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Home My WebLink About1994-05-25 Finance Committee Minutes Finance Committee Meeting May 25, 1994 LZ} S The meeting convened at 7:30 p.m. at the Reading Senior Center. The following committee members were present: the Finance Committee: Chairman Richard Coco; Vice Chairman Fred Van Magness; Members Jim Keigley, Gerry MacDonald, Steve Blewitt, Bill Murphy, Carol Grimm and Liz Greene. Selectmen: Chairman George Hines, Dan Ensminger, Sally Hoyt and Bill Burditt. School Committee: Chairman Robin D'Antona; Members Matt Cummings, George Shannon, Tom Stohlman, Susan Cavicchi and Tim Twoomey. Superintendent of Schools Dr. Robert Munnelly; Assistant Superintendent of Schools Dennis Richards. School Building Committee: Chairman Russ Graham and member Roger Sanstad. Capital Improvement Advisory Sub-Committee: members Lee Selzer, George Thompson and Victor Petri. The architect working on the Parker Middle School Project David Finney; Parker Principal Jack Delaney; Finance Director Beth Klepeis; Town Manager Peter Hechenbleikner; Kathy Vaccaro from the Chronicle and mown., 5,� r 3;, Chairman Richard Coco of the Finance Committee called the meeting to order at 7:35 p.m. by welcoming everyone from each committee and explained that the intent for this meeting was to review the Parker Middle School Capital Project. Russ Graham, Chairman of the School Building Committee called his committee to order and briefly reviewed the status of Parkers' needs. Enrollments for the school is definitely expanding and major renovations are needed. The town can be reimbursed 66% of the total project cost from the SBAB (School Building Assistance Bureau) if it is new construction. The estimated cost of this project is $13,066,740. With the assumption of a 4% increase for construction costs it could increase to $13.6 million in 1995. George Hines, Chairman of the Selectmen called the meeting to order, with the absence of Camille Anthony. Robin D'Antona, Chairman of the School Committee called the meeting to toe order with everyone present. LFinance Committee Meeting May 25, 1994 Page #2 Jim Keigley of the Capital Improvement Advisory Sub-Committee called the meeting to order. The architect for the project David Finney, explained in detail the process of constructing a new building on the existing site. At the present time Parker and Coolige Middle Schools have 836 pupils, but by the year 1997 and 1998 it will increase to 976 and by the years1998 and 1999 it may be as high as 1020. Aside from the substantial increase in pupils the existing building (Parker) is in need of several repairs. The state however, has made it clear that they would not fund this project if it was renovated, so the Building Committee explored new construction and has found it to be at the town's best interest to pursue this idea. The question arose as to what to do with the pupils while the construction was in progress and they have proposed a 2 year construction plan which i will enable half of the school available to house the pupils with the basic necessities. The Capital Improvement Plan states that the Parker Middle School construction is set to begin in July of 1997 and should be completed in the year 1999. If the project goes as planned there will be a $900,000 shortfall over a 5 year period. But at this time there is a need to house the expansion of students and repairs need to be made, therefore the School Committe and School Building Committee would like to go to Fall Town Meeting with this proposal and begin the project in July of 1995. With this idea the town could be looking at a $2.3 million shortfall over a 3 year period. The Town Manager stated that the Capital Plan in not set in stone and under no scenario is this an easy project to do under capital planning. David Finney stated that if we started with raw land, the town would have a luxurious school for the estimated price of $13,066,740, but there is demolition, clearing and disposing of materials that could cost as much as $700,000. Finance Committee Meeting May 25, 1994 Page #3 David Finney explained that the SBAB regulations are due to expire in June 1995 and if there are changes they would probably be a reduction with the state reimbursements. Currently they are discussing that the 66% reimbursement for interest costs may be (educed to 55% reimbursement on only half of the interest. In order to be guaranteed the current reimbursement rate the project needs full approval from Town Meeting and completed architectural designs for the SBAB deadline of June 1 , 1995. Steve Blewitt questioned, "How do these costs relate to other towns that are building schools?" The reponse was, "we are doing less than what a typical town is spending for schools. Fred Van Magness asked, "How are we going to handle this project from financial standpoint?" The Town Manager referred to several possibilites; proceeds from two pending real estate sales, unused tax levy valued at $500,000 and a debt exclusion overide. The Town Manager presented three scenarios for the Parker Project: Scenario A is consistent with the Capital Improvement Program with first expenses authorized in spring of 1996. Scenario B acquires design funding in Fall of 1994 from any of the above possibilities. Scenario C would require Town Meeting approval of the project at the Fall 1994 Town Meeting, and proceed with design, SBAB approval and construction. Russ Graham suggested to present this to Fall Town Meeting and begin the project in July of 1995, with a 2 year construction completion time. Bill Murphy stated that he thought that he understood that the first $1 million of real estate sales was to go to the Capital Improvement Program and anything beyond that would go toward the pension liability fund. Richard Coco suggested scaling down the project to a lesser amount of $11 .5 million. Finance Committee Meeting May 25, 1995 Page #4 Russ Graham responded to Richard Coco's suggestion, "we can cut back the project and get a middle school that will be good for 5 years; or we can spend $13.6 million and get a school good for 50 years." Jim Keigley stated "we can't afford to mortgage the future of our children and unless we can control our expenditures we will." Gerry MacDonald questioned, "In 20 years will we be looking to close these schools due to the fact that they are too large?" J� I Ck--� 11111,�, Dr. Munnelly stated, "with the closing of Pearl Street School it has saved us operating costs. The long range plan shows an increase in pupils and the portables will be utilized at the schools for a long time. Bill Brown suggested that one source of revenue that has been taken away from us was the RAT (Racing Action Ticket) and asked people to contact our local representatives to urge then to give it back to our community. "It might not pay for our schools but it will help," explained Bill Brown. Bill Murphy explained if we have another overide for the purpose of funding the Parker Project with the reimbursement from the SBAB, it would cost an average of an additional $100 - $200 annually per household over a ten year period. George Shannon stated that if this isn't done it will be educationally devestating for the children. The reason that houses sell in this town is the school system and if you do not invest in it, it will damage the system further. Matt Cummings suggested to the present committee members not to prejudge what the community will want, go tell the community what the requirements are and have them make the decision because the cost will lie with the homeowner. Bill Burditt stated, "If we didn't believe in the community we wouldn't be here and we should work together as a joint group for this project." Finance Committee Meeting May 25, 1994 Page #5 Robin D'Antona said, "the purpose of this meeting is informational there won't be any decisions made here tonight, we are coming together as a town to deal with this complex issue." There were suggestions to create a tasc force to obtain further information for this project and to explore all possibilities. Fred Van Magness also suggested that this group meet once a month between now and Fall Town Meeting. "The purpose of this meeting was to get an update with this project financially and it was achieved. We need to wait to find our about real estate sales and where we are when the books close at then end of FY94 for the levy limit," stated the Town Manager. Tom Stohlman suggested to take every opportunity to meet and have everything ready to come up with a solution by September. The Town Manager will make the Chairman of each committee aware of the next scheduled meeting to discuss this project. On motion by Fred Van Magness seconded by Jim Keigley the Finance Committee voted to adjom the meeting at 10:00 p.m. The several other committee's also to adjorn at 10:00 p.m. Respectfully submitted, isa Za4 Secretary