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HomeMy WebLinkAbout2005-02-02 Finance Committee MinutesCEIVEO T 0'0/N CLERK ;FADING. MASS. Finance Committee Meeting 2005 MAR 8 P 1: 0 q February 2, 2005 The meeting convened at 7:30 p.m. in the Town Hall Conference Room, 16 Lowell Street, Reading, Massachusetts. Present were Chairman Jim Francis, Vice Chainnan Chuck Robinson, Finance Committee Members Dick McDonald, Bob LeLacheur, Paul Bolger, Marsie West, Hal Tonnan, Michelle Williams and Andrew Grimes. Also present was Town Manager Peter Hechenbleilcner. Approval of Minutes On motion by LeLacheur seconded by McDonald, the Minutes of October 21, 2004 were approved, as amended, by a vote of 9-0-0. Liaison Reports Dick McDonald reported on the School Committee budget process. Superintendent of Schools Pat Schettini presented a 4% budget and a 2% budget, and an analysis of what would be added back in above the 2% budget to get to the 4%. The School Committee had a hearing and it was not well attended. At the last meeting, the School Committee decided to wait until February 7, 2005 to adopt the budget. They wanted to see the impact of the redistricting on the budget. Labor negotiations are ongoing. The 4% budget adds five elementary school teachers, and a 2% budget adds three elementary school teachers. Under the 4% budget, there is a computer tecluzician on a frill-time basis and in the 2% budget, there is a computer technician on a half time basis. There is reduced professional development money in the 2% budget. In the 4% budget, there are four unanticipated SPED additions, and there are two unanticipated SPED additions in the 2% budget. Paul Bolger indicated that he has been at two of the last three RMLB, meetings, and he is learning a lot. He was impressed by the professionalism of the Board. Bob LeLacheur reported on the Hospital Development Committee. The Committee has detennined that a hospital is not feasible. The secondary purpose of the trust fund is to help the needy of Reading with medical expenses. The process now is to look at alternatives including bricks and mortar alternatives and service alternatives. There is a host of possibilities. We are currently spending $100,000- $200,000 and the people who are benefiting from those programs will not be forgotten. If anything other than what is being done now with the mist fiinds is to be done, it will be probably require legal steps. FY 2006 Budget Update - The Town Manager reviewed the FY 2006 Budget update which included a review of the revenue projections and expense projections. He noted that the material presented was accurate and focused for 2006 and the projections for 2007, 2008 and 2009 had not been done. Major changes were to provide a small increase in the provision for abatement and exemptions of $10,000, State Aid figures from the Governor's budgets are now known, the Reading Ice Arena Authority distribution number has been received, there is an increase in interest earnings, and the overlay surplus numbers are known. The total revenues will be ( $64,221,000 or 'a 3% increase. Finance Committee Meeting - February 2, 2005 - Page 2 The expense projection shows requested budgets the so-called "4% budget" for the Schools, a ( 4.5% increase in expenses for the Town, a 14.79% for building maintenance, plus debt service employee benefits and State assessment. The shortfall between the requested budgets and the available revenue is $620,000. The Town Manager reviewed a model based on the percentages that each of the three categories of Town, School and Facilities snake up are the total and projecting that forward to 2006. The result is that the Town budgets would increase $399,000, the School budget would increase $803,000, and the Facilities budget would increase $99,000. There was considerable discussion about the different elements to the budget. Dick McDonald noted that the School budget includes a $400,000 increase in Circuit Breaker Funds that are available to the School Department without appropriation. Those monies equal about 1.25% increase of the budget. Therefore, the School budget as requested a 2.83% increase is actually closer to a 4% increase. There was discussion about the increase in energy costs for the Facilities budget. The projected increase for gas is $109,000, and the projected increase for electricity is $62,000. There was discussion as to whether or not the electricity costs increases at 5% were based off of the actual 2005 expenditures or the 2005 budget. The Town Manager noted that the 2005 expenditures should be less than budgeted because of the RMLD rebate. The School Committee asked for some history of the percentage changes in relative share of Town, School and Facilities budgets. It was noted that Medicaid reimbursement seems aggressive. The Town Manager noted that the School Department has been very aggressive j about Circuit Breaker and Medicaid reimbursement and is doing very well. The $450,000 is a very realistic number. The School Committee agreed to meet for its initial budget presentation on February 16, 2005, and then to meet the five Wednesdays in March to review the budget and finalize their deliberations at the end of March. This would give adequate time to put together the report. Reserve Fund Transfet The Town Manager presented a Reserve Fund Transfer in the amount of $58.00 for the Vocational School. When the budget was revised in the Fall, we inadvertently reduced $58.00 more than the assessment. On motion by Robinson seconded by Torman, the Finance Committee voted to approve a Reserve Fund Transfer in the amount of $58.00 for the Vocational School Assessment by a vote of 9-0-0. Discuss the Process for the Hiring and Transition to the new Town Accountant and Finance Director - The Town Manager reviewed the hiring process for the Town Accountant and the Finance Director. Marsie West and Bob LeLacheur were appointed to work with the Town Manager in the Finance Director's position. Dick McDonald will be the Finance Committee representative on the Town Accountant search. Finance Committee Meeting - February 2, 2005 - Page 3 - Approval of Deferral of Snow/Ice Expenditures until the FY 2006 Budget Year - The Town Manager reviewed the requirement of Chapter 44, Section 31D to defer snow and ice expenditures from FY 2005 to the FY 2006 budget. In a letter dated February 2, 2005, the Town Manager noted that he was approving the incurring of liability and making expenditures in FY 2005 in excess of available appropriations for the snow and ice removal subject to approval by the Finance Committee. On motion by McDonald seconded by Bolger, the Finance Committee voted to approve pursuant to Chapter 44, Section 31D of the Massachusetts General Laws the incurring of liability in making expenditures in FY 2005 in excess of available appropriations for snow and ice removal. The motion was approved by a vote of 9-0-0. Preliminary Look at Annual Town Meeting Articles - The Town Manager reviewed likely Town Meeting Articles. Reorganization due to Resignation of Jim Francis - The Finance Committee discussed reorganization as a result of the resignation of Chairman Jim Francis. The issue of reorganization will be whether or not to elect a Chairman in Mr. Francis' place and, if so, whether or not that would take place through June 30th of this year or June 30, 2006. Following discussion, the Finance Committee decided to have Vice Chairman Chuck Robinson assume the duties of Chairman without any fiirther action. Jim Francis thanked the Finance Committee for their hard work. He feels that this is the best ( Finance Committee that we've had, and he has thoroughly enjoyed his work with the community. Chuck Robinson thanked Jim for his outstanding work and leadership. On motion by Francis seconded by McDonald, the Finance Committee voted to adjourn their meeting of February 2, 2005 at 9:05 p.m. by a vote of 9-0-0. Respectfully submitted, i e reta