HomeMy WebLinkAbout2007-01-10 Finance Committee Minutes
January 10, 2007
Financial Forum
The meeting was convened at 7:40 p.m. at the Senior Center, 49 Pleasant Street, Reading, Massachusetts.
Present were Chairman Andrew Grimes, Vice Chairman Charles Robinson, FINCOM Members David
Greenfield, George Hines, Harold Torman and Michele Williams, Peter Hechenbleikner (Town Manager),
Bob LeLacheur (Asst. Town Manager), Gail LaPointe (Accountant), Board of Selectmen Ben Tafoya
(Chairman), James Bonazoli (Vice Chairman), Camille Anthony and Richard Schubert, Pat Schettini
(School Superintendent), Mary DeLai (School Finance & HR Director), Elaine Webb (School Committee
Chairperson), Lisa Gibbs (School Committee Vice Chairperson), School Committee Members Chris
Caruso and David Michaud, Greg Burns (Fire Chief), James Cormier (Police Chief), Ted McIntire (DPW
Director), Jane Kinsella (DPW Bus. Admin.), Karyn Storti (Library Trustee), Victoria Yablonsky (Library
Trustee), Mary Heinold, Andrew Scribner (RPD), Karen Callan (Barrows), Joseph Finigan (RMHS),
Christine Parks (Budget Parent –Barrows), Kristen Eagleston (Budget Parent-Killam), Paula Perry (Budget
Parent-Coolidge), Karen Powers (Budget Parent-Killam), Michelle Hopkinson (Budget Parent-Joshua
Eaton), Paul Guerrette (Killam), Douglas Lyons (Parker), Craig Martin (Coolidge), John Doherty (School
Dept.)
Andrew Grimes welcomed everyone and went over the Agenda.
Bob LeLacheur showed and described an overview of FY08 Budget Process Goals
Budget Calendar
Budget to Town Manager 1/31/07
Budget to FINCOM 2/14/07
FINCOM budget review Feb 21 – March 21
FY08 Budget Sections
Revenue
Gail LaPointe reviews the changes of the aggressive approach by using a 10 year trend.
Tax Levy without debt exclusion for an average of +4.9%.
Local fees & misc. and State Aid +5%.
FY08 Net Available Revenue (NAR) is $65,092,096. Total NAR is up $1.59 million or 2.5% increase.
The additional revenue to work with is to pay for Accommated Cost and Operating Budget.
The FINCOM Reserves Policy for FY08 is 5% of $65 million NAR, or $3.25 million. Free cash is
$613,700 in excess of 5% target. Gail LaPoint reminds everyone that Free Cash isn’t going to grow as
in the past.
Accommodated Costs
Bob LeLacheur explains how the accommodated costs are to help take some of the pressure off the
operating budgets. These costs are considered outside of the operating budgets:
Shared costs ( e.g. benefits, capital, debt)
Uncontrollable costs (e.g. energy, snow & ice)
Community Priorities (e.g. new additions or changes)
and that FINCOM free cash mechanism will handle any revenue variances.
FY08 Accommodated Costs are $23,331,885. Total is up $1.1 million, or 5%. Capital Budget is
$870,000. A lengthy discussion on the Debt & Capital Policy ensued. Chuck Robinson offered to
reduce the 5% policy for one year as a phase-in to assist the operating budgets. Camille Anthony and
January 10, 2007
Financial Forum
(continued)
George Hines suggested the new 5% policy should be adhered to. In their years of service to the
community, this budget was perhaps uncomfortable but by no means the most difficult one. The
consensus of FINCOM was to adhere to the 5% policy from here forward.
Operating Budgets
Bob LeLacheur explained the Operating Budgets increase for FY08 is $742,352 & two reasonable
possible allocation methods of these funds. The difference in these two methods was not substantial –
about $62,000. He suggested splitting the difference between the methods.
Allocation Methods:
Historical costs – add the available operating budget funds to previous FY07 operating budgets.
Allocate based upon most recent actual operating budget splits (FY06 data).
Baseline Budget – reduce from Baseline Budget, based upon most recent actual operating budget
splits (FY06 data).
Requested budget – reduce from Requested budget as above. This method should not be
considered.
A lengthy discussion of the methods ensued. Elaine Webb stated that she was in favor of whatever
method gave the schools more funding. George Hines suggested that rewarding higher baseline
expenses did not benefit the entire budget process, and while he favored allocating funds according to
the historical method, a compromise was reasonable.
Andrew Grimes moved that the FINCOM set the Operating budgets for the school, municipal and
buildings departments based upon a 50% split of the first two methods described above, seconded by
Robinson. FINCOM voted 5-1-0 (David Greenfield opposes) to support the motion.
George Hines moved to adjourn at 9:55pm, seconded by Grimes, and unanimously approved 6-0-0.
Respectfully submitted,
Secretary