HomeMy WebLinkAbout2010-09-15 Finance Committee Minutes
Public LibraryConference Room, Reading
Finance Committee Meeting
Financial Forum
September 15, 2010
The meeting convened at 7:00 PM in the Conference Room of Reading Public Library.
FINCOM members present
: Chair Marsie West, Mark Dockser, Bryan Walsh, Barry Berman, Kevin
Leyne, Francis Fardy and David Greenfield.
Members Absent:
George Hines and Hal Torman.
School Committee Members present:
Chris Caruso, Karen Janowski, Hal Croft, David Michaud,
Chuck Robinson and Jared Beaulieu (School Committee student representative)
Board of Selectmen members present
; James Bonazoli, Rick Schubert, Ben Tafoya, Camille
Anthony, Steve Goldy
Board of Library Trustees present
Vicki Yablonsky, Richard Curtis, Jeff Doucette and Cherrie
Dubois
EDC member
Russ Graham
Town Meeting members
John Arena, Bill Brown and Tom Ryan
Also Present:
Town Manager Peter Heckenbleikner, Town Accountant Gail LaPointe, Assistant Town
Manager/Finance Director Bob LeLacheur, Superintendent of Schools John Doherty, Assistant
Superintendent Patty de Garavilla, Director of Finance and Operations Mary DeLai, Greg Burns (Fire
Chief), Jim Cormier (Police Chief), Ruth Urell (Library Director), Jeff Zager (Public Works Director),
Jane Kinsella (DPW Business Manager), David Mancuso.
Press:
Matt Casey (Reading Patch) and Paul Feeley (Daily Times Chronicle).
There being a quorum the FINCOM Chair called the meeting to order at 7:09 pm. The Chair of the
Selectmen also called the Selectmen’s meeting to order and the Chair of the School Committee called
the meeting to order. The Board of Library Trustees called their meeting to order at 7:30 PM.
Ms. West gave opening remarks and introduced everyone to the first Financial Forum of the budget
year.
Assistant Town Manager & Finance Director Bob LeLacheur reviewed the budget calendar noting that
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there will be three Financial Forums this year (September 15, October 27 and January 27). The
School Committee’s budget meetings are also shown on the meeting handout. Mr. LeLacheur
explained the budget process. Generally, the Financial Forums are held earlier in the year in the fall
and winter while the Finance Committee begins meeting at the end of February or early March to
prepare the budget for Annual Town Meeting in the spring. The Town Manager’s budget is finalized in
February.
Revenues: Current Estimates:
Town Accountant Gail LaPointe reviewed Reading’s reserve funds. Ms. LaPointe explained the
existing reserves held in stabilization funds shown on page 4 of the handout. The Town has several
stabilization funds that includes; a general fund, a smart growth incentive payment fund, employee
buy-back fund, sale of real estate fund and certified “free-cash” fund. A little over $1.5 million is in the
general fund. The smart growth incentive payment fund that holds $700,000 and includes the two
$350,000 payments the Town received from the State for adopting smart growth districts (the gateway
smart growth site and the downtown district). This money was placed in the stabilization fund because
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if construction does not begin with in a certain time period the Town must return the money to the
State. The $1 million sale of real estate fund and almost $4 million in the free cash completes the
reserves summary. Free cash will change as the following discussion will discuss.
Revenues: Historic Regeneration:
Ms. LaPointe reviewed the history of Reading’s revenues (from 2005 to 2010) and how it has varied
from the original projections that budgets were built upon. The amount of money in the
Intergovernmental has the largest variance which includes money from the State and Federal
government. In 2009 and 2010, the Town received significantly less than what was originally
budgeted. The Investment Income was relatively high during 2007 and 2008 because of the High
School construction project but the budgeted interest income for operations excluded this amount,
which was set aside for one-time capital expenditures during these years. Revenues have exceeded the
Town’s projections for the last five years but in 2009 and 2010 there was a shift and the margin of
surplus was very narrow. The surplus becomes free cash at year end.
Expenditures:
Ms. LaPointe reviewed the variances in the 2010 expenditures shown on page 5 of the meeting
handout. When money that is budgeted is not spent it is returned into free cash. For example, the trash
account was lower over the last couple of years than what was budgeted because people tend to
generate less trash during economic recessions. Mr. LeLacheur pointed out that when reviewing the
budget from previous years to keep in mind that it is the final budget and not necessarily what was
approved in the spring because sometimes money is transferred during the year. Money not spent
becomes free cash at year end. Free cash is projected to be about $5 million based on these discussions.
Town Land Overview:
Town Manger Peter Hechenbleikner provided a list and map showing all of the vacant Town own land
in Reading, excluding parks, cemeteries and conservation land. The parcel size and land values are also
included on the handout. Many of the Town’s vacant parcels have limitations such as wetlands. Only a
couple of parcels are opportunities for the Town to sell to generate some revenue. The Oakland Road
and Pearl Street parcels are potential sites. The Town Manager suggested some of the wetlands be
transferred to the Conservation Commission. Selectmen Bonazoli asked how the land values were
calculated and Mr. Hechenbleikner explained that they were the assessed value from the Town’s Board
of Assessor’s. Mr. Brown asked how the Town transfers land and Mr. Hechenbleikner responded that
land transfers are executed by a vote of the Board of Selectmen (for tax title land) unless Town
Meeting approval is required.
Revenues:
Mr. LeLacheur reviewed the Town’s FY10 revenue in the restricted and unrestricted funds. Restricted
funds are funds designated for specific purposes and can only be spent for those purposes. The
restricted funds are shown on page 19 – 21 of the handout. Page 24 of the handout shows recent
revenue and expense savings and efforts from the Town. Savings in expenses includes items such as
sick leave buyback for employees, changes in the health insurance program, the energy performance
contracting, and reduced sick leave. Recent revenue savings include the incentive payments from the
smart growth zoning districts, a review of all Town fees and the local meals tax.
Brainstorming Session:
Mr. Dockser facilitated a brainstorming session where meeting participants provided revenue ideas in
small groups. A letter on revenue ideas (community access sticker fee increase) to the FINCOM from
Reading resident Dave Talbot was distributed. After each group shared their ideas for potential
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revenue sources with the whole group, everyone voted on what was considered to be opportunity areas
where the Town should focus their efforts. The items identified as the top priorities included the sale
of Town owned land, billboards and advertising, renting space for cell towers and wireless
communications, hiring a public relations or economic development officer, and naming rights. Ms.
West described the next steps and explained that the Finance Committee would summarize the results
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of tonight’s meeting. The next financial forum scheduled for October 27 will focus on expenses.
On a motion by Mr. Berman, seconded by Mr. Greenfield, FINCOM voted to adjourn at 9:05
PM by a vote of 7-0-0.
Respectfully submitted,
Recording Secretary
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