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HomeMy WebLinkAbout2016-06-07 Board of Selectmen Minutes - Community Listening OF 1J V. Town of Reading 'r b' Meeting Minutes /IF$,IRCOR?0Pr Board - Committee - Commission - Council: mss: Board of Selectmen Date: 2016-06-07 Time: 1:00 PM Building: Pleasant Street Senior Center Location: Great Room Address: 49 Pleasant Street Session: Open Session Purpose: Community Listening Session Version: Attendees: Members - Present: Chairman John Halsey, Vice Chairman Kevin Sexton, Secretary Barry Berman, John Arena, Daniel Ensminger Members - Not Present: Others Present: Town Manager Bob LeLacheur, Assistant Town Manager Jean Delios Minutes Respectfully Submitted By: Secretary Topics of Discussion: The Town Manager reviewed key dates — and noted that August 16 is last day to decide on a special election/override vote. If Yes: Thursday, September 1 would be the Community Financial Forum at 7PM RMHS Performing Arts Center. Monday, Sept 12 would be a Special Town Meeting — reminder, no formal role for Town Meeting in this process. Tuesday, October 18 would be the Special Election The State primary is a few weeks before the October 18 meeting and the Presidential Election is a few weeks afterward. Due to staffing concerns, best to include a separate election because combining would only save a small amount of money. Resident Carol Shattuck asked about the budget process and the Town Manager stated that they are trying not to be specific about the exact nature of the cuts. She is looking for a budget process and review process. The Town Manager reassured her about the process. Since the last override, annual revenues have risen at 3.1%, we can raise taxes 2.5%. The growth on State Aid is not even 3%, local and other receipts are very low. The forecast for revenue over the next three years - using cash reserves 2.6%, but only 2.1% without using cash reserves. Schools and Town spending is up, capital and debt down nearly 1% and 5% for the shared benefits (see slide presentation). Our retirees and employees took on more costs in order to s preserve jobs. Page 1 1 Board of Selectmen Minutes - June 7, 2016 - Community Listening=page 2 Annual spending has grown at the rate of 3.1% since the last override. The annual forecast for the next three years with free cash is 2.6% total and 2.1% total without free cash. Free Cash reserves won't be certified until September. He discussed 9C cuts from 2009 when we had to make massive midyear cuts, but having that reserve is essential and lessened the impacts of state cuts. Litigation ongoing regarding the high school and it appears the construction funds that the town still has may not be enough to settle the case. Process is protracted but it is before a judge. The Town Manager reviewed the Peer Communities Revenues slide and notes that peers pull in $12M more than the Town in revenue - difference is mostly in commercial revenues. State Aid dropping, 64% increase in health care. "We cannot rely on the state to help us." Peer Residential Tax Burden - Reading is below average, we are about $700 below average. Reading doesn't always appreciate that the taxes are better than in other communities. Per pupil spending in Reading is also very low - student population is high. Reading is a bedroom community with a low commercial tax base. Residential property taxes are below peer averages. The Town is at the point where we cannot reduce the quantity of our services without reducing the quality of the services. The last override was promised to last only a few years. Ways to help seniors age in place: • Accept optional costs of living increases for seniors and surviving spouses - this will only affect a few residents. • Increase the senior exemption from $750- $1000 • Lower the interest rate on those who qualify to defer taxes on their homes from 1- 9%. John Halsey noted that the more important point is the steps we are trying to take. The accelerating value of the home creates an accelerating tax. The intent is to help seniors with increasing taxes. A Home Rule petition would be needed to shift taxes to other taxpayers. In theory, tax rates could be lower for elderly, low-income population. Wants to see this Sudbury option introduced state wide.. Overrides - What do our peers do? Everyone in yellow (on the slide) more recently attempted an override. Looking at the CIP shift, they are able to see that towns with more industry are also earning higher revenues and able to make the shift more meaningful. The Town Manager reminded everyone that he has been warning people for several years of the underlying financial condition. The last override was expected to last 8-10 years, but it has been 13 years. The Town Departments spend $17.2 million on wages and $8.2 million on expenses. The point is that we cannot make necessary cuts - we need to cut $890,000 and there is no way to do it without affecting jobs. Page 1 2 Board of Selectmen Minutes - June 7, 2016 - Community Listening - page 3 "None of us (including the Selectmen) are in favor of an override, we just want what is best for town," said the Town Manager, Kevin Vent, 33 Hillside Road, is Moderator of the meeting. Joe McDermott, 4 Tamarack Road noted he is confused about how an override works. What is it authorizing the Selectmen to do? The Town Manager responded that Under MGL, you can word a ballot question to direct money to certain uses. Under state law for the first year with new money you can push it in a specific section, and following years they can do whatever they want. It will be up to the Selectmen to decide how specific they want to be. For an operating override, you are asking for a specific number. Last time the amount was $6M and that is a permanent increase. It is different from a capital exclusion, a specified purpose. The Town manager.explained the difference between a debt exemption override vs an operating override. A one-time increase in revenues will help that. Selectman Daniel Ensminger explained that an underride vote could happen to make a similar, permanent decrease in taxes as well. The Town Manager added that the Selectmen could vote a tax rate lower than the budgeted amount. Michelle Sanphi noted she is part of the ballot initiative committee. A service she would like to see added would be the ability to retain and attract high quality employees to both town and school positions. She supports the term 'Age-In-Place,' and wants to see support for police and fire. The reputation of our schools attracts a lot of people. We would like to see an end to reduced level service. Jack Devir, Tamarack Road, asked re: Lawsuit - what are the costs of litigation? Town Manager would not release figures. Harry Wheeler - Fixing roads... Main Street, and West Street... those projects are mostly state projects. Also regarding Town Employees - does the town have its own health insurance, and would we save money with GIC? The Town Manager responded that our health insurance is through MIIA which is a collaboration of 100 communities that get together for health insurance. We have good collective bargaining power. All the unions collectively bargaining - it is a great collaborative issue. Employee contributions are about $1M lower. One community said they would save $2M moving to GIC, but it really cost them $200K. We're always looking for new opportunities. Under ObamaCare, they don't have all the financial `tools' (ie, mechanisms to lower rates for subscribers) anymore, no one knows how to price health insurance right now. In Reading it is about 10% of the budget. It is up to 20% in some towns. A resident from 355 South Street, asked how many new positions were created since that last override? Don't these expenses have to go before the Finance Committee and what was their take on some of these things? Resident said that if given a choice of a service to cut it would be trash collection. "There are places where we can cut, you're going to step on someone's toes no matter where you tread." The Town Manager responded that employment has been flat over the last 13 years. Thirty years ago DPW had 10 employees, now it has about 45. Our balance on FTE is close to zero percent change. He then explained the budget process. He sends the budget to the Finance Committee in March, then they vote on it and it becomes the Finance Committee's budget, then they bring it to Town Meeting. Page 1 3 Board of Selectmen Minutes - June 7 2016 - Community Listening - page 4 John Doherty responded that he believes any increase in staffing is related to special education. They used some out-of-district tuition money so that they can support better programming for students. Richard Holmes asked who decides whether we use cash reserves or not. The Town Manager responded that during the budget process, they get guidance from the Finance Committee about how much cash from free cash. Using free cash to balance your budget is a really bad idea. Building operating budgets on one-time revenue - we know this cannot continue. Daniel Ensminger explained drop off in free cash amount projections (from slide). There is a drop off, he describes some of the revenue and noted it doesn't make assumptions on litigation. Carol Shattuck asked how costs for the schools are forecasted. Superintendent John Doherty noted that enrollment is pretty static, but they also offer a full day Kindergarten and they charge over $4,000 for the costs. Enrollment has stayed fairly consistent at 0-1% increase each year. Special education programming has gone up. Carol Shattuck validated the concerns of John Doherty and the Town Manager that Reading is still a bedroom community, seniors are staying, because nowhere else to go, rents are high in other places. She says, if we need a school (capital exclusion) we need to talk about it in this time frame. Joan Kochal asked when debt exclusions come off the books. The Town Manager responded that the RMHS and Library will be paid off in about 10 years. If there is an operational override it will be with us forever. Sally Hoyt, 221 West Street, long term Reading resident, noted that the seniors in Reading like the services the Town provides. She said they have proved to her that they have thought about how to help seniors. She is also asking for an exemption for seniors not to have to pay more. Her family has lived here for five generations. Thank you very much and you've done a great job. The Town Manager responded that we may come to a conclusion about what to do with property taxes, but state law is rigid about what we can do to customize tax rates. We only have 43 businesses that would qualify because of the way the State allows us to do things. Christine Hansen raised the issue of fee structures and asked how Reading compares. The Town Manager responded that we found that +/- we were above or below 5% with other peers in terms of fees. It is a service to the residents. State law that says a fee has to be appropriate for the service a provided. We are trying to offer a service. Richard Coco indicated he wants to see the leaf dump opened every day of the week. Target fees instead of taxes: make the dog license really expensive. Been in Reading 45 years, and claims it has gone from a fiscally responsible community to now a tax and spend town. He expressed incredulity that the community cannot live on a $100M budget. Every family has a budget, if you can can't afford something you don't do it. We need police, fire, Veterans, DPW (he thinks too many people) and beyond that we decide what to keep and what to eliminate. John Halsey noted that $300,000 is the budget for the Pleasant Street center. Schools are two thirds of the budget. We don't want to eliminate police and fire. Richard Coco noted he could not see why this town cannot run on $100,000,000. Page 1 4 Board of Selectmen Minutes - June 7 2016 - Community Listening -page 5 Carol Shattuck noted "Nothing is sacred." She requested a budget review, "so that we know you have done everything before asking for an override." John Halsey noted that no one is trying to sell a yes or a no. The whole point of these sessions is just this - when all is said and done, if everyone understands the situation, we have a ballot box, if you decide that there is going to be an override, we can work with that, and if there is not going to be an override we will work with the Town Manager's office to live within what we have. All of us decide at the ballot box and you've elected us to work with that and administer what you want us to do. A Resident asked about the Finance Committee approved lighting for the fields: Feels that the lighting project for Birch Meadow complex is too expensive, asks if the project can be scaled back. The Town Manager responded that there is a process to go through. We have gone out for bids and he doesn't know what will happen. The Recreation Committee raised fees that will help cover the debt services. It was a one-time use of money made very careful about the expenditure... We don't buy the cadillacs. Another resident said that currently the tax rate is the same for residents and CIP. "Commercial property is making money here in Reading and we are not." The Town Manager noted that bedroom communities tend not to shift. "For every dollar you raise to the business, you split that dollar 8 ways... Last fall it was a 3-2 vote on the BOS." Daniel Ensminger noted that everyone likes to focus on Jordan's and Home Depot... but CIP includes every business, so we have to be mindful about how the shift affects businesses... small businesses are more affected than large businesses. Kevin Sexton noted that a lot of people have the misunderstanding that if we did split the rate we'd gain more. He again explains that while residents may pay less, we can still only collect the same amount of money and still need an override in order to expand the budget. John Parsons asked why we don't buy and rehab a better senior center... Senior population will increase. The Town Manager asked what are new things we should want? What are other communities doing and what do you have... and until we get our house in order we really can't think about things like that. Assistant Town Manager Jean Delios noted she's the one that wants the $16M senior center. We don't have it now, and won't have it for a while. It doesn't cost anything to take a look and perhaps plan for it. We are working on a master plan for human and elder services. What will Reading look like in 5-10 years is what we should be thinking about. Barry Berman suggested that as you make decisions about what is important in town, in 20 years the senior population will be growing, and also know that kids in school now will have jobs not yet invented. His wealth is in his house and what is going to support him is the value of his home. People are coming to Reading because they want to live in a town that supports the kinds of services offered. Even if you don't have a kid in school, the schools matter. His role on the BOS is to take care of everyone. To take care of one population at the expense of another pits one side of the community against the other side of the community. Then you lose, regardless of the outcome. We are thinking about it in terms of what is good for the whole town. Page 1 5 Board of Selectmen Minutes - June 7 2016 - Community Listening - page 6 A resident noted that affordability is a big part of it because we are all on fixed incomes. Barry Berman noted that the board is looking at some of these tools to help. Look at what you are getting vs the cost, and is what you're getting worth the cost? Look at it as an entire community. A resident noted that electric rates are rising 5-7%. We have to be as frugal as we can be, the debate is whether he will be able to afford his home, and he doesn't want to have to leave his home. He notes that some seniors are living hand to mouth. Jim Martin, Charles Street noted that there were two debt exclusions for the library. One was $10M and another $3M and those votes raised our taxes twice. A gentleman noted that the 'Yes for Reading' group is putting pressure on Selectmen. The Town Manager responded that if 'YES for Reading' is funding something in town, unions do not have more power in this process... Hasn't seen any evidence of "YES for Reading" putting pressure on voters. Michelle Sanphy mentioned that lots of families have kids in college and they are living paycheck to paycheck. Regarding fiscal responsibility she wants to know the impacts across employee groups. Town Manager responded: In FY2016 the School made 7.3 FTE cut without touching special education though. The Town eliminated 7 positions, most were part time. Positions with Firefighters, and Police could be cut - otherwise cutting specialized jobs... and want to keep good service. We have tried all kinds of different models and we know what fails. We are now at the point that we cannot afford to play any games at all, we will have to stop doing some things if we don't get more money. Amy Cole noted that we are only as good as the care we give our most vulnerable including our seniors and children. She thinks prop 2.5 is 30 years old and it doesn't keep up with the regular increases in the budget. Create new revenue to keep the services that we have. I think we do a great job with what we have. I'm concerned there are things that we haven't done. Elementary schools are old... but it is something we are dealing with. Town employees and teachers are underpaid... Prop 2.5 pits groups of people against each other. She is also in favor of the CIP split. Richard Coco asked if we would add the school into your budget? Wants to see the costs of the School Department in the slide presentation. An advocate to the Selectmen noted there should be two tax rates. $500 is better in his pocket than anyone else. He doesn't get pension increases, but working people are getting increases. Kevin Vendt noted he is 47 years old and hasn't seen a raise in nine years. He is in the prime of his earning career... people who are working are facing the same things. We have to look and solve these problems together. A 60 year resident said the forefathers of this town didn't think ahead, they didn't want businesses here. They didn't even want McDonald's. We are on a limited income, we don't get raises, I know people are struggling. Do you want to keep us in our homes? John Halsey referenced that the Lynnfield Market Place was another lost opportunity very recently. Linda Snow Dockser, School Committee member noted that this kind of forum is why her family moved to Reading and she invites the public to ask questions and comment on the questions being put forth. On You Tube one can see the Selectmen Meetings and the School Page 1 6 Board of Selectmen Minutes - June 7 2016 - Community ListenincLpage 7 Committee meetings, and great questions were asked here. There are some answers out there. The answers aren't done yet. The meeting was adjourned at 2:50PM. Respectfully submitted, Secretary Page 7