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HomeMy WebLinkAbout2006-05-17 RMLD Operating and Capital Budget Subcommittee MinutesRECEIVED Reading Municipal Light Department (RMLD) Board of CommissionersT O N CLERK Operating and Capital Budget Subcommittee Minutes READING. MASS. Date: Wednesday, May 17, 2006 Time: 7:00 p.m. Place: Cafeteria Attendees: Board: Messrs. Pacino, Hahn, Soli, and Ms. O'Neill Staff: Messrs. Cameron, Dion, Donahoe, Fournier and Seldon Mses. Antonio, Cavagnaro, O'Leary and Parenteau CAB: Messrs. Lessard, Norton, Carakatsane To discuss Fiscal Year 2007 Operating and Capital Budgets. Regular business of the Operating and Capital Budget Subcommittee. Commissioner Hahn called the meeting to order at 7:00 p.m. 2001 MAR 20 P 5. 02: Mr. Hahn opened the meeting by stating that the first order of business is to discuss the Operating Budget. Mr. Cameron reported that there was no motion made on the Capital or Operating Budget at the last Subcommittee meeting. Mr. Hahn said that by way of introduction, the Subcommittee met with the Mr. Cameron and many of the staff to go over the budgets. Mr. Hahn said that there were many questions and staff worked hard to get the answers back to them. Mr. Hahn said that as a personal aside staff did a very good job in answering the questions. Ms. O'Neill said that she has received answers to her questions, but she has some issues that need some considerations. Mr. Hahn asked what considerations before budget approval does Ms. O'Neill need to assist her? Ms. O'Neill replied that is her preference and she does not feel comfortable making a recommendation at this point. Mr. Hahn asked what information did Ms. O'Neill need to make her comfortable at this point, more information from the staff? Ms. O'Neill replied that it is not more information she needs. Ms. O'Neill said that her main concern is that when the RMLD Board adopts the Capital Budget that the RMLD is making a commitment that the projects are being done and if they are not completed it needs to be evaluated. Ms. O'Neill said that a Capital Plan is not just that an "x" amount of money that is being expended. Ms. O'Neill said that there should be not only an overall company plan, but specific Capital Plan of where the RMLD is going, what specific needs to be done, what are the priorities and what needs to be done to accomplish this. It can be done over a five to eight year timeframe. Operating and Capital Budget Subcommittee Minutes 3 May 17, 2006 Mr. Hahn explained to Ms. O'Neill the Capital Budget has been prepared and proposed for acceptance, which has a very high level of detail. Mr. Hahn asked if she wants this for five years projected out? Ms. O'Neill replied that she wanted to know what all the projects relate to. Ms. O'Neill used the example of the Lynnfield substation in that she knows that it is closing therefore that is the goal, what will get the RMLD to that, and the projects would be tied to it. Ms. O'Neill is not opposed to the Capital Budget. Ms. O'Neill said that she would like to see these projects tied into goals. Mr. Cameron said that he has to work with Ms. O'Neill on her suggestions. Mr. Cameron asked is the current detailed Capital Budget, is that acceptable, as it has been presented? Ms. O'Neill said that, "yes" she can accept this present Capital Budget, because she has no particular issues with it. Ms. O'Neill said that would like future budgets to reflect her suggestions. Ms. O'Neill added that once the budget is approved the RMLD will do these projects. It is not a matter of money; the staff then completes the projects. Mr. Hahn said that is a plan that is not set in stone. At the end of the year, if half of the projects are completed then the other half were not completed due to emergencies or were deemed an opportunity for other work he would not be in favor of criticizing Mr. Cameron after the fact for adjusting for prudent decisions relative to the implementation of these items. Ms. O'Neill said that she would like to have the opportunity to look at these changes. Mr. Hahn said that the RMLD Board has an opportunity every month to look at these in the Financials to see where the capital money are going. Mr. Hahn said that Mr. Fournier has been cooperative in providing more detailed information. Mr. Hahn said that he is agreement with Mr. Cameron that if he had to describe what Ms. O'Neill wants he could not do it right now. Mr. Hahn said that suggestions made could be used for the next budget process. Ms. O'Neill said that it is worthwhile to have the Board discuss those suggestions in order to get them in place. Mr. Cameron said that the RMLD would work with Ms. O'Neill on her suggestions. Mr. Hahn made a motion seconded by Ms. O'Neill that the Operating and Capital Budget Subcommittee recommend approval of the 2007 Capital Budget to the RMLD Board of Commissioners. Motion carried 2:0:0. Mr. Cameron said that on the Operating Budget two changes have come in. One change is on the Power Supply side and the other is internal to the Operating Budget. Mr. Fournier explained that there were two items that need addressing Mr. Fournier said that the first adjustment was an item mishandled by himself in the Capital Budget but does not change it. It concerns the Forced Account work that the outside crew that Halpin would be doing. This line was omitted in the Operating Budget. Mr. Fournier stated that in the Operating Budget he overstated his expenses in the Operating Budget in the line section of the E&O Division, the effect is that it would add $166,000 to Net Income. Mr. Fournier said the second change had to do with Purchased Power costs. The RMLD received harder costs of $1.5 million for transmission in fiscal year 2007. These changes take the Net Income from $2.7 million to $1.3 million in the Operating Budget. Mr. Hahn asked is this an adjustment to the 2007 budget? Operating and Capital Budget Subcommittee Minutes 5 May 17, 2006 Mr. Hahn said they will be making a report to the full Board and the suggestions can be brought forward at this time. Ms. O'Neill made a motion to recommend approval of the 2007 Operating Budget to the RMLD Board of Commissioners. Motion carried 2:0. Ms. Parenteau added that Mr. Cameron did have department managers provide information for a master plan, which was long term plan. Ms. Parenteau pointed out Mr. Cameron has started the process. Ms. O'Neill said that the communities should be solicited for thoughts and concerns to set the broad items. Ms. Parenteau said that the RMLD has recently conducted a residential customer survey as a means for feedback and is in the processing of developing a commercial survey. Mr. Cameron said that the Citizens' Advisory Board is a resource that can be relied on heavily because they represent the four towns the RMLD services. Ms. O'Neill made a motion seconded by Mr. Hahn to adjourn the meeting. Motion carried 2:0. Meeting adjourned 730 p.m.