HomeMy WebLinkAbout2006-02-08 Finance Committee Minutes
FINCOM Meeting
February 8, 2006
The meeting convened at 7:30pm in the Town Hall Berger Room, 16 Lowell Street, Reading
Massachusetts. Present were Chairman Chuck Robinson, Vice Chair Andrew Grimes, FINCOM
members Ron Powell, Marsie West, George Hines, Hal Torman, Michele Williams and David
Greenfield. Also present were Town Accountant Gail LaPointe and Assistant Town
Manager/Finance Director Bob LeLacheur. FINCOM member Paul Bolger arrived at 7:40pm,
and Town Manager Peter Hechenbleikner arrived at 7:50pm.
On a motion by Torman, seconded by Grimes, the minutes of October 19, 2005 were
approved by a vote of 7-0-1.
On a motion by Williams, seconded by Hines, the minutes of November 11, 2005 were
approved by a vote of 5-0-3.
On a motion by Hines, seconded by West, the minutes of December 7, 2005 were approved
by a vote of 6-0-2.
On a motion by Grimes, seconded by Torman, a Reserve Fund transfer in the amount of
$13,000 was approved for account 01-045-5853 (wide area network wiring for Parker MS
and the West Side Fire Station) by a vote of 8-0-0.
At 7:45pm, Chairman Robinson appointed Greenfield as the FINCOM liaison to the ad hoc
committee on the Rubbish Contract.
Bob LeLacheur reviewed the budget schedule for FINCOM for the next several weeks.
George Hines questioned the perceived urgency of the installation of a permanent projector in the
Selectmen’s room. Town Manager Peter Hechenbleikner pointed out the significant portion of
financing contributed by RCTV.
On a motion by Grimes, seconded by Powell, a Reserve Fund transfer in the amount of
$4,500 was approved for account 01-012 (projector in Selectman’s meeting room) by a vote
of 9-0-0.
Town Accountant Gail LaPointe reviewed the FY07 Revenue forecast for the Town of Reading.
She discussed the MSBA reimbursement status, highlighting the change to the middle school
payments as their audits are now complete.
Chuck Robinson asked if we should be concerned about carrying too much cash/reserves in light
of the new formulas proposed by the Governor for Chapter 70 calculations. Peter Hechenbleikner
thought that $5 million was an appropriate number. The new Chapter 70 formula uses 50%
assessed values in a community, and 50% of the wealth of the community (each divided by the
number of public school students).
Gail LaPointe reviewed a handout about the reserves situation in the Town. As a side note, the
DEP has not yet released the full amount from the Sale of Real Estate of the former landfill. Peter
Hechenbleikner expects this to be done before the annual Town Meeting (in late April). If this
process is delayed, some FY07 capital items will be delayed until a subsequent Town Meeting.
George Hines mentioned that we should not tax to the full levy limit in light of the additional
revenues from State Aid.
Bob LeLacheur reviewed a debt handout that described the committed debt service both inside
and outside the tax levy. He pointed out that in a few years the debt burden on the operating
budget would begin to decline significantly. Peter Hechenbleikner noted that this would allow for
an increase in capital spending. The FINCOM had adopted a 6.5% total debt plus capital policy in
the past. At over 11% in FY07, this 6.5% floor is not an issue in the FY07 budget.
Bob LeLacheur reviewed the Town budget, pointing out the ‘One Year percent change’ column
and the additional text description – both items FINCOM had requested last summer. He also
pointed out the green columns as level service (no additions) and the blue columns as requests if
additional funds were available. The original total of these additional requests were $320,000;
however the Board of Selectmen selected $144,594 of those items to include formally on the
FY07 budget list.
Chuck Robinson compared this $145k of additional Town requests with $345k of District
Improvements from the Superintendent’s Recommended FY07 budget from December 2005. He
mentioned that the FINCOM would prefer to have comparable budgets from both the Town and
School. One way would be to compare these budgets including the above ~$490k of additional
requests. However, the FINCOM would prefer to compare the smaller budgets. He mentioned
that a level service (no additions) budget has been requested from the School Committee. Andrew
Grimes, Paul Bolger and Hal Torman noted that this would presumably be $345k less than the
budget from the Superintendent. Bob LeLacheur requested that the FINCOM ask the
Superintendent to confirm this.
Bob LeLacheur proceeded to review every Town department budget, including the approved
Selectmen’s additional request items. FINCOM suggested that a list of questions for the Town
and School departments ahead of their scheduled meetings would be a valuable process that has
worked well in the past. FINCOM would begin to compile a list, and forward it one week before
the associated meeting date.
Bob LeLacheur discussed the methods of allocating additional revenue (or cutting costs) beyond
a level service budget. One way is to view the School-Buildings-Town budgets in their prior
year’s proportion (roughly 60-10-30). The other is to exclude the Buildings Maintenance budget –
viewing it as more of a fixed cost. The remaining allocation of previous years’ budgets was close
to a 66-33% (School-Town) split. By acclamation, FINCOM strongly favored this latter
approach.
Chuck Robinson mentioned that he would contact the Superintendent about getting a level service
budget that would be comparable to the Town’s budget in time for the Financial Forum next
week.
On a motion by Torman, seconded by West, the meeting of February 8, 2006 adjourned at
10:00pm by a vote of 9-0-0.
Respectfully submitted,
Secretary