. Tangible Asset Disposal Vote Finance Committee Report: The Finance Committee recommends the subject matter of this Article by a vote of 8-0-0 at their March 25, 2009 meeting. This would authorize the disposal of six aging vehicles. FINCOM - WARRANT ARTICLES VOTES "Move to recommend Article of the 2011 Annual Town Meeting" (bold items suggested for vote on 3128/11) 4. FY1.1-20 Capital Improvement Plan 5. Amend the FY11 budget 6. R/a - pestPened 7. Chapter 90 funds 8. Safe Routes to School easements Action Pending 9. Accept Pond View Drive 10. Authorize surplus disposal 11. Approve FY12-21 Capital Improvements Program 12. n/a 13. Ice Arena lease 14. Re-authorize revolving funds 15. School Committee 3+yr contract 16. Green Repair debt 17. Contributory Retirement Board item 18. a a-9-n/a 20-n/a 21. n/a 22. n/a 23. n/a 24. Affordable Housing Trust Fund 25. n 1a - not pr-oper-ly written 26. n/a not nronnrly Witten 27T n/° . not ncrc nro nnrhi written ifTU --larvla c:r-~-v a rrcc~rr 28. Approve FY12 Budget 29. Sick/Vacation Stabilization Fund ARTICLE 28 - FINCOM - BUDGET VOTES Town Finance Manager Committee "Move to recommend the amount of $ in line of the FY12 FY12 FY12 Budget" GENERAL FUND Budget Budget Benefits B99 12,845,486 Capital C99 948,000 Debt D99 6,063,446 Vocational Education E99 369,343 Town Administration wages G91 212,611 Town Administration expenses G92 468,180 Accounting wages H91 156,779 Accounting expenses H92 1,300 Finance wages 191 1,089,226 Finance expenses 192 451,700 FINCOM Reserves J92 150,000 Community Services wages K91 760,959 Community Services expenses K92 237,499 Library wages L91 969,717 Library expenses L92 253,813 Public Works wages M91 2,289,710 Public Works expenses M92 731,930 Public Works Snow & Ice M93 565,000 Public Works Street Lights M94 253,575 Public Works Street Rubbish M95 1,496,680 Public Safety wages N91 7,595,269 Public Safety expenses N92 366,014 School Department & facilities U99 35,902,307 Town facilities V99 699,877 GENERAL FUND 74,878,421 0 Water Enterprise Fund W99 Sewer Enterprise Fund X99 Storm "Water Enterprise Fund Y99 ENTERPRISE FUNDS vote Wednesday night 3 aFRF Qo Finance Committee Meeting f U February 9, 2011 Os3g: lNCORQu Conference Room, Reading Town Hall The meeting convened at 7:30 PM in the Conference Room at Town Hall. FINCOM Members Present: Chair Marsie West, Hal Torman, Mark Dockser, Bryan Walsh, Barry Berman, Kevin Leyne, Francis Fardy and Paula Perry. Members Absent: David Greenfield Also Present: Assistant Town Manager/Finance Director Bob LeLacheur; ~lrthur;,Katz from the Reading Advocate and recording secretary Abby McCabe. There being a quorum the Chair called the FINCOM meeting to order` at 7:39 PM. FY12 Budstet Schedule Overview Mr. LeLacheur reviewed the March meeting schedule with'ale Committee. The March 2nd, 9th, 16th, and 23rd meetings will be held at Reading Municipal Light Department On the homepage there s,--a link to the FYI 2 Budget that posts the meeting calendar and the'complete text and:.-dollar amounts for the operating budget by department. It was recommended that the Town Meeting presentation include more text and less detail on the actual numbers so that it easier to follow. FINC6M should be voting on the budget at the March 28th meeting and vote on the warrant articles on March '30f1'. Snow & Ice Budget Update The FYI 1 snow and ice budget is now over budget by $402,137. The Town's DPW hasn't always had enough staff to clear the large amounts of snow and,has had to contraetf"out some of the work which has contributed to the increased costs. Peading also only has 4 sidewallcplows and for a while 2 were broken and needed repairs. Mr. LeLacheur recommends under-budgeting'for snow and ice because this figure can never be predicted but youtr don't want to cut other service in case there is a winter where there isn't a lot of snow in which case other areas and services would have' been cut for no reason. Therefore, it's better to under-budget and then use reserve funds if `more is needed. Update on Fuel Prices The Financ..o. Director/Assistant Town Manager,.reviewed the monthly fuel prices (diesel and contract prices) 6% cr the past year showy on page 7 of the meeting packet. This is for all town vehicles including police, fire, ~ehbols and DPW vehicles The fuel account for FYI 1 is on target. Meals Tax Update The Town has received A most $26,000 in the local meals tax for the months of October and November. The numbers are reported and. sent quarterly so this only includes October and November but if this number is sustained it willtotal $155,000 for the year. Municipal Building Committee Report The ad hoc Municipal Building Committee's final report is provided on pages 9 -16 of the meeting packet. The Committee visited Town buildings throughout 2010 to understand the existing conditions and identify any major upgrades or maintenance work that would be needed in the future. The final report. ranks priorities for public building projects. 1 Pulte Homes Development Proposal Pulte Homes of New England has submitted a development application with the planning commission for the former Addison Wesley site and a fiscal impact report was included with the application. Mr. LeLacheur has reviewed the report and has provided a memo with his comments and questions provided in the FINCOM meeting packet. The developer is estimating 8 to 10 years before the property is completely built out which is important to note since a common misconception is that the FY12 budget could benefit from this project. This is not necessarily the case since this is a project that will generate revenue over a long period of time due to property taxes and one time fees associated with the Gateway Smart Growth District. It was recommended for FINCOM to follow this projeetand take an active role while it is being developed. One member also noted that this project may also impact or cause a need for new services in Town. It was also mentioned that Reading residents may move to this property thus leaving a single family home that may bring in school aged children. SEC New Rules about Municipal Advisors Finance Committee members are not required to register as "municipal advisors" as outlined in the SEC regulations. Committee members are far enough removed that the regulation requiring one to register as a municipal advisor is not applicable to local government's finance committee members sinc.e they are not generally actively involved in making recommendations on investments: The Board of Selectmen approved the Town Manager's recommended budget earlier this week. The Town Manager's proposed budget will be available to the FINCOM next week. Page 39 of tonight's meeting packet shows the projected revenues for FYI 1 through FY14. Projections show revenues increasing by 2 to 2.5% after FY12 which is bettd but typically we experience a 3.5 to 4% increase. Mr. LeLacheur commented that it is difficult to continue; services with less than a 3% increase. Accommodated costs will likely go iipby 5% in FY13'& FY14. The projected budgeted assumes that the amount of free cash used,to,support the operating budget will steadily decline over the next few years from $1.5 million in Fit, 1,million in- FY13 and $500_OQ;O in FY14. Ms. West asked what the ralnifi`cations were fol usingAhis level of free cash. Mr. LeLacheur explained that communities iii many other states keep their reserve funds at 10% but Massachusetts is different because offhe propositi6n 2:'/ . Reserves are important because they impact a community's ability to borrow money and bond rating agencies like to`see 8%. Many Massachusetts municipalities generally have 56/0 while Reading has typically has had 8 or 9% in reserves. FINCOM Pre-Town Meeting Communications The Committee expressed satisfaetion with the amount of budget information that has been made available to the public through,the website and financial forums. Mr. LeLacheur mentioned that the Board of Selectmen is interested in looking at the employer wage benefits and Town Meeting may be too. The employer contribution fox--health insurance was discussed. The Committee agreed that the example of how the average home owner's taxes are distributed is good and it was suggested to show these numbers in percentages over time to show the past trends. Town Meeting FY12 Budget Presentation Town Meeting is expected to be three nights and Mr. LeLacheur recommended that FINCOM make the presentation early and preferably on the first night of Town Meeting. FINCOM's budget message should be strong and more detailed than usual because Town Meeting members will be looking to the Committee for advice. It was suggested that a letter be mailed in February in advance of Town Meeting. Ways to get Town Meeting members email addresses were discussed. Ms. West, Mr. Dockser, Mr. Berman and Mr. 2 Leyne volunteered to prepare the draft presentation and will report back to the rest of the Committee for feedback at one of the March meetings. The. Finance Director prepared a memo explaining the budget overview for the Finance Department as a model for what the FINCOM might want to consider for each department. The memo includes a summary highlighting the changes as well as figures and charts. The impacts on services and the dollar amounts should be described. Fall 2010 Financial Forum Updates Mr. LeLacheur gave an update on what suggestions from the Financial Forums have been implemented and which ones are being considered for this budget. Several of the expense saving ideas has been implemented. After a brief discussion several FINCOM members ldentf ed cell towers, billboard advertising and parking fees at the train depot as priorities for enhancing revenues. Liaison Reports Mr. Dockser attended a recent Reading Municipal Light Department (RMLD) meeting and reported that he found it surprising that RMLD seemed to have higherthan expected revenues and a stable operating budget. He asked if there was a way the Town could partner more with RMLD to share sonie^of the burden of the current budget problems. Mr. LeLacheur suggested eontactizg RMLD directly for more information but felt that the RMLD already pays the Town a fair, share as part of a previous long-term agreement. On a motion by Mr. Torman, seconded by Mr. ockser. FINCOM anpr oved the minutes dated Januai to 3 aFFFao Finance Committee Meeting March 2, 2011 o f~- ' e s39'INCORQO~P Conference Room, Reading Municipal Light Department The meeting convened at 7:00 PM in the Conference Room at RMLD. FINCOM Members. Present: Chair Marsie West, Vice Chair David Greenfield, Hal Torman, Bryan Walsh, Barry Berman, Kevin Leyne and Paula Perry. Members Absent: Francis Fardy and Mark Dockser. Also Present: Town Manager Peter Hechenbleikner, Assistant Town Manager/Finance Director Bob LeLacheur, Town Accountant Gail LaPointe, Fire Chief Greg Burns, Police Chiehim Cormier, Police Business Manager Andrew Scribner, Community Services Director/Town Planner Jean Delios, DPW Director. Jeff Zager, Town Meeting members Kara Fratto, John Arena and`Karl>_Weld, and recording secretary Abby McCabe. There being a quorum the Chair called the FINCOM meethng to order at 7:05 PM The Finance Director/Assistant Town Manager gave a brief overview ofthe FY12 budget summary and the Town Accountant presented a revenue update. Revenues 'arc similar to last year in that they have stayed relatively flat with a slight increase due to the local meals iax. The Town Manager explained that the proposed budget includes using $1.5 million dollars in cash reserve funds. This budget also assumes a 10% reduction in stat&aid ($1.2 million dollars). Legislative actions that contribute to the overall economic recovery of Reading are-also presented in conjunction with the budget. A focus on customer service, partnerships, s.,ustair ability,. equity, and common practices were some of the guiding principles that led to the final budget before FINCOM. A grant was recently submitted for Reading to share health services with neighboring communities but Reading did not meet the grant program's eligibility requireiilents. Tax asses* Inents, elder services, public health and conservation are areas-under consideration to be shared with-other towns. Some of the proposed legislative actions include rescinding the local:wetlands liy-law, reducing the time requirements stated in the demolition delay general by-law, a by-law requiring property owners to clear snow and ice from the sidewalks, adopt expedited permit procedures in the industrial area of Ash Street and zoning changes to the site plan review requirements. Severa}proposed administrative actions were also reviewed such as a "carry rn carry out" policy for rubbish at t ib parks and schools and the new CAMA system to be implemented iii the Assessor's ofCce. The Town Accountant reviewed t11e major revenue sources in FYI 1 and the projections for the next two fiscal years. Estimates for new ga uwth do not include projects such as the former Atlantic Super Market or Addison Wesley sites because -they are still in the planning stages. Revenue generated from the motor vehicle excise tax is slightly` higher than expected and the local meals tax has contributed to an increase in local revenue where it has been flat for the last few years. A 10% decrease in state aid is projected in the revenue estimates for intergovernmental revenue. Total transfers and available funds are also down in FYI 2 due to appropriations at Subsequent Town Meeting in November. Ms. LaPointe reviewed the cash reserves; this budget uses $1.5 million dollars in reserves and used $1.25 million thus fat in FYI 1. The Town Manager answered questions relative to the three payments from the RMLD and the Reading Ice Arena. Mr. LeLacheur summarized the total spending from the general fund for each department shown in a chart on page 13 of the meeting packet. The school department is the largest part of the budget at 48%. Benefits account for 10% (approximately $13 million dollars) of the budget which is lower when compared with some of the neighboring communities. The Finance Committee will be meeting every Wednesday in March beginning at 7:00 PM in the conference room at RMLD. A Monday meeting will be held on March 28th to allow time for the FINCOM to vote on the budget and the March 30th meeting will focus on the Town Meeting Warrant Articles. Annual Town Meeting will likely be at least three nights. Mr.,LeLacheur reviewed the alternative budgets initially discussed before arriving at the final version and highlighted the major changes. The history of FTE (Full Time Employees) was, also reviewed. A Committee member asked about performance based step increases opposed to th&step increases included in the proposed budget for all employees. The Town Manager explained at no increases were provided to employees last year and that this option was not.recommended because it is not sustainable over time. Another Committee member asked if the salaries could be shown over the labs Cc~t years. Town Administration Mr. LeLacheur reviewed the Town Administration budget in detail. The Administrative Secretary position is eliminated with this budget and the work load will be shared with the. Community Services` Administrative Assistant. Postage and legal expenses are reduced in this`'bndget but legal:. expenses are often difficult to predict. Accounting Department The Accounting department includes 1 full timi2 Town Accountant, a 30 hour per week Accounts Payable clerk, 20 hour per week Administrative Clerk and a 3.75 hour, per week A, isistant Accountant (the Retirement Board Administrator) for a total of 2.45 employees. Overtime and postage are the major reductions in this department made possible by using electronic invoices. Finance Department (Assessors, Finance, Human Resources, Technology, Town Clerk, Elections) The total Finance Departirelit-.budget ~ s reduced by a total of 6.3% for FY12 largely due to technology improvements and staff rearrangements. The Seasonal Appraiser position is eliminated, a reduction of 5.5 hours per week for a -part time clerical positiop dnd-the elimination of the Database Administrator. A lower level technician position is also budgeted to Handle the workload. Professional development funds have beens'ignificantly reduced across all departments but this expectation is not sustainable long term. Police Department Overtime is mereased in the police department budget because the department is not fully staffed currently due to injury or officers serving in the military. There was a brief discussion about the consequences of reducing persoMI. el versus the cost of overtime. The Police Chief stated that crime has increased for all types of crime, particularly felonies in response to a question about the crime statistics in Reading. Fire & Emergency Management Department Salaries have been increased because of existing contractual agreements. Ambulance billing services was discussed and $25,000 is included in the budget. Presently, ambulance billing is done in-house but the department is considering outside companies to perform this function. The Fire Chief is interviewing private ambulance companies that may be able to get bills out faster and keep the cash flow coming in. This is still under review at this time. 2 Public Comment: The Town Manager further explained the proposed by-law requiring property owners to clear the sidewalks of snow and ice in response to a question from the audience. The Town typically plows 43 miles of sidewalk in areas that are well used such as surrounding the schools and parks. A member from the audience suggested adding more discussions and text about projections. for FY13 in the budget summary for Town Meeting members. When asked about benefits, Mr. LeLacheur explained that the Town contributed 71 % to health insurance while employees contributed 29%, which is slightly low for municipal gov crnmats. 3 ~N dFN-RO Finance Committee Meeting e March 9 ,2011 Js39tNCOltp¢P Conference Room, Reading Municipal Light Department The meeting convened at 7:00 PM in the Conference Room at RMLD. FINCOM Members Present: Chair Marsie West, Vice Chair David Greenfield, Hal Torman, Paula Perry, Francis Fardy and Barry Berman. Members Absent: Mark Dockser, Bryan Walsh, and Kevin Leyne. Also Present: Town Manager Peter Hechenbleikner, Assistant Town Manager/ Finance Director Bob LeLacheur, Town Accountant Gail LaPointe, Community Services Director%Town Planner Jean Delios, Library Director Ruth Urell, Police Chief James Cormier, Fire Chief Greg Burns, Board of Selectmen Chair James Bonazoli, Board of Selectmen Steve Goldy, Library Trustees Vicki Yablonsky, Karyn Storti, Richard Curtis, Cherrie Dubois and David Hutchinson, Conservation Committee Chair William Hecht, Council on Aging Chair Steve Osten, Board of Health members Colleen Sefarian and David Singer; CPDC member Paul Bolger, Board of Assessors Chair Bob Nordstrand, Board ofAssessors member Fred McGrane, Appraiser Bill Boatwright, Trails Committee member Will Finch, 'I own,Meeting members John Arer" an'd John Carpenter, Making Reading Better members Erin Calvo-Bacei and Mary Ann Quinn, and Malt Casey from Reading Patch. There being a quorum the FINCOM meeting was called to order at 7: 10 PM. Mr. Greenfield asked to get a report on the suggested' leg islative actions in the proposed Town Manager's budget and the cost savings assigned to each of the 'k ,r,z is appropriate. Community Services Mr. LeLacheur reviewed the 'f~ Y 12 budget for Commuiai.ty Services; including the proposal to regionalize three administrative functions (Conservation, Elder/Hurna_n Services and Health), which would have the effect of making these each 05FTE positions in the budget= eliminating the position of permits coordinator, sharing the Administrative Assistant with the Town Manager's office; reducing the plumbing/gas and wiring inspectors from 20, to l6-houurs per week, incrtasrng tl e'Veteran's services Officers hours due to heavy caseloads, and adding a 0,8 FTE clerical' position to handle customer service and document storage needs of the departmet. This latter position may be left unfilled at the beginning of the year to ascertain the impact of these other el?anges to the level-b.-f Customer service, as well as the impact on the new License & Permits software system He pointed to ;'staffing survey of local communities that showed the following: Conservation average 1.2 FTES, proposed Reading budget 0.7 FTEs; Elder/Human Services average 3.9 FTES, proposed Readi lg budget 4.3.`FTEs; and Health average 3.0 FTES, proposed Reading budget 3.1 FTEs. Mr. Hecht presented a proposal that would add back hours for the three regionalized positions to a 0.6 FTE status (22.5hrs/week) in order to give those positions health insurance, and help retain the current staff. In order to pay for this increase - including benefits, the proposal called for an unspecified further reduction to . the planning staff, and the elimination of the new 0.8 FTE clerical position. The net effect of this change would be to further reduce staffing in the department from the 14.7 FTE level in the Town Manager's budget to 14.0 FTEs - down from 16.9 FTEs in FYI 1. Mr. Hechenbleikner mentioned that no presumed savings in health insurance were made because of these changes, and that in fact the Town expected to pay half of such costs once the positions were shared with another town. Mr. Hecht amended his remarks to allow for less of a reduction than was proposed. Mr. Arena suggested that the choice was between these three positions and less planning staff. Mr. LeLacheur pointed out that the cost for health insurance eligibility would be substantially less than the proposed 0.6 FTEs because 20hrs/week was needed, and that in any event the proposal included a new clerical position in addition to the planning staff, so the choices were broad. Mr. Bolger (CPDC) said that the planning staff was essential for the economic development activities in Town, and that there were several large projects (Oaktree, Pulte Homes, MF Charles Building) that required a great deal of staff time. Ms. Delios said the planning staff was busy with in-depth site plan review work as directed by the CPDC on these and other projects. Mr. Carpenter mentioned that planning is a local activity that cannot be shared with other communities and should not be reduced. Mr. Osten said the Council on Aging this week voted 7-0-0 in support of the plan put forward by Mr. Hecht. Ms. Sefarian (Board of Health) said that no reductions to that area should be made because of the concern about health risks for the community. She expressed concern that regionalization of the Health function would not w.&k well at this time because the technology may not be compatible with another Town. A member of the Reading/North Reading Chamber of Commerce expressed disappointment that the Permits Coordinator position was being eliminated, and said that the planning function should not be reduced airy further so that the Town would be able to enjoy commercial economic growth in the future. Mr. Sanger (Board 6f l ealth) also expressed support for the health services function and opposed any reduction's m`this area. N1r. Goldy said that both he and the Board of Selectman supported the concept of regionalized services, and that the.Town has examined many opportunities over the past couple of years. He mentioned that Melrose Mayor Rob Dolan,was also very supportive and interested in partnering with Reading as' was appropriate. They already have shared Health services with Wakefield and it has been a positive experience toAAe,. Mr. Goldy cited other examples including Amesbury and Newburyport, as well as the Franklin Couileii of Governments. Public Library Mr. LeLacheur reviewed the proposed Library buctgc• fir FY12. The budget shows a 0.9% reduction, but when sick-leave buyback funds-voted by November 2010 Town Meeting are~riot included, the reduction is only 0.5%. Before health insurance news came out, this wasthe. average adduction needed of all Town departments. The wage budget is about $15,000 below a ' level service'° budget, so these reductions were all concentrated into thirteen sum=mer Saturdays, when patron activity is at the lowest. Otherwise the Library will remain open and staffed as they are `in FYI 1. Mr. LeLacheur also noted the materials budget was reduced to be about $11;000 below the required State figure.of 15%, and the Library indicated that private funds would make up the difference. Finally,_the budget as proposed is about $28,000 below a State requirement that funding be 102.E% of the aver age fro=m the past three years. A waiver from that is available - over one hundi ed'MA coimunities sought and-received the waiver for FYI 1. Ms. Urell reviewed the proposed budget and mentioned the increased demand for services from the community at a time when the economy was.faltering. Ms. West asked abottt .h6 waiver for the 102.5% requirement, and Ms. Urell indicated that: Keading would likely-be eligible, but she was hesitant to ask because the building project application is pending , and there is the possibility of securing $5 million in state funding. Mr. Greenfield asked about the impact of becomingdecertified, and Ms. Urell indicated that about 60,000 of the 500,000 in annual circulation were due to interlibrary loans. That amount would not be allowed if the library were decertified. Mr. Hechenble:ikner rioted that the Library was retaining state aid funds for the circulation system that was already inAJre: capital plan; and Ms. Urell indicated that amount had grown to $97,000, and these funds can be used to„ake up any shortfall in the =materials budget. The capital plan for April 2011 Town Meeting will be amended to remove the circulation system because of the proposed building project. Mr. Hechenbleikner noted that if the building project did move forward, there would need to be contingency plans on relocating the Library services on a one-to-two year temporary basis as construction occurred. Funds for relocation are included in the project budget. Ms. West asked why full services had to be offered for every hour the Library was open, and Ms. Urell said that less services was not a desirable option. Mr. Hutchinson said that the Library was already at a minimum level of staffing, and that the proposed staff reductions in FYI 2. were difficult. Five page positions - usually staffed by school students - would be eliminated for a savings of $5,600, and that 1,500 books/day would need to be shelved by other staff. Ms. West asked about volunteer pages, and Mr. Berman asked if the Library had any ideas on new sources of 2 revenues. Mr. Torman asked for a further explanation of the $97,000 in state aid that was not used in recent years. Mr. Berman asked for an update on the Library project. Ms. Urell and Mr. Hechenbleikner mentioned that there was funding for about six projects and that 30 communities had applied. Issues addressed would include ADA requirements, repairs to the infrastructure, as well as expanded square footage and improved foot traffic patterns. Mr. Hutchinson said from here on any further budget cuts would translate into less hours of service to the public. He noted that it is not simply a matter of cutting an hour here and there, that staff work schedules needed to be considered. Mr. Arena asked if the one-year waiver from the State would reset the baseline for future requirements, and suggested user fees for cards. Ms. Yablonsky said that no fees could be charged for cards. Mr. Farnsworth asked about the projections for children and subsequent Library programs, and Ms. Urell responded that the Library uses MAPC data to respond to the demographics of the community. Assessors Mr. LeLacheur quickly reviewed the Assessors budget as part of the Finance d„hartment. He mentioned that the seasonal appraiser position was eliminated, and that in the future during a triennial revaluation year that some level of outside consulting services would be required.,,,,- oard of Assessors meiltb;er Mr. McGrane noted that 70% of Town revenues come from taxes. Board of Assessors Chair Bob Nordstrand noted that their mission was to find and tax all parcels in Town fairly and equitably. He stated that the imijor duty of the seasonal appraiser position which is being eliminated was to inspect 1/9 of--all properties per year in keeping with the 9-year re-inspection cycle, with a focus on the 6,500 single family homes. He said the position was similar to that of a data collector, and in the 2004 revaluation they were, about 1,000 parcels behind schedule and they hired outside help which resulted in poor quality which even now is just being cleaned up. He warned that there would be less of an overlay su(Plus that is returned to free cash every year, and that new growth might be missed. Mr. Greenfield asked how the 1 work would be, re=assigned. Mr. Hechenbleikner said that the Assistant Appraiser position was actually creatod to do that work, and the seasonal position was added to avoid outsourcing personal, property re-collection needed!-every three years. Despite that, the Assessors have continued to spend about, $25,000 every three years' o outsource the personal property data collection. Mr. Farnsworth: asked what financial costs there were to the Town for past poor quality data, and Mr. McGrane suggested that a lot of possible revenue wds~Iost. Mr. Greenfield asked how this was possible since the 2.5% levy was assessed every ycar,_,. "yam Finance Committee Meeting t+ U March 16, 2011 639ilNCORp~~P Conference Room, Reading Municipal Light Department The meeting convened at 7:00 PM in the Conference Room at RMLD. FINCOM Members Present: Chair Marsie West, Vice Chair David Greenfield, Paula Perry, Hal Torman, Mark Dockser, Bryan Walsh, Barry Berman, Kevin Leyne and Francis Fardy. Members Absent: None. Also Present: John Doherty Superintendent of Schools, Mary DeLai Director UUinance and Operations, School Committee members: Chuck Robinson, Hal Croft, David Michaud, Karen Janowski, Lisa Gibbs, and Chris Caruso, Town Meeting member John Arena, Kara Deyermelajim (Reading Patch) and recording secretary Abby McCabe. There being a quorum the FINCOM meeting was called to order k7:0'8 PM. There b ing a quorum the School Committee was called to order at 7:09 PM. Mr. Doherty gave a brief introduction and summarized tlic fiscal goals for the Reading public schools. Challenges in Developing the FY12 Budget: A total of 28 FTE (full time employees) have` c n lost over the last two years due to budget cuts. The circuit breaker is down from 75% to a 40% reimbursement from the state..The exact amount of the state aid is still unknown at this point in time and an additional $103,000 was'zecently cut as part of the Town Manager's budget before the FINC OM. Substitutqteacher and bus transportation contracts are currently being re-bid. Current challenges facing Reading's schools are large class sizes mainly experienced at the high school, an increase in stu4nts that need additional~support s4p"s cases involving bullying, an increased need for technology support, implementation of the common care and the new anti-bullying laws that will require additional trainings. The priorities and overarching goals are to protect low.class sizes particularly from kindergarten to second grade, sustainingK-12 technology infrastructure; avoiding the elimination of day programs such as art, music, physidal education, foreign languages etc., and maintaining facilities to control the long term operating costs. Ms. DeLai explained that;the circuit breaker is money from the state that reimburses the Townfor high cost special education studenfs.'The circuit breaker funding has been significantly reduced over the last couple of years but. it FY1 l some of the costs were absorbed by the federal stimulus funding. A total of $9115OQQ. is anticipated as the circuit breaker offset for FY12. Ms. DeLai reviewed Cl'apter 70 funding from the last 11 years showing how the funds have decreased since FY09 are the decline is ,expected to continue. A 70% cut to general government aid is included in the Governor's budget. Ms,. DeLai explained that the Chapter 70 formula is calculated by establishing the minimum funding amount necessary to provide adequate public education. On average, Massachusetts communities spend about 16% above this minimum level and Reading typically spends 18% - 20% more than what is required. However, since FY09 Reading and other communities have been spending on average 13% and Reading will be spending 11% in FY 12. In response to decreased state funds, several new fees have been created and existing ones have been increased. Ms. DeLai reviewed a variety of fees since FY09 which included increased athletic user fees, increased bus fee, increased drama fee, and a new band, high school and middle school fees implemented in FYI 1. Over the last three fiscal years Reading has received over $3 million dollars in American Reinvestment and Recovery Act (ARRA) funds. However, despite the fee increases and A A funding, the school budget has still been reduced by $2.7 million over the last two years. Ms. DeLai summarized the personnel cuts from FY 10 and FY 11 and reviewed how much money the school department has returned to Reading's cash reserves from FY09 through FY 11. The School Committee adopted a FY12 budget in January that included a -1.1% reduction from FYI 1. Energy savings from the performance contracting is a major factor in the FYI 2 budget because the performance contracting has been completed in January of this year. Mr. Doherty reviewed the options that were evaluated when determining the final FY12 budget. The first option was a level service budget, the second option was a level funded budget, the third option was the School,C'nmmittee's budget with the -1.1% reduction, and the final budget proposal includes a reduction of the $103,000 from the Town Manager's budget. To get from the School Committee's approved budget to the Town Manager's budget, the School Committee needs to eliminate 2.4 FTE teachers (most likely at the elementary and high school) in addition to eliminating the instructional specialist, raising:.athletic user fees by $40 per student, and eliminating 4.0 FTE Regular Education Para-educators In summary, a total of 36.9 FTEs have been eliminated over the last three years. " Questions: In response to a FINCOM member, Ms. DeLai explained that there are approximately oply.30 non-union employees that will be receiving the I% cost of living adjustment: in efforts to keep strong employees. It was explained that a reference to a "rainy day fund" at a previous $cl col Committee meeting was referring to the state's reserve fund. A FINCOM member asked if revenues could be sumrrnurir6d in the proposed budget. Ms. DeLai responded that this was shown in-the detailed budget book providt.J to FINCOM and mostly comes from the Town's general fund. The Town is still projecting a ,10% cut to Chapter 70 funds,and are assuming that it may not be 10% but believe it will be between 4 % and 10% The school deparlnenl has been following gas prioes"closely and believes the proposed budget is realistic. The five ye4r'contract option is on the Annual Town Meeting warrant which is expected to bring in more competitiveBIDs. A FINCOM m~inber asked if substitute teacher models from other communities or a permanent substitute option was considered in the FY12budget. Ms. DeLai responded that this has been considered but does not save money. Pet xi'anent subs.; can be more expensive rather than a cost savings. Ms. DeLai also clarified that the maintenance reduction in the Town Facilities budget was the courier position and not a custodial position. On a motion by Mr. Dockser, seconded by Mr. Berman, FINCOM voted 9-0-0 to adiourn at 8:22 PM. Respectfully submitted, Recording Secretary 2 qty OFR~-QO Finance Committee Meeting h a March 23, 2011 Conference Room, Reading Municipal Light Co Department The meeting convened at 7:00 PM in the Conference Room at RMLD. FINCOM Members Present: Chair Marsie West, Vice Chair David Greenfield, Hal Torman, Mark Dockser, Bryan Walsh, Kevin Leyne and Paula Perry. Members Absent: Francis Fardy and Barry Berman. Also Present: Town Manager Peter Hechenbleikner, Assistant Town Manager!F nance Director Bob LeLacheur, Town Accountant Gail LaPointe, John Doherty Superintendent of Schools, Human Resources Administrator (Schools) Elizabeth Conway, Chuck Robinson (School Committee), Human Resources Administrator Carol Roberts, DPW Director Jeff Zager, DPW Business Administrator Jane Kinsella, Board of Selectmen Camille Anthony and Ben Tafoya, Town Engineer George Zambouras, Water Treatment Plant Supervisor Peter Tassi, DPW Cemetery Supervisor Bob Keating, Recreation Administrator John Feudo, Town Meeting member John Arena, Kara Deyermenjian (Reading Patch) and recording~secretary Abby McCabe. There being a quorum the FINCOM meeting was called to order at 7:05 PM Benefits: The Town Accountant, Ms. LaPointe, presented a few common myths rel it: d to, retirement and elaborated on each. Ms. LaPointe explained that only the municipal employees who v\, urk more than 1,690 hours per year are in the retirement system. State law requires.sthat recently-hired municipal employees must contribute 9% of their pay into the retirement system and additional 2%o for employees earning over $30,000. Mr.. LeLacheur pointed out that this pelceiztage has mcrea'sed-over time and is likely to go up in the future because the current rate was set in 1996.'Municipal employees in the retirement system do not also receive social security according to Massachusetts law, unless they, qualified from other employment. An employee hired today will very likely contribute en o L i to the pension =fund to pay for the pension received -the ongoing pension issues arc because the 1 u4vn was not required to fully fund projected retirement costs for nearly fifty years, Ms. LaPointe' reviewed the avenge pay received,by Reading retirees. The average Town of Reading retirement,--pension paid was $22,224 in 2009: The majority of Reading retirement system retirees (41%) received between $12,000 - $30;000:, 38% percent receive less than $12,000 and the largest pay between $50,000 - $85,000 only accounts for14% of retirees. Reading retirees are not living on "easy street" as is commonly believed: These figures do not include teachers because they are part of the Massachusetts Teachers Retirement System To;;;ve eligible for retirement you must be older than 55 with a minimum of 10 years of service or be any...., age with a minimum of 20 years of service. However, the benefits are based on a combination of your age and- service. The Town Accountant also reviewed the system costs for active members and the savings accumulated for active members and retirees. Ms. Conway explained the eligibility criteria for the Massachusetts Teachers Retirement System. The four criteria are the position, certification, contract and status. The contract for the position must specifically state that the employee is in Mass Teachers Retirement system. State law defines teachers to also include school social worker, adjustment counselor, psychologist, principal or assistant principal, superintendent or assistant superintendent. The retirement benefits are based on age on retirement date, years of creditable serve, and average of your highest 3 consecutive years salary. Ms. LaPointe reviewed other post employment benefits (OPEB) and recent retirement system reforms and proposed changes. Ms. Roberts reviewed the health insurance benefit - by state law it must be offered to employees, spouses and their family as well as retirees - as long as a minimum of 1,040 hours worked per year (less for school employees). Reading pays 71% of the premium costs, and the employees and retirees pay 29%. The Town share is a low relative to other MA communities. A survey by the Stoneham Board of Selectmen found that Reading's percentage of the budget for health insurance is actually below average at 10% while the average is 12.6% and some communities are much higher (20% of Peabody's budget). If Reading were paying 12.6% out - that would be an additional $1.9 million per year. The State Group Insurance Commission (GIC) does not necessarily save money. Reading recently researched all options and.found that a new "GIS-like" program offered the cheapest option for Reading and in the first year the Town fags spent $600,000 less in premiums than had been budgeted. Ms. Roberts further detailed the app licable stat&laws (Mass General Law Chapter 32B). Employees are eligible for life insurance policies and disabili ty insurance is available only to some MTA but not for Town employees. Dental insurance is available but the Town doesn't contribute to the premiums. Public Works: Two major changes are seen in the FY12 Public Works budget. One seasonal parks and forestry., position is eliminated and one FTE engineer position is'shifted from the general fund'into the Storm Water enterprise fund, As a result of eliminating the seasonal parks position the town will:i eed to adopt a carry-in carry-out policy at the public parks. The shifting of the engineer position into the Storm Water Enterprise fund is necessary because phase I of the NPDES (National Pollutant Discharge. Elimination System) is very time consuming and more support is needed to me6 A,--e requirements of phase-11. The snow and ice budget is also increased in the FYI 2 budget. Professional development-is decreased in the DPW administration budget. Funding for snow and ice was discussed by the Committee. A FINCOM member asked if development of the Addison Wesley site would add to the Town's expenses and the Toivn Manager responded that no Town expenses are associated with this an .the Town has negotiated pay' nig1ts towards sewer and water. Enterprise Funds: The storm water enterprise`Wd was set up to conduct storm .water activities and federal regulations continue to bring new expenses to the Town. A new street sweeper' ixay be added to the FYI 1 budget as opposed to the FY12 budget because it is available now at a better pr`"ice but this will require a budget amendment by Town Meeting. TheToyvn "currently has_one street sweeper and rents'another. Two major Storm Water capital improve : ments,are planned (the Saugus River and Aberjona Rivers). The $40 annual charge for a single familyhome is realistic for this budget but may change once the work the large- scale river drainage work has started: Debt & Capital: Road construction is a ptioiity and the West Street reconstruction has been moved to the FYI 3 budget. There are no significant changes,izt the FYI 2 Town's debt services but this will change beginning in FYI3 because of the new cemetery garage'and the DPW cold storage building. The library renovation is estimated to be $12 million with a $7 million contribution from the Town - but that is proposed as debt-exclusion, so it will not need to be funded by the general fund under Prop 2-1/2. Mr. LeLacheur informed the FINCOM that the Town also just learned of an additional 3 students enrolled at the Minuteman vocational school when the budget had only assumed one student. The Town may also receive rebursement for the two blizzards which would go into free cash. Monday's and Wednesday's FINCOM meetings will start at 7:00 PM at RMLD on Monday and at Town Hall on Wednesday. The Committee will be voting on the budget on Monday and the Warrant articles on 2 Wednesday. If FINCOM has any different suggestions for next week's budget meetings please send them to Mr. LeLacheur in advance so he can prepare material in advance. Mr. Arena asked if the FY 13 forecasts would be available for Town Meeting members and a couple FINCOM members felt this would be important as well. On a motion by Mr. Walsh, seconded by Mr. Dockser. FINCOM voted 7-0-0 to adjourn at 9:55 PM. Respectfully submitted, Recording Secretary 3