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Home My WebLink About2022-09-21 Finance Committee Packet - Financial Forum I - REVISED Town of Reading Meeting Posting with Agenda 2018-07-16LAG Board -Committee -Commission -Council: Finance Committee Date: 2022-09-21Time: 7:00PM Building: School - Memorial HighLocation: School Library Address: 62 Oakland RoadAgenda: Revised Purpose:Financial Forum I 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 Saturdays, Sundays and Legal Holid 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 reasonablyanticipates will be discussed at the meeting must be on the agenda. All Meeting Postings must be submitted in typed format; handwritten notices will notbe accepted. Topics of Discussion: This meeting will be held in-person at the RMHS Library, and remotely via Zoom, and will be streamed live on RCTV. Join Zoom Meeting https://readingpsma.zoom.us/j/83657021146 Meeting ID:836 5702 1146 One tap mobile +16469313860,,83657021146# US +13017158592,,83657021146# US (Washington DC) Dial by your location +1 646 931 3860 US +1 301 715 8592 US (Washington DC) +1 309 205 3325 US +1 312 626 6799 US (Chicago) +1 646 558 8656 US (New York) +1 346 248 7799 US (Houston) +1 386 347 5053 US +1 564 217 2000 US +1 669 444 9171 US +1 669 900 9128 US (San Jose) +1 719 359 4580 US +1 253 215 8782 US (Tacoma) Meeting ID: 836 5702 1146 Find your local number: https://readingpsma.zoom.us/u/kbPSIbo58Y FINANCIAL FORUM I AGENDA: ƚƦźĭtƩĻƭĻƓƷĻƩ Sean Cronin, Senior Deputy Commissioner of Municipal Finance Presentation followed by Q&A Local Services (DOR) This Agenda has been prepared in advance and represents a listing of topics that the chair reasonably anticipates will be discussed at the meeting. However the agenda does not necessarily include all matters which may be taken up at this meeting. 1 Page | 1 Town of Reading Meeting Posting with Agenda Killam School PresentationSchool Department Discussion on Purchasing Property for a Senior CenterTown Manager Fidel Maltez Town Finance Overview including projection of Free Cash, Town Accountant Sharon Angstrom Revenue Projection and Budget Preview School Superintendent Tom Milaschewski & School Finance Overview for FY2024 Finance Director of Schools Susan Bottan Future Meeting Agendas Approval of Minutes: August 17, 2022 *REVISED 9/20/2022 updated Zoomlink This Agenda has been prepared in advance and represents a listing of topics that the chair reasonably anticipates will be discussed at the meeting. However the agenda does not necessarily include all matters which may be taken up at this meeting. 2 Page | 2 3 4 5 6 7 8 9 10 11 12 13 Billions 14 Millions 15 16 Millions 17 18 19 FY22 FY21 FY20 FY19 FY18 FY17 FY16 FY15 FY14 FY13 FY12 FY11 FY10 FY09 FY08 FY07 FY06 FY05 FY04 FY03 FY02 Billions 20 Billions 21 22 FY22 (YTD) FY21 FY20 FY19 FY18 FY17 FY16 FY15 FY14 FY13 FY12 FY11 FY10 FY09 FY08 FY07 FY06 FY05 FY04 Millions 23 24 Billions 25 26 27 28 29 30 31 32 33 Millions 34 35 42 43 44 45 46 47 48 49 50 51 52 Sharon Angstrom – –FINCOM Chair Edward Ross Edward Ross – – Sharon Angstrom agenda items? – September 21, 2022 Sharon Angstrom Financial Forum Agenda Financial Updates Revenue Update –Free Cash Update –Sharon Angstrom FY24+ Accommodated Costs FY24+ Operating Budgets under Free Cash Scenarios Discussion about Free Cash Usage in FY24 Budgets FINCOM meeting on October –Approve Minutes FINCOM Closing Remarks FINCOM Opening Remarks 53 +3.4%+9.5%+2.5%+2.6% $ 0.82 $84.52$ .88$ 2.69 $87.3 mil.-$ 8.5 mil. $15.5 mil. $ 4.3 mil.TBD FY24 Revenues Baseline levyNew GrowthExcluded debtAbate/Exempt Property TaxesOther Local Rev.State AidOtherFree Cash 54 2.69 TBD .9% FY24 3.7% 112.88115.56115.57 2.733.03 FY23 4.0%3.5% 111.47 114.50 108.74 2.793.40 24 Revenues FY22 3.3%4.5% -110.63 104.44107.23 Projected FY22 Revenues ($ millions)excluded debt impact Free Cash usedRevenues + Free Cash 55 $19,693,000$16,804,000 ($ 275,000)($ 2,200,000)($ 414,000)$ 1,718,224*$ 200,000$ 18.72 million September 2022 – Reserves ~16.2% of est. $115.6mil. FY24 projected revenueFINCOM 7% Minimum Reserves Policy Free Cash 6/30/22 (est.)Nov 22 TM Article 4 (proposed)Nov 22 TM Article 7 (proposed)Nov 22 TM Article 18 (proposed)Free Cash RemainingGeneral Stabilization FundFINCOM Reserves TOTAL 56 +$418k+$226k+$156k+$152k+$112k+$100k+$414k+$331k+$319k+$249k+$112k . /FEMA FY22 Revenues Reimb time payments + $1.44 million - Property TaxesBuilding & Electrical InspectionsMeals TaxesPenalties & Interest on TaxesMotor Vehicle Excise taxesInvestment Income*Smart Growth Incentive*Local Assistance/Other State Rev.*Delinquent taxes *Medicaid *Miscellaneous<$100k each mostly sustainable + $1.16 million *one Total $2.6 million over estimates 57 $1.08 mill.$.20mill.$1.20 mill. $788k $ 76k$339k $193k - $707k $201k$150k$ 25k$ 10k -- -----+ FY22 Expenditures (PS, PW, & Pub Safety vacancies) Street Lighting Employee BenefitsCapital ExpensesFINCOM ReservesSchool AdminSchool Regular DayTown SalariesTown Salaries (All Other Departments)Various Town Expense Accounts Total $2.48 million under budget 58 .55 2.612.483.67 - $17.73$19.70 FY22(est.) 1.2 (millions) - 1.693.032.95 - FY21 $14.79$17.73 .93.59 - 2.944.13 - FY20 $15.64$14.79 1.0.56 -- 2.993.20 FY19 $11.01 $15.64 .42 - 2.222.541.90 - $8.57 FY18 $11.01 5 Year Free Cash Analysis Certified Beg. Bal. at 7/1Revenue over budgetExpenses under budgetUse of Free CashOther Adj. to Free Cash Certified Bal at 6/30 59 .3% 4.5%3.6%1.8%4.0%2.3% 16.1%26.1% - Change 7.5622.1801.1326.0351.1413.589 21.674 43.465 FY25 4.5%1.6%2.9%1.8%4.0%4.0%2.3% 3.9% Change 9.0152.1051.1125.8030.9053.508 20.733 43.331 FY24 8.8692.0451.0925.5800.8703.430 19.836 41.722 FY23 (millions) 25 Accommodated Costs - Voke - Energy Benefits Financial SPED OOD - Capital & Debt Education Misc & Comm Prior Education Accommodated Costs Projected FY23 60 6.5%0.0%2.5%6.3%4.0%2.4%3.7% 4.5% Change 6.5620.4050.0851.0900.140 0.500012.892 21.674 FY25 6.5%0.0%2.6%6.7%4.0%2.5%3.8% 4.5% Change 6.1620.5000.3950.0801.0650.135 12.397 25 Benefits 20.733 - FY24 5.7860.5000.3850.0751.0400.130 11.920 19.835 FY23 (millions) OPEB Retirement Worker Comp Health/Life Ins. Unemployment Police/Fire Indem Medicare/Soc Sec Projected FY23 Benefits 61 7.5%2.3% 52.4% - 16.11% - Change 3.0753.5441.279 7.562 FY25 0.9%6.8%1.7% -- 1.6% Change 2.8603.4652.686 9.015 FY24 25 Capital + Debt - 2.8863.2462.733 8.870 FY23 (millions) Capital Excluded Debt Debt inside levy Projected FY23 Capital/Debt 62 2.25%2.50%2.75%3.00%3.25%3.50%4.00%4.25% 3.75% Budgets Operating FY24 2.202.382.562.752.923.103.453.64 3.28 ($mil) Usage Free Cash * Similar to FY23 levels FY24 Free Cash Usage note that about ~$700k is directed at ‘extra’ capital 63 Financial Forum IRecommendations/Guidance for FY24 BudgetVote Items for November Town MeetingFinancial Forum IIRegular Meeting (if needed)Attend Select BoardAttend School CommitteeFINCOM: School budgetFINCOM: Town budgetsFINCOM: Vote Budgets & TM Articles Charter: School Committee Budget to Town ManagerCharter: Balanced TM Budget to FINCOM FINCOM Meetings Edward Ross, FINCOM Chair FY24 Budget Public Meetings September 21October 19October 26November 2Dec 6, 7, 14 & 15January 5, 12, 19 & 26February 22March 1March 8 & 15 January 31February 28 {ĻƦƷĻƒĬĻƩ ЋЊͲ ЋЉЋЋ year - that employs a multi that are accountable and measurable that align with the Strategic Plan "´£¦¤³ '® «² "´£¦¤³ $¤µ¤«®¯¬¤³ 0±®¢¤²² "´£¦¤³ /¡©¤¢³¨µ¤² ArticulatingDefining Mapping a vision Our approach to developing a responsive and responsible FY24 budget includes: to optimize resources. ngs Reflect our commitment to building a sense of belonging for all students Add precision to staffing schedules, structures, ratios, and student groupihave proven to produce gains in student learning relative to their cost.Continue the pathway toward universal free Full Day Kindergarten and The FY24 Budget will: . and their voices reflected in decisions made. iven, collaborative, transparent, and based on dr - engaged ontractual obligations and federal/state mandates will be met. Resources will be examined, outcomes analyze, and investments made that performance while yielding future cost savingsCDecisions will be datastrategies and programs with proven results.Stakeholders will be How the FY24 Budget will reach our goals: 3¤¯³¤¬¡¤± £ /¢³®¡¤±FY24 Discuss Priorities and Resource Allocations with District Leadership TeamsFY 24 Budget Questions & Responses Following Cost Center Presentations TOWN OF READING FINANCE COMMITTEE MEETING SCHEDULE - FY23 ЋЉЋЋ Setpmeber 21stFinancial Forum IRHMS Library7:00 PM Vote on Recommendations/Guidance for FY24 Budget October 19th7:00 PM Vote on Warrant Articles for November Subsequent Town Meeting October 26thFinancial Forum IIRMHS Library7:00 PM November 2ndFINCOM: Regular Meeting (if needed) November 14thSubsequent Town Meeting IRMHS PAC November 17thSubsequent Town Meeting IIRMHS PAC November 21stSubsequent Town Meeting IIIRMHS PAC November 28thSubsequent Town Meeting IVRMHS PAC December 6thTown FY24 Budget Meeting with Select Board December 7thTown FY24 Budget Meeting with Select Board December 13thTown FY24 Budget Meeting with Select Board December 15thSchool FY24 Budget Meeting with School Committee ЋЉЋЌ January 5thSchool FY24 Budget Night 1 January 12thSchool FY24 Budget Night 2 January 19thSchool Public Hearing: FY24 Budget January 26thSchool FY24 Budget Final Vote February 22ndFINCOM: School Budget March 1stFINCOM: Town Budgets March 8thFINCOM: Vote Budgets & TM Articles March 15thFINCOM: Vote Budgets & TM Articles (if needed) April 4thTown Election April 25thAnnual Town Meeting begins June 28thFINCOM: Year-End Meeting 70 Town of Reading Meeting Minutes 2016-09-22 LAG Board -Committee -Commission -Council: Finance Committee Date: 2022-08-17Time: 7:00PM Building: Reading Town Hall Location: Select Board Meeting Room Address: 16 Lowell StreetSession: Open Session Purpose: General BusinessVersion: Draft Attendees:Members -Present: Chair Ed Ross, Vice Chair Jeanne Borawski, Joe Carnahan, Geoffrey Coram (remote), Joe McDonagh, Marianne McLaughlin-Downing, Emily Sisson, Mark Zarrow Members -Not Present: Andrew Mclauchlan Others Present: Town Manager Fidel Maltez, Town Accountant Sharon Angstrom, Jackie McCarthy (remote) Minutes Respectfully Submitted By:Jacquelyn LaVerde Topics of Discussion: This meeting was held in-person in the Select Board Meeting Room of Town Hall, and remotely via Zoom. Chair Ed Ross called the meeting to order at 7:00 pm. Liaison Reports: Geoffrey Coram attended the School Committee meeting. On the Subsequent Town Meeting warrant, the Facilities Director will be asking for $500,000 for the ParkerMiddle School roof replacement, and a $200,000 increase to deal with some glycol recycling at the High School to prevent pipes from freezing, as the cost to pump it out and back in has tripled in price since the pandemic. Marianne Downing noted that the School Committee also reviewed an outline of the new Killam School, which will include moving RISE to Killam, and may increase the size of the building by 30%. Mark Zarrow attendedthe Audit Committee meetingand noted that the auditing firm, Melanson, was happy with the results and complimentary of the Town Accountant. They will pick some areas to look at forthe next audit. Ed Ross also noted that the Audit Committee discussed the AAA bond rating. There are only approximately 30 communities that are AAA bond rated. He gave credit for the rating to the policiesthe Townhasin place and their execution. FY23 meeting schedule: st At the first Financial Forum on September 21, Sean Croninfrom the Department of Revenue Division of Local Standardswill come to talk aboutmunicipal finance and school 71 Page | 1 th building projects. The secondFinancial Forum is scheduled for October 26. Subsequent th Town Meeting begins November 14. Finance Committee votes for the warrant articles will th need to be completed by October 18. Town Manager Fidel Maltez noted that the Select th Board will preview the warrant articles on August 30. Financial articles include: proposed amendments to the Capital Plan, proposed changes to the FY23 budget, and approval of payments of prior years bills, though there are no previous bills currently. The Finance Committee will also be asked to vote and report on the $2.2 million request for the Killam School, and a senior tax break that needs to be reapproved. For the rest of the FY23 meeting schedule, Mr. Ross asked Mr. Maltez to put together a meeting schedule. Communication Policy (Email, Website): Committee members agreed that communications should go to the entire group. Currently, the finance@ci.reading.ma.us email goes to the Town Accountant. Most of the emails to that group are spam or requests for information, and relevant information is forwarded to the Committee. Ms. Borawski suggested that the Chair be added to the distribution list. Committee members also agreed that the personal contact information should be removed from the Liaison Assignment List, and that finance@ci.reading.ma.us should be included as the means of contacting the Committee. Discuss Financial Forum Agenda: st The first Financial Forum is scheduled for September 21. There will be a presentation on municipal finance by Sean Cronin from the Department of Revenue, which is anticipated to aid in the discussion of the second Financial Forum of capital projects and budgets. Because Free Cash will not be certified until the beginning of October, Town Accountant Sharon Angstrom stated that she will provide an estimate at the Financial Forum. The Finance Committee will schedule a meeting after the Financial Forum to discuss and provide guidance. Marianne Downing noted that the Reading ARPA Advisory Committee (RAAC) will provide an update on what ARPA funds have already been allocated, and what has been recommended. Discuss Affordable Housing Trust Fund - from SB 7/19: Town Manager Fidel Maltez provided an overview of the proposed Affordable Housing Trust Fund Committee. Reading adopted its own Affordable Housing Trust Fund prior to the state passing Chapter 44 Section 55. The proposed board would designate what the money in the trust fund would be used for. Town Meeting would have to take three actions: repeal the Reading Trust Fund established in 2001, adopt M.G.L. Chapter 44 Section 55 to allow the Town to adopt the new Trust Fund, then create the bylaw. The proposed board will be comprised of five people with two- year terms, one member to be a Select Board member, and the other four members should have experience with housing and development. The governing body would be the Select Board. There would be financial implications, such as an audit once a year, and articles may go before Town Meeting that would be sponsored by the Finance Committee. FINCOM members agreed it would be beneficial for a Finance Committee member to be one of the other four members. Review Preliminary FY2024 Capital Plan: Town Accountant Sharon Angstrom reviewed the Capital Plan. She noted some minor changes in the FY24 plan, which is currently at 5.5%, including an additional $590,000. At November Town Meeting, there will be a request to move $100,000 for replacement firearms for the Police Department up to FY23 using current year savings. Existing firearms will be sold and should yield a decent price, as they are needed for parts. 72 Page | 2 In the FY24 plan, borrowing is anticipatedfor $500,000 for 10 years for the Parker MS roof, $2 million 20 years for the water tower, $1 million for 10 years for sustainability. Ms. Angstrom noted that she tries to adjust projects as best she can to keep the amount to 5%, but currently FY25 is projected at 5.37%. Review FY2024 Budget Process: Ms. Angstrom provided an overview of the budget process to date. She has reviewed the accommodated costs, such as benefits, and looked at the actual expenditures compared with Previous Town Manager Bob LeLacheurs projections, and found Mr. LeLacheurs projections to be very solid. When building a budget, there are a lot of unknowns, but FY24 is estimated at a 3% increase. Discuss Current and Expiring Grants: Town Accountant Sharon Angstrom shared the amounts of known grants: FY22: $538,805 FY23: $2,373,806 FY24: $718,388 (Municipal Vulnerability Preparedness grant) Mr. Maltez noted that there is a pending application for $1 million for a senior center feasibility study for FY23. Approve Meeting Minutes: July 27, 2022: On a motion by Jeanne Borawski, and seconded by Joe Carnahan, the Finance th Committee voted 8-0-0 to approve the meeting minutes of July 27, 2022. Roll call vote: Geoffrey Coram Yes, Joe McDonagh Yes, Marianne Downing Yes, Mark Zarrow Yes, Jeanne Borawski Yes, Joe Carnahan Yes, Emily Sisson Yes, Ed Ross Yes. On a motion by Emily Sisson, and seconded by Jeanne Borawski, the Finance Committee voted 8-0-0 to adjourn at 9:12 pm. Roll call vote: Geoffrey Coram Yes, Joe McDonagh Yes, Marianne Downing Yes, Mark Zarrow Yes, Jeanne Borawski Yes, Joe Carnahan Yes, Emily Sisson Yes, Ed Ross Yes. 73 Page | 3