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Home My WebLink About2020-10-21 Finance Committee Financial Forum Packet Town of Reading Financial Forum October 21, 2020 Financial Forum Agenda October 21, 2020 FINCOM Opening Remarks Chair Edward Ross Financial Updates Revenue Update Sharon Angstrom FY22+ Accommodated Costs Bob LeLacheur FY22+ Operating Budgets under Free Cash Scenarios Bob LeLacheur Discussion about Free Cash Usage in FY22 Budgets FINCOM th FINCOM meeting on November 4agenda items? Approve Minutes FINCOM Closing Remarks Edward Ross FY22 Revenues Property Taxes$80.7 mil.+3.4% Baseline levy$77.88 New Growth$ 0.80 Excluded debt$ 2.79 Abate/Exempt-$ 0.77 Other Local Rev.$ 7.7 mil. +6.6% State Aid$14.4 mil. 0% Other$ 4.0 mil.-1.1% Free CashTBD FY21 State Aid Budget Update Governor Baker re-filed a state Budget for this Fiscal year. The Baker-Polito Administration held to their committed to no less then the FY20 level of funding for Chapter 70 and UGGA. The FY21 funding commitment also includes Ch. 70 increases for inflation and enrollment. Circuit Breaker at 70% -$145,000 in SPED costs for Reading in FY22 Local Aid TypeOriginal Updated Additional FY21 FY21 State Revenue ProjectionAidProjected School Aid Ch. 70$10,325,000$10,834,809$509,809 UGGA$2,826,500$3,442,525$616,025 Projected FY20-22 Revenues FY20FY21FY22 Revenues ($ millions) 98.88 100.90104.00 excluded debt impact 2.902.852.79 101.78103.75106.78 1.9%3.0% Free Cash used 1.00 2.08TBD Revenues + Free Cash 102.78105.83106.80 3.0%0.9% Projected FY21-22 AccomCosts FY21FY22ChangeFY23Change Accommodated Costs 39.09939.9412.2%41.4853.9% .ĻƓĻŅźƷƭ ЊБ͵ЍЊАЊВ͵ЋБВЍ͵АіЋЉ͵ЌАЏЎ͵Џі /ğƦźƷğƌ ε 5ĻĬƷ А͵ЋВВА͵ВЎАВ͵ЉіА͵ВБЊЉ͵Ќі 9ƓĻƩŭǤ Ћ͵ЉЉЉЋ͵ЉЊЎЉ͵БіЋ͵ЊЋЉЎ͵Ћі CźƓğƓĭźğƌ Њ͵ЉЌЉЉ͵ВЋЎΏЊЉ͵ЋіЉ͵ВЍЋЊ͵Бі 9ķǒĭğƷźƚƓ Ώ{t95 hh5 Ў͵ЌЋЎЎ͵ЍЍЏЋ͵ЌіЎ͵АЊВЎ͵Љі 9ķǒĭğƷźƚƓΏƚƉĻ Љ͵ЎЎЉЉ͵ЏЊЉЊЉ͵ВіЉ͵ЏЌЍЌ͵Ві aźƭĭ ε /ƚƒƒ tƩźƚƩ Ѝ͵ЍАБЌ͵ЏВВΏЊА͵ЍіЌ͵АЊЌЉ͵Ѝі Projected FY21-23 Benefits FY21FY22ChangeFY23Change Benefits 18.41719.2894.7%20.3755.6% wĻƷźƩĻƒĻƓƷ Ў͵ЋЏВЎ͵ЏЉВЏ͵ЎіЎ͵ВАЉЏ͵Ѝі ht9. Љ͵ЊЉЉЉ͵ЊЉЉЉ͵ЉіЉ͵ЋЉЉЊЉЉ͵Љі ƚƩƉĻƩ /ƚƒƦ Љ͵ЌЎЋЉ͵ЌАЎЏ͵ЎіЉ͵ЌБЏЋ͵Ві ƓĻƒƦƌƚǤƒĻƓƷ Љ͵ЉВЎЉ͵ЉАЎΏЋЊ͵ЊіЉ͵ЉЏЉΏЋЉ͵Љі IĻğƌƷŷΉ\[źŅĻ LƓƭ͵ ЊЊ͵ЍБЏЊЋ͵ЉЉЉЍ͵ЎіЊЋ͵ЏЉЉЎ͵Љі aĻķźĭğƩĻΉ{ƚĭ {Ļĭ Љ͵ВБАЊ͵ЉЉЉЊ͵ЌіЊ͵ЉЋЎЋ͵Ўі tƚƌźĭĻΉCźƩĻ LƓķĻƒ Љ͵ЊЋБЉ͵ЊЌЉЊ͵ЏіЉ͵ЊЌЍЌ͵Њі Projected FY21-23 Capital+Debt FY21FY22ChangeFY23Change Capital/Debt 7.2987.9589.0%7.9810.3% /ğƦźƷğƌ Ћ͵ЌЉЎЌ͵ЊВЎЌБ͵ЏіЋ͵АЎЉΏЊЌ͵Ві 5ĻĬƷ źƓƭźķĻ ƌĻǝǤ Ћ͵ЊЍЎЊ͵ВАЊΏБ͵ЊіЊ͵БЉЌΏБ͵Ўі Ϋ5ĻĬƷ źƓƭźķĻ ƌĻǝǤ ΛƓĻǞΜ ЉЉ͵ЉіЉ͵ЏВЎЊЉЉ͵Љі 9ǣĭƌǒķĻķ 5ĻĬƷ Ћ͵БЍБЋ͵АВЋΏЋ͵ЉіЋ͵АЌЌΏЋ͵Њі Additional Capital mid-year Љ͵ЋЍБЉ͵ЉЉЉЉ͵ЉЉЉ (not included as annual oper) *Energy Improvements II $4.5mil/15yrs Љ͵ЍЌЎ *Downtown Improvments II$2.0mil/10yr Љ͵ЋЏЉ Projected FY21-23 Capital+Debt FY22Cap+Debt /ƚƓƭźƭƷĻƓƷ ǞΉ CLb/ha tƚƌźĭǤυ Ќ͵ЊВЎЎ͵Љі υ ΛЉ͵ЊАЎΜ Ѝ͵Бі υ ΛЉ͵ЌЎЉΜ Ѝ͵Џі υ ΛЉ͵ЎЋЎΜ Ѝ͵Ѝі /ƚƓƭźƭƷĻƓƷ ǞΉ WǒƓĻ γЋЉ ĭǒƷƭ ŅƚƩ CЋЊυ ΛЉ͵АЉЉΜ Ѝ͵Ћі FY22 Capital Requests$ 3.195 CźƩĻ ƌğķķĻƩ ƷƩǒĭƉ ΛЋЉЉБΜυ Њ͵ЌЉЉ 5t wƚğķƭ ΛğƓƓǒğƌΜυ Љ͵ЍЉЉ 5t .ǒĭƉĻƷ ƩǒĭƉ ΛЋЉЉВΜυ Љ͵ЋАЎ {ĭŷƚƚƌ ĻĭŷƓƚƌƚŭǤ ΛƚƓĻΏƷźƒĻ ǞźƩźƓŭΜυ Љ͵ЋЉЉ ƚǞƓ Iğƌƌ ŭĻƓĻƩğƷƚƩ ΛIĻğƌƷŷΜυ Љ͵ЊЋЎ tƚƌźĭĻ ğƭĻƩƭυ Љ͵ЊЊЉ 5t {źķĻǞğƌƉ ΛğƓƓǒğƌΜυ Љ͵ЊЉЉ 5t ĭƩğĭƉ ƭĻğƌźƓŭ ΛğƓƓǒğƌΜυ Љ͵ЊЉЉ {ĭŷƚƚƌ ƓĻƷǞƚƩƉ ƷĻĭŷυ Љ͵ЊЉЉ ƚǞƓ ƓĻƷǞƚƩƉ ƷĻĭŷυ Љ͵ЊЉЉ {ĭŷƚƚƌ tŷƚƓĻƭυ Љ͵ЉЏЎ tĻƩƒ .ƌķ /ƚƒƒ ŅǒƓķźƓŭ ΛğƓƓǒğƌΜυ Љ͵ЉЎЉ CğĭźƌźƷźĻƭ .ƚĬĭğƩ ƭƉźķƭƷĻĻƩυ Љ͵ЉЎЉ 5t ƦğƩƉźƓŭ ƌƚƷƭυ Љ͵ЉЎЉ 5t CĻƓĭĻ ƩĻƦğźƩƭυ Љ͵ЉЎЉ {ƩΉ/ƚƒƒ /ĻƓƷĻƩ tƌğƓƓźƓŭυ Љ͵ЉЍЉ 5t ƩğźƌĻƩυ Љ͵ЉЌЎ tǒĬ {ǝĭ ƦƌğǤŭƩƚǒƓķ źƒƦƩƚǝĻƒĻƓƷƭυ Љ͵ЉЋЎ \[źĬƩğƩǤ {ŷĻƌǝźƓŭυ Љ͵ЉЊЉ 5t ƒƚǞĻƩυ Љ͵ЉЊЉ Reserves September 2020 Free Cash 6/30/20 ( est. & uncertified)$15,005,649 General Stabilization Fund$ 1,707,655* FINCOM Reserves$ 300,000 TOTAL$ 17.01 million ~16.4% of est. $103.7mil. FY21 projected revenue FINCOM 7% Minimum Reserves Policy *total excludes funds designated for specific purpose 5 Year Free Cash Analysis (millions) FY16FY17FY18FY19FY20 Certified Beg. $8.77$9.23$8.57$11.01$15.64 Bal. at 7/1 Revenue over 1.581.332.222. 991.00 budget Expenses under 1.661.662.543.202.87 budget Use of Free -3.32-4.49-1.90-1.0-4.50 Cash Other Adj. to .54.84-.42-.56Not Free Cash known yet Certified Bal at $9.23$8.57$11.01$15.64*$15.01 6/30 *(uncertified) FY22 Free Cash Usage assumes 5% Capital + Debt FY22 Free Cash Usage Operating ($mil)Budgets Љ͵ЉЉΏЉ͵ЌЉі Љ͵ЋЎЉ͵ЉЉі Њ͵ЉЉЊ͵ЋЎі Њ͵ЋЎЊ͵ЏЉі Њ͵ЎЉЋ͵ЉЉі Њ͵АЎЋ͵ЍЉі Ћ͵ЉЉЋ͵АЎі Ћ͵ЋЎЌ͵ЊЎі Ћ͵ЎЉЌ͵ЎЉі FINCOM Meetings Edward Ross, FINCOM Chair FY22 Budget Public Meetings September 23 Financial Forum I October 7Financial Forum II October 21Financial Forum III November 4Regular Meeting (if needed) Dec 9,15 & 16 Attend Select Board January 7,14,21 & 25Attend School Committee February 24FINCOM: School budget March 3FINCOM: Town budgets March 10 & 17FINCOM: Vote Budgets & TM Articles January 31Charter: School Committee Budget to Town Manager February 28Charter: Balanced TM Budget to FINCOM Town of Reading Meeting Minutes 2016-09-22 LAG Board -Committee -Commission -Council: Finance Committee Date: 2020-10-07Time: 8:00PM Building: Location: Address: Session: Open Session Purpose: Financial ForumVersion: Draft Attendees:Members -Present: Chair Ed Ross, Vice Chair Dan Dewar, Nick Boivin, Jeanne Borawski, Eric Burkhart, Marianne Downing, Mark Zarrow Members -Not Present: Sean Jacobs, Andrew Mclauchlan Others Present: Town Manager Bob LeLacheur, Town Accountant Sharon Angstrom, Fire Chief Greg Burns, School Superintendent John Doherty, School CFO Gail Dowd; School Committee Members: Chair Chuck Robinson, Shawn Brandt, Erin Gaffen, Carla Nazzaro, John Parks; Select Board Members: Chair Mark Dockser, Vanessa Alvarado, Carlo Bacci, Karen Herrick, Anne Landry Minutes RespectfullySubmitted By:Jacquelyn LaVerde Topics of Discussion: This meeting was held remotely via Zoom. Chair Ed Ross called the meeting to order at 8:03 pm. Mark Dockser called the Select Board to order. Chuck Robinson called the School Committee to order.School Committee member Tom Wise was not present. General Fund Capital Plan Update: Town Manager Bob LeLacheur briefly reviewed the debt and capital plan. This year, almost $900,000 was cut from what would have been a typical 5% debt and capital plan. If Town Meeting agrees to reinstate $250,000 of capital, that would put the plan back at 4.5%. Not included in the plan this year are the Community/Senior Center and the DPW Project at Camp Curtis Guild. But there will be $10 million-$12 million available for capital projects over the next ten years. Debt Planning General Fund and Enterprise Funds: Mr. LeLacheur provided a brief summary of the debt schedule, future plannedcapital improvementprojects, andthe upcoming warrant articles for debt authorization. There is still a need to be flexible with Capital and Debt for the next few years due to the unknown financial effects of COVID. November Warrant Articles FINCOM Discussion and Vote: Article 3 requests changes to the Capital Plan including: $90,000 for Fire ALS defibrillators; $57,500 for DPW hotbox for pothole repairs;$50,000 for DPW skim coat/crack seal; and $50,000 for Public Services land use planning (Conservation analysis of Symonds Way and Camp Curtis Guild). Page | 1 On a Motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted to approve Article 3 as presented by a vote of 7-0-0. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Eric Burkhart-Yes, Ed Ross-Yes. to spend $837,303 in extra revenue including: $25,000 for Administrative Services COVID expenses; $50,000 for Health Department wages; $20,000 for a Health Department staffing assessment; $75,000 in rubbish expenses; $20,000 for Core Facilities overtime wages related to COVID; $200,000 for PPE; $20,000 for Facilities for Town buildings due to COVID; and $120,000 for School COVID funding. Most of the anticipated COVID related expenses are for cleaning/disinfecting and PPE. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 4 as presented. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 5 requests to pay unpaid bills from prior years. There are currently no unpaid bills, but Town Meeting can address on the floor if anything comes up. On a motion by John Parks, and seconded by Carla Nazzaro, the School Committee voted 5-0-0 to adjourn at 9:33 pm. Roll call vote: Carla Nazzaro-Yes, Shawn Brandt-Yes, John Parks-Yes, Erin Gaffen- Yes, Chuck Robinson-Yes. On a motion by Carlo Bacci, and seconded by Karen Herrick, the Select Board voted 5-0-0 to adjourn at 9:34 pm. Roll call vote: Carlo Bacci-Yes, Karen Herrick-Yes, Anne Landry-Yes, Vanessa Alvarado-Yes, Mark Dockser-Yes. Article 6 requests approval of the Affordable Housing Trust Fund Allocation Plan. The current balance of the fund is just under $400,000. To spend money from this fund requires a joint meeting of the Select Board and Reading Housing Authority. On a motion by Mr. Burkhart, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 6 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 7 requests authorization to borrow $1.1 million for water main improvements in the Gazebo Circle area. Town Meeting voted to approve $1 million in March, but the estimated cost of the project increased $0.1 million. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 7 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 8 requests authorization to borrow $1.5 million from the MWRA to de-lead old connections between water mains and houses. On a motion by Mr. Burkhart, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 8 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 9 requests authorization to borrow $4.3 million ($1.3 million from MWRA plus $2.8 million from other sources) for water main improvements to the downtown area. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 9 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Page | 2 Article 10 requests authorization to borrow $1 million for sewer system improvements in the Haven Street area. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 10 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 11 requests authorization to borrow $1 million for drainage improvements in the Haven Street area. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 11 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Article 13 requests to authorize the Select Board to accept a parcel of land abutting Timberneck Swamp as a gift to the Town to be preserved as Conservation land. The land will be donated and there will be no cost to the Town. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve Article 13 as written. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Discuss Financial Forum October 21 (Focus on FY22 Budgets): st Topics anticipated at the next Financial Forum on October 21 will include: accommodated costs, policy on OPEB, discussion on free cash, and a comparative look at budgets with various use of free cash. There will be a request for a community priority for the ad hoc udget for an Executive Director for the Reading Alliance for Equity and Social Justice (RAESJ). Minutes: On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to approve the meeting minutes of September 23, 2020. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. On a motion by Mr. Dewar, and seconded by Ms. Downing, the Finance Committee voted 7-0-0 to adjourn at 10:06 pm. Roll call vote: Dan Dewar-Yes, Mark Zarrow-Yes, Eric Burkhart-Yes, Jeanne Borawski-Yes, Nick Boivin-Yes, Marianne Downing-Yes, Ed Ross-Yes. Page | 3