HomeMy WebLinkAbout1995-02-22 Finance Committee Minutes {, Finance Committee Meeting
February 22, 1995 Ii'uR I'' tr 4v ++�� J5
The Finance Committee met at 7 :00 p.m. in the Selectmen ' s
Meeting Room at Town Hall . Present were Chairman Richard
Coco, FinCom members Gerry MacDonald, Jim Keigley, Nate
White, Carol Grimm, Jerry Vitale, Bill Murphy, and Secretary
Maureen Vierra. Town Manager Peter Hechenbleikner attended
the first 45 minutes of the meeting. Also present was
Superintendent of Schools Dr. Robert Munnelly, School
Committee Chairman Tim Twoomey, School Committee Members Matt
Cummings, Thomas Stohlman, George Shannon and Reading
residents Bill Brown, Linda Molloy, Randy Gonchar, Al
Hamilton, John Arena, Nancy Benjamin, Ellen Mounteer, Nancy
Radville, Gretchen O 'Halloran, Betsey Coldewey, Robin
Hamilton, Belinda Barbas , Bill Saunders, Rachel Baumgartner,
Peter Brown, Carol Guanno, Mary Sage, Marlene Cohen, Donna
Fallon, Mary Kay Watts, Bernard Horn, Lorraine Horn, Laura
Wilson, Nancy McGinty, Susan Bryant, Robert Spadafora Jr, Joe
Healy, Gina Healy and Daily Times Chronicle reporter Maria
Silvaggi .
Approval of Minutes
On a motion by Keigley seconded by MacDonald the minutes of
February 15, 1995 were approved by a vote of 7/0/0.
kow Liaison Reports
Jerry Vitale reported on the Open Space and Recreation Task
Force. A woman from North Reading spoke to the Task Force
and explained how North Reading has been able to receive
grants to obtain land within their community. Jerry was very
impressed and will gather more specifics and share the
information with FinCom when it becomes available.
Dick Coco met with the Architect Selection Committee last
Thursday. This Committee was formed to review the input from
several architects in regard to renovating the Police
Station. They will have more information by next week.
Town Manager Peter Hechenbleikner presented the FY96
Financial Assets availability figures. This reflects the
Finance Committee ' s financial goals which is also the
Department of Revenue and Moody ' s goal which is 5% of the
Operating Budget currently set at $1 , 800,250.00. In total we
will be approximately $437 , 185 . 00 short if the projections
prove to be actual .
Dick Coco explained the function and role of the Finance
Committee to the attending residents. He explained that the
main role of FinCom is to present to Town Meeting a balanced
budget. Because Reading is mainly a residential town, it
relies heavily on taxes and real estate to fund the budget.
Another factor is proposition 2� which restricts the increase
of tax revenue to no more than 2'd% of previous year ' s
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assessment. The 1996 Revenue Projection is $35,845, 842 .00 of
which $17 ,574,946 has been allocated to the schools. The
balance of the money is needed to fund Capital Costs and Debt
Services totaling $2 ,400,000.00, Employee Benefits at
$5 ,000,000.00, which are both fixed costs , leaving
$11 ,000,000.00 to pay for the Municipal side. The School
Committee has requested $630,000.00 more than the Town
Manager has budget them. He asked that the School Committee
trim their budget so it will come closer to where the real
money level is. He explained that by approving the requested
$18 ,207,000.00 money would need to be cut from the Municipal
budget. The Selectmen have submitted a School Budget that
lives within the range available. FinCom will ultimately
submit a balanced budget recommendation to Town Meeting where
it will be voted and approved or amended.
School Department Budget Review
Dick Coco opened the floor for questions.
Dr. Robert Munnelly expressed his disappointment that FinCom
had already decided on a dollar figure in advance of
listening to the School Department' s needs. He hopes FinCom
will take into consideration all of their requests.
Bill Murphy asked if the School Department had seen the
Municipal budget and if they thought they could identify
where a cut could be made in that budget to be given to the
School Department. Nate White pointed out that if FinCom
approved the $18 , 207,000.00 School Committee request, the
Municipal budget would be cut 2'k % which is $245,000.00 less
than their 1995 budget.
Tim Twoomey said the budget prepared represents a budget that
keeps the School Department at status quo and reflects the
increase in the school population and the need to move
forward as the law mandates to keep the high school ' s
accreditation current. Tim feels the budget is a relatively
modest request and would like to know what level of support
the Town is willing to provide.
Resident Al Hamilton said he does not want to hire architects
to look over the Police Station renovation nor does he want
his tax dollars to go toward a new Fire Truck or Fire
Station. He feels the School Department is heading toward
mediocrity and would prefer we spend the money to hire more
teachers .
Ellen Montier asked who in the town was responsible for
looking for new sources of revenue. Dick Coco explained the
School and the Town look for their own grants.
Resident Bernie Horn said he thinks Reading is lacking
leadership. He believes that proposition 212 was a good idea
in the 1980 ' s however believes we should try to get an
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override to increase funds . He also thinks the valuation of
some of the properties in Reading are grossly undervalued.
If these values were raised than the Town would receive
additional revenue. He asked the Finance Committee if they
were prepared to take a leadership role and recommend a 2k
override. Dick Coco explained that FinCom does not play that
role and it would be up to either the School Committee or the
Selectmen to make that recommendation.
Tim Twoomey asked FinCom why they will not give the School
Committee the $600,000.00 from the free cash fund. He
realizes the money in free cash is for a rainy day and he
feels this is the rainy day.
Dick Coco reminded him that Moody looks at the amount of
money set aside in the free cash fund when deciding the
interest rate on which we will have to pay on bonds. By
keeping the free cash fund dollar amount at a 5% figure, the
Town will benefit by receiving lower rates on future bonds .
Carol Grimm pointed out that State aid is down by
$1 ,000 ,000.00 since 1989 . She recommended that we go to
State Representative Brad Jones and see if he can help us get
more funds before going to the citizens asking for a 2g
override. She pointed out that 75% of the voters do not have
children is the school system right now.
One resident mentioned that the parents volunteer their time
and money doing fund raisers for the schools . She feels if
the parents had to they could raise the money to help with
the budget but thinks it would be unfair. It is her opinion
that it is the Town ' s responsibility to fund the school
system.
Dr. Munnelly explained that the budget submitted had been
carefully calculated and they did not just pull numbers out
of the air. Since the budget was submitted in December,
Carol Grimm asked Dr. Munnelly if there would be any
modifications to the submitted budget. He responded that the
only modifications would be upward.
Bill Murphy asked what the financial impact was for the Metco
program. Because Metco is a funded program, financially it
is a wash because of the aid we receive. Matt Cummings
pointed out that if we were to remove the Metco program from
the school system the net impact would be that the town would
loose $107 ,000.00 because of fixed costs that are covered by
Metco.
Nate asked what impact 90 new students would have on the
School Department. It depends on the age distribution of the
new students. If the distribution was even (one student per
class) there would not be any impact. Additional students
are mostly in the elementary level .
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�. Dick Coco asked Dr. Munnelly for details on the break down of
the 162% requested increase in the Administration Cost. Dr.
Munnelly recommended an executive session to discuss the
details of salaries. The School Committee has set aside
$461 ,000 .00 for collective bargaining. This makes up the
largest increase in this section. Carol Grimm pointed out
that there is already a set aside amount in the budget. Matt
Cummings pointed out that there is also a new item of
$58,500.00 which represents the first payment to the state
for the Early Retirement program. This was not in the FY95
budget which is driving the percentage up.
Support Services was reduced by 3% due to the renegotiation
of the bussing contract and reducing the number of
kindergarten runs, a new Health Clerk whose starting salary
is less that the previous employee' s, and some extra
curricular activities were reduced.
Utility projections went up because of the additional space
to be heated and an increase in fuel because of the change
over from heating oil to gas .
An additional custodian will be added to the Elementary
School and to the High School . The new Electricians salary
is included in the budget on page 70. Building Maintenance
went up by $62 ,000.00 and has been broken out by basic
building expenditures and the rest was prioritized . Priority
items include things like cafeteria tables and chairs at
Parker.
Student enrollment is expected to rise in 1996 and the budget
includes solving pent up needs that have not been addressed
for a while. They are anticipating a plateau in student
registration around the year 2000.
Dr. Munnelly reported that State aid for schools is back to
the figure granted in 1989 and that we need to ask our State
Representative if there is a formula that would work better
for us. The formula includes per family income and Reading
residents are among the top 20% which may be hurting us.
The School Department has added a new position to the budget.
They are looking to hire a person to oversee the new
technology that are hoping will be approved as part of the
Capital Plan budget.
Due to the State reform laws, teachers are required to be
re-certified every 5 years. The reform law mandates that
there be a 3% expenditure for Professional Development,
however the School Department is not compelled to spend at
that rate. If the School Department does spend below that
rate however, the Superintendent must explain the short fall
kow to the State Commissioner. We are expecting a reimbursement
from the state for this expenditure. Tuition reimbursement
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falls under the Professional Development. Because the
figures are spread throughout the budget, Dick Coco requested
that all of the Professional development funds be added
together and that the School Committee presents one figure.
Jim Keigley reminded everyone how much we need additional
revenue. He told everyone that if we want to continue
spending at the rate we are spending we need additional
revenue. He supports a 2' override and expects one in 1998 .
On a Motion by Keigley seconded by MacDonald the meeting
adjourned at 10: 15 p.m.
The next Finance Committee meeting is scheduled for February
27, 1995 in the Conference Room at Town Hall at 7:00 p.m.
The Finance Committee will review the Public Safety budget.
The next meeting of the School Department Budget review is
scheduled for March 1 , 1995 in the Town Hall Conference Room.
Respectfully submitted,
1� 6 � 1-t11
Maureen Vierra
Secretary