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HomeMy WebLinkAbout2021-11-04 Finance Committee Packet 2018-07-16 LAG Board - Committee - Commission - Council: Finance Committee Date: 2021-11-04 Time: 7:00 PM Building: Reading Town Hall Location: Conference Room Address: 16 Lowell Street Agenda: Purpose: General Business Meeting Called By: Jacquelyn LaVerde on behalf of Chair Ed Ross Notices and agendas are to be posted 48 hours in advance of the meetings excluding operation and make necessary arrangements to be sure your posting is made in an adequate amount of time. A listing of topics that the chair reasonably anticipates will be discussed at the meeting must be on the agenda. All Meeting Postings must be submitted in typed format; handwritten notices will not be accepted. Topics of Discussion: This meeting will be held in-person in the Town Hall Conference Room and remotely via Zoom. Join Zoom Meeting https://us06web.zoom.us/j/82889553484 Meeting ID: 828 8955 3484 One tap mobile +16465189805,,82889553484# US (New York) +16465588656,,82889553484# US (New York) Dial by your location +1 646 518 9805 US (New York) +1 646 558 8656 US (New York) Meeting ID: 828 8955 3484 Find your local number: https://us06web.zoom.us/u/kczcjgrIxn AGENDA: Discuss and re-vote November Town Meeting Article 3 (Water Fund Capital) and Article 4 (FY22 Water Fund expenses) Discuss and vote to establish a FINCOM ARPA Subcommittee Approve Meeting Minutes: Financial Forum October 20, 2021 1 Proposed 2022 Capital Planning FINCOM Subcommittee Proposal Reading, MA Primary Objective Develop a spending plan for excess Free Cash and ARPA funds that reflects the one-time needs, priorities, and values of the community Secondary Objectives Increase community and town meeting engagement in financial planning process Increase ability of boards/committee/commissions to work collaboratively together October 2021 - COMPLETED Fincom Chair reaches out to chairs of Select Board and School Committee for input and conceptual agreement Subcommittee discussed at Financial Forum with full Select Board, School Committee, and FINCOM conceptual agreement November 2021 FINCOM votes to create a 7-person 2022 capital planning subcommittee comprised of the following: (I would advise against Chairs, and simply say 3 or 2 members apiece) Chair Fincom Fincom Member Fincom Member Chair Select Board (or designee) Select Board member Chair School Committee (or designee) School Committee member The following staff will support this subcommittee with their attendance, professional guidance, and advice School Superintendent School Director of Finance Town Manager Town Accountant Town hall staff will provide administrative support (scheduling and posting meetings, taking minutes, etc.) December 2021 January 2022 Fincom determines what amount of free cash can be considered and available for capital projects in the next 12 18 months Select Board and School Committee Chairs suggest two members each to join subcommittee Fincom votes all seven members to the committee 2 February March 2022 Subcommittee determines a high-level project plan (such as example below) Step 1 - Develop discussion making framework (what factors will we use to prioritize projects?) Step 2 Develop plans for broad community outreach Email to Town Meeting Members Updates at Town Meeting Regular reports out to Fincom, Select Board, and School Committee Public Meeting? Survey to Staff? Town Meeting Members? Boards/Committees/Commissions? General Public? Step 3 Brainstorm list of potential upcoming capital and debt projects Step 4 Prioritize list based on decision making framework Step 5 - Subcommittee discusses best use of both ARPA funds and excess free cash; makes joint recommendation to Select Board (ARPA funds) and Town Meeting (excess free cash) Complete Steps 1 and 2 above April 2022 Town Meeting Announce subcommittee composition and objectives Share decision making framework Share proposed plan for TMM and community involvement/engagement Share expectation that Subcommittee will present spending plan for ARPA and excess free cash at November 2022 Town Meeting May June 2022 Solicit broad community input for potential spending projects Create final list of potential uses of funding July September 2022 Subcommittee prioritizes projects based on decision framework October 2022 Share prioritized list with Select Board, School Committee, Fincom invite Town Meeting Members to all meetings Staff begin to develop budgets with these priorities discreet from rest of budget November 2022 Share prioritized list with Town Meeting December 2022 3 Subcommittee and Fincom debriefs lessons learned Fincom dissolves subcommittee Notes from Public Input To Date: Possible decision making framework ideas: Grant requirements understand ARPA requirements and work within them Sustainability - create on-going operating costs unless we can sustain them after grant money is gone or we actively plan to phase them out Investment Mindset Best bang for our buck things that will benefit community long after grant money is gone (i.e. infrastructure) Utilize existing planning - Fund items we would have done anyway, to free up money for future capital projects Strategic spending - delineate between strategic long-term spending and tactical short-term spending; prioritize strategic long-term spending Equity ensure that money is being used to address needs of entire Reading population as broadly as possible; consider traditional 2/3 school-1/3 municipal split Other: Fincom could consider enhanced use of a stabilization fund Subcommittee could consider expanding scope of work to include listing potential future debt exclusions (Killam, Senior Center) and/or operating overrides 4 2016-09-22 LAG Board - Committee - Commission - Council: Finance Committee Date: 2021-10-20 Time: 7:00 PM Building: Reading Public Library Location: Community Room Address: 64 Middlesex Avenue Session: Open Session Purpose: Financial Forum Version: Draft Attendees: Members - Present: Chair Ed Ross, Vice Chair Jeanne Borawski, Eric Burkhart (remote), Geoffrey Coram, Marianne Downing, Jackie McCarthy, Joe McDonagh, Mark Zarrow Members - Not Present: Andrew Mclauchlan Others Present: Town/School Staff: Town Manager Bob LeLacheur, Town Accountant Sharon Angstrom, Facilities Director Joe Huggins (remote), Library Director Amy Lannon (remote), DPW Director Jane Kinsella (remote), School Superintendent Tom Milaschewski (remote), Assistant DPW Director Chris Cole (remote), School Director of Finance Susan Bottan Select Board Members: Chair Karen Herrick, Vice Chair Anne Landry (remote), Carlo Bacci (remote), Chris Haley School Committee Members: Chair Tom Wise, Vice Chair Shawn Brandt (remote), Erin Gaffen (remote), Carla Nazzaro Public: Eileen Sickler (remote), Debbie Hattery, Robert Forsythe, Ian Nelson, Debi Haynes, Dave Ferreria, Rich Abate Minutes Respectfully Submitted By: Jacquelyn LaVerde Topics of Discussion: This meeting was held in-person in the Community Room of the Reading Public Library, and remotely via Zoom. Chair Ed Ross called the meeting to order at 7:03 pm. School Committee Chair Tom Wise called the School Committee to order at 7:03 pm. Introduction of Superintendent Dr. Tom Milaschewski and School Finance Director Susan Bottan Mr. Ross introduced new School Superintendent Tom Milaschewski and new School Director of Finance Susan Bottan, then welcomed them and thanked them for joining the School Department. Public Comment: Bob Forsythe, representing the public safety professionals of Police, Fire, and Dispatch, read a prepared statement that requested American Rescue Plan Act (ARPA) funds to be used for backpay for hours worked by Public Safety employees who had to work in-person during the pandemic, as it qualifies under premium pay for essential workers \[Attachment A\]. Review of FY21 Revenues & Expenses/ 5 Update for FY22 Revenues & Free Cash/ Projected FY23 Revenues/ Projected FY23 Accommodated Costs Town Accountant Sharon Angstrom provided an overview of projected FY23 revenues: property tax increases 3.6% to $84.3 million, other local revenues decrease 1.7% to $7.6 million, state aid increases 2.5% to $15.2 million, other transfers increase 1.6% to $4 million, and the amount of Free Cash to be used is to be determined. FY22 revenues are projected at a 4% increase to $107.81 million, with $2.87 million used from Free Cash for a 4.7% total increase in Revenues plus Free Cash to $110.78 million for the operating budget. FY23 projected revenues increase 3% to $111.12 million, or 0.3% increase to the operating budget without the use of Free Cash, which has not yet been determined for FY23. Current Reserves are $19.64 million, with $17.7 million in Free Cash, which was just recently certified by the Mass. Department of Revenue, $1.7 million in the General Stabilization Fund, and $200,000 in the Finance Committee Reserve Fund. FY21 revenues saw $1.7 million in regeneration, and expenditures came in $3 million under budget. Town Manager Bob LeLacheur reviewed FY21 through FY24 accommodated costs. The Department of Revenue found a glitch in their system that resulted in new growth coming in $400,000 higher then projected, which means new growth currently and for the new budget will be $1.6 million higher. Accommodated costs are up 3.6%. Benefits are up 4%. Other Post Employment Benefits (OPEB) is the most discretionary benefit. It was reduced to $0 at the start of the pandemic, but is increased to $350,000 for FY23, and $500,000 in FY24. Once the pension is fully funded in 2031, then those savings will be directed toward OPEB obligations. Insurance increase is anticipated at 2% next year. There may be a surplus in insurance with so many open positions, but the projected increase will not be known for certain until the first week of February when MIIA provides a quote. Because a quorum was now present, Select Board Chair Karen Herrick called the Select Board to order at 7:26 pm. Mr. LeLacheur continued with an overview of Capital and Debt with the current debt issued, approved, and requested through FY25. The Capital Plan requests $27.9 million for projects between FY23-FY33, and projected funds are $41.4 million. This results in a projected $13.5 million excess capacity. Though the Capital Plan is usually pretty thorough in the near term, it can be less reliable in years six through ten, as unexpected equipment replacements can arise despite established replacement plans. The figures also do not account for the Birch Meadow Master Plan estimated at $10 million, and the School Athletic fields estimated at $3.1 million. Use of Free Cash to support FY23 budget/ FY23 Operating Budget guidance Mr. LeLacheur presented a chart of Free Cash Usage for FY23 ranging from $1.5 million,or 2.1% of the operating budget, to $3 million, or 4.3% of the operating budget. Free Cash has regenerated an average of approximately $3 million for the past few years. The Committee engaged in a lengthy discussion about School needs including: hiring additional counselors, addressing students increased social/emotional needs, and a Killam space study. The Committee agreed that they were comfortable with using $2.75 million to balance the FY23 operating budget given the high free cash balance and needs in the community. On a motion by Mr. Coram, and seconded by Ms. Borawski, the Finance Committee voted 8-0-0 to recommend using $2.75 million from Free Cash to support the FY23 operating budget. 6 Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-Yes, Marianne Downing Yes, Ed Ross-Yes. Discuss Working Group to Identify Community Needs for ARPA Funds/ Discuss uses of ARPA Funds Mr. Ross and Ms. Borawski presented their plan to establish a working group to assess community priorities using American Rescue Plan Act (ARPA) funds and excess Free Cash. The time frame is driven by the Town Meeting schedule, so that Town Meeting receives regular updates and remains engaged in the process. The proposed members of the working group would be the Chair and Vice Chair of the Finance Committee, the Chair and Vice Chair of the Select Board, the Chair and Vice Chair of the School Committee, the School Superintendent, the School Director of Finance, the Town Manager, and the Town Accountant. The Working group would be charged with working with the community to identify priorities, and to present a plan to Town Meeting in November 2022 on how to spend the ARPA funds and excess Free Cash. Where Chair and Vice Chair can change each year, it would be up to each represented Board/Committee to identify their representatives for this working group. Mr. Haley, Mr. Wise, and Ms. Landry agreed that a seventh member may be beneficial, perhaps a third representative from the Finance Committee, to be a tie-breaking vote if needed. Following discussion, Ms. Angstrom reviewed the acceptable uses of the $7,592,234 awarded in ARPA funds. Discuss/vote any financial articles for October Special Town Meeting/ Discuss/vote any financial articles for November Subsequent Town Meeting: Mr. LeLacheur reviewed the outstanding articles for the October Special Town Meeting: Article 6 for Performance Contracting, Article 7 for the Auburn Street Water Tank replacement, and Article 9 for the acquisition of land adjacent to Meadow Brook Golf Club. He noted that the article for the Wakefield Vocational School for the November Subsequent Town Meeting can be tabled, as two communities did not support the project, though it would be a good opportunity to educate the community. Ms. Borawski asked if ARPA funds could be used for Performance Contracting, to which Ms. Angstrom answered no. Because one of their members had to leave, Mr. Wise called for the adjournment of the School Committee. On a motion by Ms. Nazzaro, and seconded by Mr. Brandt, the School Committee voted 4-0-0 to adjourn at 9:46 pm. Roll call vote: Shawn Brandt-Yes, Erin Gaffen-Yes, Carla Nazzaro-Yes, Tom Wise- Yes. The Finance Committee began with discussion on Article 9 to purchase Meadow Brook land. There are two options presented by the prospective developer: buy all five lots at $2.25 million, or one lot at $450,000. Ms. Downing stated that she felt that $2.25 million is a lot of money for not a lot of land and was opposed to the purchase of all five lots. Mr. Coram stated that the price is not a lot considering there is $17 million in free cash, and felt the Town could purchase the land now, but resell it in the future if it does not find a use for it. Ms. Borawski stated that she was persuaded by the presentation by Conservation Commission Chair Annika Scanlon, and cited her own experience on Strout Avenue and agreed that there is a parking and safety issue and lack of access to Town Forest. However, she noted that she is struggling with the $2.25 million cost, and the impact it may have on future capital projects. Members of the Committee and the Select Board raised additional concerns including: the benefits of preserving more open space, not having a use for the lots, still needing an easement to access Town Forest, potential additional costs such as making the lot ADA compliant, and the Towns role not being to acquire property just to sell it. 7 Following discussion, the Committee voted on both options. For Option A, the purchase of all five lots: On a motion by Ms. Borawski, and seconded by Mr. Coram, the Finance Committee voted 1-7-0 to recommend the purchase of all five lots on Article 9. Motion did not carry. Roll call vote: Eric Burkhart-No, Geoffrey Coram-Yes, Jeanne Borawski-No, Joe McDonagh-No, Jackie McCarthy-No, Mark Zarrow-No, Marianne Downing-No, Ed Ross-No. The Committee discussed their recommendation on how to finance the purchase of all five lots should Town Meeting vote to approve. On a motion by Mr. Zarrow, and seconded by Ms. Borawski, the Finance Committee voted 3-5-0 to recommend authorizing $2.25 million in debt to purchase the five lots. Motion did not carry. Roll call vote: Eric Burkhart-No, Geoffrey Coram-No, Jeanne Borawski-No, Joe McDonagh-No, Jackie McCarthy-No, Mark Zarrow-Yes, Marianne Downing-Yes, Ed Ross-Yes. On a motion by Mr. McDonagh, and seconded by Ms. Borawski, the Finance Committee voted 7-1-0 to authorize $1.5 million in debt and fund the remainder from Free Cash to purchase the five lots. Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-No, Marianne Downing-Yes, Ed Ross-Yes. For Option B, the purchase of just one lot: On a motion by Ms. Borawski, and seconded by Ms. Downing, the Finance Committee voted 8-0-0 to recommend the purchase of just one lot for $450,000. Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-Yes, Marianne Downing-Yes, Ed Ross-Yes. On a motion by Ms. Borawski, and seconded by Mr. Coram, the Finance Committee voted 8-0-0 to recommend funding the purchase of one lot using $450,000 of Free Cash. Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-Yes, Marianne Downing-Yes, Ed Ross-Yes. The Committee previously voted to recommend authorizing debt for the Performance Contracting recommended in Article 6. The Committee still agreed with that recommendation and the article did not need to be re-voted. The energy savings will help pay for the debt, and the Capital Plan is balanced with it being issued as debt. For the Auburn Street Water Tower replacement proposed in Article 7, Mr. Zarrow asked where the $4.5 million already borrowed was, and what else the funds could be used for. Ms. Angstrom explained that the funds are in the Capital Project fund waiting to be used, and Town Meeting would have to reassign the money for use on another project acceptable under the borrowing terms. ARPA funds cannot be used to pay for past debt. The Committee continued to discuss funding the additional $2.5 million needed using ARPA funds, Water Reserve funds, and additional borrowing. Ms. Borawski made a motion to recommend Article 7 to be funded up to $1 million in debt, $500,000 from Water Reserve funds, $1 million from ARPA funds, should the Select Board deem it appropriate, and if not, $1 million in debt. The motion was seconded by Ms. Downing. Following brief discussion about use of ARPA funds, Ms. Borawski withdrew her motion and issued a new one. 8 On a motion by Ms. Borawski, and seconded by Ms. Downing, the Finance Committee voted 7-0-1 to recommend funding the $2.5 million using $500,000 from the Water Reserve Fund, and up to $2 million using ARPA funds as determined appropriate by the Select Board, and any balance to be paid by debt. Roll call vote Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Abstain, Mark Zarrow-Yes, Marianne Downing- Yes, Ed Ross-Yes. On a motion by Mr. Haley, and seconded by Mr. Bacci, the Select Board voted 3-0-0 to adjourn at 10:58 pm, as Ms. Landry had already left the meeting. Roll call vote: Carlo Bacci-Yes, Chris Haley-Yes, Karen Herrick-Yes. Approve Meeting Minutes: September 30, 2021: On a motion by Ms. Borawski, and seconded by Mr. Coram, the Finance Committee voted 6-0-2 to approve the meeting minutes of September 30, 2021, with Mr. Zarrow and Ms. Downing abstaining, as they were not present at the meeting. Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-Abstain, Marianne Downing- Abstain, Ed ross-Yes. On a motion by Ms. Borawski, and seconded by Ms. Downing, the Finance Committee voted 8-0-0 to adjourn at 10:59 pm. Roll call vote: Eric Burkhart-Yes, Geoffrey Coram-Yes, Jeanne Borawski-Yes, Joe McDonagh-Yes, Jackie McCarthy-Yes, Mark Zarrow-Yes, Marianne Downing-Yes, Ed Ross-Yes. 9 Ladies & Gentlemen, good evening. My name is Bob Forsytheand I am here with Dave Ferreria the President of the Reading Firefighters Association, Richard AbatePresidentof the Reading Police Supervisory Association, Ian Nelson President of the Reading Police Patrol Officers Association and Joe Pagnotta President of the Reading Dispatchers Association.We are also joined by a small number of our members. On behalf of the public safety professionals that serve our community I want to thank you for allowing me to read this statement. We are here tonight to speak on a topic that is presently being undertaken by members of town government and influenced by other special interest groups.That issue being the American Rescue Plan Act.The federal law which was designed to infuse Federal Monies, not State or Local tax revenues, back into town as forms of relief and/or compensation due to the Covid-19 pandemic. I would like all of you to think back approximately 19months ago, mid-March of 2020.It was a time of uncertainty as cases were being detected in the greater Boston area. The schools closed, lockdowns began, non-essential employees were put on leave and manyemployees were sent home to work from home.Thank goodness for Zoom! However, as Firefighters, as Police Officers, as 911 Dispatchers, we came to work every day and continued to provide a vital service, one which could not be Zoomed, at the onset of an unknown pandemic, with what protections we could put in place.We were issued masks, gowns, face shields and antiseptic wipes.Our vehicles and workspaces were constantly cleaned, however, at the same time we had no idea how the virus was spread.We had no idea if we were taking it home to our families.We were changing our uniforms in basements and garages.We were taking whatever steps we could to help us feel as safe as possible during these most trying times. We were masking/gloving/gowning up and we were answering calls.We were going into houses known to be COVID positive to transport sick patients to get the care they needed and deserved. In fact, to date we have answered the community's call over 6,300 times. And we were contracting COVID.Multiple members of the police and fire unions, as well as even a pregnant wife, came down with the illness as a result of a first responder working in mostly unknown bio-hazardous conditions. Thankfully the government, on many levels, had protocols and guidelines to protect other workers while not punishing those that were infected.However, these cases continued to put additional stress on us and our families. Again, while others had the opportunity to work from home, we did not. One of the key aspects and intent of the legislation is for direct compensation to be paid to eligible first line responders, the exact individuals we four unions represent.Compensation for hours worked during the most trying times of this pandemic, from its onset to the rollout of the lifesaving vaccines. 10 Under the State and Local Assistance portion of the law, it allows for premium pay for Essential Workers, as designated by local officials.We, as defined by the statue, clearly fall under the umbrella of essential workers.It allows for back pay for hours worked, up to a $13.00 hourly increase for the hours, with a maximum dollar cap, during the many months of the pandemic.We ask that this body first discuss this allocation of the funds and then make the correct decision to compensate the emergencyservice employees of Reading for their past actions. We are asking that the Town of Reading recognizes us for those efforts and provides us with a reasonable relief for the outstanding job done by all Public safety personnel.If this was 19 months ago,I am confident that government leaders would happily vote to do so, using funds thatplace no further burden on the residents of Reading.19months ago, we did our jobs without hesitation, we did not ask for special pay, though it was common talk in the newspapers and social media. In the past 19months,other legislation has been passed to addressareas of relief or compensation for other parts of society, this is the first legislation that addresses the front-line public safety workers and gives the elected officials the opportunity to compensate theirwork.Today, we ask that we be compensated. Compensated by Federal funds that cost this town nothing, for the essential work we performed for over a year for this Town and its residents and visitors. Thank you for your time.We are glad to answer any questions andI look forward to a response from the leaders of this community. 11