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HomeMy WebLinkAbout2015-10-28 Board of Selectmen Minutes OF F? *Oc Town of Reading r s e Meeting Minutes o _ fio 's39�1NC04QOPC Board - Committee - Commission - Council: Board of Selectmen Date: 2015-10-28 Time: 7:30 PM Building: Pleasant Street Senior Center Location: Great Room Address: 49 Pleasant Street Purpose: Financial Forum Session: Joint Meeting Attendees: Members - Present: Board of Selectmen Chair Daniel Ensminger, Selectmen Kevin Sexton and Barry Berman Members - Not Present: John Halsey and John Arena Others Present: Town Manager Bob LeLacheur, Assistant Town Manager Jean Delios, Police Chief James Cormier, Fire Chief Greg Burns, Town Accountant Sharon Angstrom, Public Services Director John Feudo, DPW Director Jeff Zager, Assistant DPW Director Jane Kinsella, Superintendent of Schools John Doherty, Town Ombudsman Matt Kraunelis, Board of Selectmen Chair Dan Ensminger, Selectmen Kevin Sexton and Barry Berman, Ruth Urell, Vicki Yablonsky, David Traniello, School Committee Members Jeanne Borawski, Gary Nihan, Elaine Webb and Linda Snow Dockser, Eric Burkhart, and Nancy Docktor, Fincom Chair Mark Dockser, Anne Landry, Paula Perry, Paul McNeice, Marc Moll, Vanessa Alvarado and Administrative Assistant Caitlin Saunders Minutes Respectfully Submitted By: Topics of Discussion: Finance Committee Chairman Mark Dockser called the meeting to order. The School Committee was also called to order. Town Accountant Sharon Angstrom gave a review of FY15. She noted we were under budget by $1.6M on the expense side. The Killiam Fields project did not happen which turned back a lot. She noted regeneration has started growing over the past couple years. Ms. Angstrom provided a graph showing free cash for the last 20 years and predicting it for FY16-18 assuming a $2M a year usage. She then showed free cash at the beginning and end of each year with the regenerations from FY03 predicted to FY18. A question was asked which services make the 'charges for services' number so high. Ms. Angstrom noted most of that number is building department fees. The Board of Selectmen called to order at 7:40 PM. Mr. LeLacheur explained the reformatting changes in the presented Budget summary. There is an extra $412,000 in property taxes and $100,000 in transfers for facilities. The Permanent Building Committee is asking to fund a design study in $200,000 for the cemetery building. Page 1 1 Board of Selectmen Minutes — October 28, 2015 — page 2 Assuming 8% for health insurance increases and 2.5 for state aid, it will take $2 Million in free cash in FY17 to balance the budget. We will not know the health insurance number until February and there is a good chance it will be higher than 8%. The FY18-FY20 graph shows we will have to cut about one million every year to balance the budget. The operating budgets cannot continue at 3.5% realistically. There is about $2 Million in unmet needs and $1 Million annual structural deficit. The background for an override is present especially with health insurance increasing the way it has been. The Board of Selectmen had an executive session to talk about a possible large real estate development that could bring in a lot of revenue but probably not for 5-10 years. In Article 3, the FY16 General Fund there is a $2 Million subtraction of debt project from the cemetery garage. Mr. Berman asked how we explain to the community that even though we are growing free cash we still need an override to continue to provide current services. Mr. LeLacheur noted we can only keep solving these problems for a few more years before we won't have any left. We do not want to drain our free cash completely before we ask for more. Mr. LeLacheur provided a graph with similar communities to Reading and their tax rates compares to ours. The services required of Reading are the same as communities like Lexington, Winchester and Andover however those communities' taxes are significantly higher than Readings. Reading is the lowest on the list in commercial space. Mr. LeLacheur said he excluded communities like Burlington who have 30% commercial space that pays 75% of their property tax. Reading has less than 10% commercial space. We have to think about who cannot afford higher taxes, like the elderly, who are a large population in Reading. Ms. Perry asked how the town can keep existing businesses and market to get new --- businesses into town. Mr. LeLacheur noted other towns have staff specifically for that, who go out and look for businesses. However, Reading simply does not have the staff to do that. Mr. Ensminger noted it is time for the Board of Selectmen to seriously start thinking about the future and ask for an override. Realistically it would be for FY18 at this point. Mr. Dockser commented that the boards need to explain to Town Meeting what that means for services. Mr. Berman suggested we really take this year to gather feedback from the community on their priorities and educate them on what the override would be for and how much. Mr. Dockser noted we also need to take into effect the changing demographics. Mr. LeLacheur said he would like to protect employee morale and not show Town Meeting 2 budgets showing employee cuts, we should use generalizations. Dr. Doherty noted 3.5% would be scary for the Schools with cuts. Mr. Berman suggested showing 2 budgets but show 1 of where we are now and 1 of where we want to be. Ms. Barowski commented it is hard to protect employee morale too when someone leaves and we can't fill the position. Mr. LeLacheur said Reading's budget is very detailed compared to other towns. We have a lot of line items and separate out a lot of things to show specific areas. Page 1 2 Board of Selectmen Minutes - October 28 2015 - page 3 Ms. Snow Dockser suggested we show what free cash would look like if we used what we needed to sustain budgets. Mr. LeLacheur noted we could have 2 good years if we ran down free cash but then after that we would be in trouble. Once people are properly informed they will understand and sort out their priorities. It would be a good idea to ask for an override now and see what the community says and then adjust when we know. Ms. Alvarado asked if there are any concerns moving forward with such a large kindergarten size this year. Dr. Doherty answered that is hard to predict because we don't know what the next size class will be. Mr. Dockser asked what 1% would be in dollar amount for health insurance increase and Mr. LeLacheur answered $150,000. Ms. Perry noted she liked FINCOMs approach last year with the health insurance increase and said free cash is meant to take the shortfall that's why we have it. Dr. Doherty wanted to point out that the schools have reached their foundation for Chapter 70 aide and not expect that to increase too much. FINCOM agreed $2 Million was a good number for Mr. LeLacheur and the Board of Selectmen to work with for free cash and use 8% for health insurance. Mr. Dockser said his personal opinion is we should be careful how high we raise OPEB. Mr. LeLacheur noted if we were fully funding OPEB we would need another $1.5 Million per year in the general fund. Ms. Angstrom commented some communities aren't funding OPEB at all. Article 3 amended is an additional $200,000 for a design study for the cemetery building and delete the $2 Million right now for the project. Mr. Sexton made a motion to approve Article 3 as amended, second by Mr. Berman and approved with a 3-0-0 vote. Mr. McNeice asked what to $200,000 design study would get us. Mr. LeLacheur answered they are touring all the cemeteries and gathering data with land options and will come back with a full study and almost give us a package ready to put out to bid. Mr. McNeice asked if this would look at a combo with DPW and Mr. LeLacheur said that is to be determined. Mr. Ensminger said he thinks the committee is very open minded and will look at all options. He also noted one person on the committee has built three other towns' DPW/cemetery buildings. Ms. Perry asked if there was money in capital for this project. Mr. LeLacheur noted there is $3 Million currently in capital in FY18 for DPW and cemetery buildings. Page 1 3 Board of Selectmen Minutes - October 28, 2015 -page 4 Mr. McNeice made a motion to accept Article 3 as amended, second by Mr. Moll and approved with a 6-0-0 vote. r Mr. Sexton made a motion to accept Article 4 as proposed, second by Mr. Berman and approved with a 3-0-0 vote. Ms. Perry made a motion to accept Article 4 as proposed, second by Ms. Alvarado and approved with a 6-0-0 vote. Mr. Sexton made a motion to accept Article 5, second by Mr. Berman and approved with a 3-0-0 vote. Mr. McNeice made a motion to accept Article 5 as amended, second by Mr. Moll and approved with a 6-0-0 vote. Mr. Berman made a motion to adiourn at 8:55 PM, second by Mr. Sexton and approved with a 3-0-0 vote. Mr. McNeice made a motion to accept the minutes from October 14th, 2015 as amended, second by Mr. Moll and approved with a 5-0-1 vote with Ms. Perry abstaining. Mr. Moll made a motion to accept the minutes from September 16th, 2015 as amended, second by Ms. Alvarado and approved with a 6-0-0 vote. Ms. Landry made a motion to adiourn at 9:05 PM, second by Mr. McNeice and _approved with a 6-0-0 vote. RespectfullySubgajtted Secretary r Page 1 4