HomeMy WebLinkAbout2006-10-18 Finance Committee Minutes
Joint Meeting of Finance Committee,
School Committee and Board of Selectmen
October 18, 2006
The meeting convened at 7:45 p.m. in the Senior Center, 49 Pleasant Street, Reading,
Massachusetts. Present were Finance Committee Chairman Andrew Grimes, Vice Chairman
Chuck Robinson, Finance Committee Members George Hines, David Greenfield, Ron Powell,
Michele Williams and Hal Torman, Board of Selectmen Chairman Ben Tafoya, Vice Chairman
James Bonazoli and Selectman Camille Anthony, School Committee Chairman Elaine Webb,
School Committee Members David Michaud, Carl McFadden, Pete Dahl and Lisa Gibbs. Also
present were Town Manager Peter Hechenbleikner, Assistant Town Manager/Finance Director
Bob LeLacheur, Public Works Director Ted McIntire, Town Accountant Gail LaPointe, Police
Chief Jim Cormier, Superintendent of Schools Pat Schettini, School Director of Human
Resources and Finance Mary DeLai, Assistant Superintendent John Doherty and Paula Schena.
Finance Committee Chairman Andrew Grimes noted that there are changes to the budget
process, the budget calendar and the budget format this year. A section of ‘Accomodated Costs’
is established, consisting of volatile, fixed, and/or shared costs. The usual departmental budget
authority will be retained, but these costs will be analyzed outside of the usual operating budgets.
The Finance Committee is also setting up a policy on capital and cash reserves.
Bob LeLacheur reviewed the budget calendar. He noted that the Subsequent Town Meeting
starts on November 13th, the preliminary staff budgets are due to the Finance Committee on
December 20th, a Financial Forum on January 24th, and the final budgets to the Town Manager
on January 31st.
Bob LeLacheur noted that there will be a cautious approach to revenue. We will use free cash
sparingly in the budget process, lock down revenue estimates as early as possible, and use free
cash to handle variances that arise late in the budget process. The Finance Committee
recommends excluding the earmarked revenues which will leave us with net revenues.
Bob LeLacheur noted that the accommodated costs are costs outside the operating budget such as
shared costs including benefits, capital, etc. Also, uncontrollable costs; i.e., energy, rubbish,
snow and ice. Community priorities would be for new additions to the budget.
Cash reserves are established as 5% of the net available revenue, a minor change from the 5% of
total revenue. Suggestions for use of cash reserves over 5% NAR include leave in reserves, add
capital funding, and add funding for long term liabilities, one time community priorities, and
supplement current/future budgets for a one time item but not necessarily recurring costs.
Carl McFadden asked about capital. Bob LeLacheur noted that the Finance Committee is
looking at 5.25% for capital but has not agreed to it yet. He also noted that capital has to be done
and should not be considered optional.
Joint Meeting of Finance Committee, School Committee and Board of Selectmen – October 18,
2006 – Page 2
Town Accountant Gail LaPointe reviewed the revenues. She noted that a realistic revenue
estimate is to add 2.50% plus any new growth. She also noted that an average of 5% for State
If State Aid doesn’t come in at the rate assumed, then the Finance Committee will handle with
free cash for this year. We would only use free cash one year and then cut the following year.
She noted that a 5% increase in FY08 equals $64,944,392 - that is $1.75 million over last year.
Carl McFadden asked what is the actual % for creating the FY08 Budget. Andrew Grimes
indicated that they need to see a baseline budget. A baseline budget is what we did last year –
standard expense and inflation and the staffing stays at the same staff level as last year, then what
has to be done for exceptions. He noted that the departments should include what they think we
should be doing so the Finance Committee can see what we are missing/giving up.
It was decided that the next Financial Forum will be on January 10, 2007.
A motion by Webb seconded by McFadden to adjourn the School Committee Joint Meeting
of October 18, 2006 at 9:30 p.m. was approved by a vote of 5-0-0.
A motion by Anthony seconded by Bonazoli to adjourn the Board of Selectmen Joint
Meeting of October 18, 2006 at 9:30 p.m. was approved by a vote of 3-0-0.
The Finance Committee continued their meeting.
The Town Manager noted that a Reserved Fund Transfer is needed for storage of the Election
equipment. We are currently using Pods and that is very expensive. The transfer is for the
amount of $8,300 to purchase a trailer to store the Election equipment at the DPW Garage.
A motion by Grimes seconded by Williams to approve the Reserve Fund Transfer in the
amount of $8,300 for the purchase of a trailer to store Election equipment was approved by
a vote of 7-0-0.
Bob LeLacheur reviewed Article 4 of the Subsequent Town Meeting Warrant. George Hines
indicated that he felt the Classification Study and the shade trees should wait until the next
budget.
Torman moved and Greenfield seconded to recommend the transfers under Article 4 as
presented. Hines moved and Williams seconded to amend the motion by deleting C13 in
the amount of $20,000 and revise F12 to $3000. The motion to amend failed by a vote of
3-4-0 and the main motion failed by a vote of 4-3-0.
A motion by Williams seconded by Torman to adjourn the meeting of October 18, 2006 at
10:15 p.m. was approved by a vote of 7-0-0.
Respectfully submitted,
Secretary