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HomeMy WebLinkAboutmin of fin com 11062008 Town of Mansfield Finance Committee Workshop Minutes of November 6, 2008" Er~r:{li/E~D ...... ..~" '---~ '..... ICE Attending: Andres Gazzolo James Lazzara Jack Goldberg Tommy Ratliff Charlene Lavin Karl Chambers ') I {\ Jr.".. 5 3 t. If-\. iU" Motion: To Open at 7:30p.m. (Lazzara - Goldberg) 6 - 0 Passes Capital Budget Mr. Gazzolo brought up some of the meetings that had been going on that day. He said that he met with the new Treasurer and they discussed the details of Capital. They discussed the financial forecast that the Finance Committee had previously prepared. They determined that in fiscal year 2010 the town should have approximately $6million in debt and that of that amount $5million is excluded; so when the $5million is retired they can not borrow again until the town votes on it. Mr. Gazzolo went on to say that they are thinking of this in terms of financing capital and that it would be included in the budget. He said that they are attempting to plan for the foreseeable future. Mr. Lazzara suggested that the Finance Committee look at this fin terms of what the town needs, not how much money they have to work with. Mr. Goldberg said that the Finance Committee can only determine how much they have for capital projects and then it is up to the Capital Committee to prioritize their projects. Covidien TIF Presentation Pat O'Rourke and Lynn Tokarczyk presented the TIF proposal to the Finance Committee. The Board of Selectmen already approved the proposal and the TIF projects will be going to vote at the town meeting. Ms. O'Rourke explained that Covidien is made up of three companies and they are in negotiations to purchase the building at 777 West St. in Mansfield. Covidien is currently leasing four other buildings in the Cabot Industrial Park and this purchase would be in addition to the four leased properties. If the TIF is approved what Covidien would like to do is purchase that property and once it has been renovated move all of the research and development into this facility as well as add 50 new employees to this area. Building one would be renovated to become all office suites and more employees would shift into that space; Covidien would not be giving up any properties as part of this plan. Ms. Tokarczyk said that Covidien would purchase the building at 777 West St. for approximately $27 million. They would then spend an additional $16 million on renovations of that building as well as building one. The TIF would give a 20 year exemption to Covidien beginning at 100% exemption and working down to 5% exemption for the last five years. Mr. Goldberg questioned whether Covidien would ever be moving any of their manufacturing to Mansfield. Ms. O'Rourke responded that currently Covidien is focusing on Mansfield for research and development and as their world headquarters. Ms. Lavin questioned that since Covidien leased all of their other space why would they now want to purchase this property. Ms. O'Rourke responded that the building in question was not available for lease, only sale and that since the proximity to their other buildings is ideal they made the decision to purchase. Mr. Goldberg asked whether there had been any comments from the TIF Committee on this. Mr. Gazzola responded that it seemed to him as though 20 years was a very long time but that since Covidien is such a large employer and they have been an asset to the town he felt that it would be alright in this circumstance to go for such a long time. Mr. Lazzara questioned the timeline on this project and if the TIF would begin for fiscal year 2011. Ms. O'Rourke responded that it would begin in 2011 and that otherwise ,.. timing is a little unclear. They would like to take possession of the building by the end of 2008 and begin renovations in the spring of 2009. Ms. O'Rourke told the Finance Committee that there is an informational session set up for the citizens on Thursday, November 13 from 6:00 to 7:00 at the Mansfield Holiday Inn. Vote Motion to approve the Covidien TIF. (Lavin - Lazzara) 6 - 0 Passes MedLine TIF Presentation Ms. Tokarczyk presented the MedLine TIF proposal to the Finance Committee. She said gave an explanation of what MedLine produces and then gave an overview of MedLine in Mansfield. She said that MedLine has been in Mansfield for more than ten years and that they did apply for a TIF in 2004 but that since they were unable to come to an agreement with the landowner their project fell through. What MedLine would like to do now is construct over 325,000 square feet of space, one of the largest construction projects in the area, and add ten new positions to their operation in town. The cost for this project is approximately $16 million. The TIF would be for ten years with a move from 100% exemption in the first year to a 5% exemption in the last five years of the TIF. There is also the possibility of a three year extension to this TIF at 5% exemption. Mr. Ratliff questioned whether the TIF Committee had any thoughts on the three year extension. Mr. Gazzola responded that the TIF Committee did look at this and they were comfortable because the three year extension is only provisional at this point. Mr. Gazzolo told the Finance Committee that the TIF Committee did approve of this TIF proposal but only after it had been renegotiated. He said that the MedLine proposal is not as strong as the Covidien proposal but that the company was still a strong presence in the community. Mr. Lazzara questioned whether there had been a traffic study conducted of the intersection where MedLine is proposing to build their facility. Ms. Tokarczyk said that all traffic issues were addressed by the planning board and that it had already been approved. She went on to say that the project would likely break ground in early spring. Ms. Tokarczyk told the Finance Committee that there is an informational session set up for the citizens on Thursday, November 13 from 9:00 to 10:30 at the Council on Aging. Vote Motion to approve the MedLine TIF (Lazzara - Chambers) 5 - 0 Passes Financial Overview Mr. Gazzolo told the Finance Committee that the recommendation that they had made to the Board of Selectmen in regards to a budget freeze was not approved. He said that Mr. Aptowitz made a motion and the result was 2 - 2 - 1. He said that he feels that the financial situation in town is being held up because of political issues. Mr. Gazzolo went on to say that the comments in regards to the no votes on this motion were vague. Mr. Gazzolo said that there are issues for fiscal year 2009 budget wise. The state made a cut of $11 billion which will eventually have an effect on the town. He said that the town would do best to cut expenses by not replacing people who retire rather than to hire someone new knowing that you will need to fire them a year later. Mr. Gazzolo said that a memo had gone out that day that said the town is forecasting a $1.8million deficit for fiscal year 2009. He said that it appears to be all in local receipts and that he is waiting for further information on this. Mr. Goldberg pointed out that the motion that had not passed the night before was voted down because they wanted to wait until a situation arose that would require a freeze to review it and then that situation is raised the next morning. Mr. Goldberg said that it is troubling that this was not realized before and that he is concerned if it was realized before why was nothing done about it. Mr. ,.. Gazzolo said that the Finance Committee had already predicted a $2 million shortfall for fiscal year 2010; now they are just faced with it sooner than they were prepared to be. Mr. Gazzolo suggested that the Finance Committee may need to set up a special meeting with the major action being to review the five year forecast and to review fiscal years 2009 and 2010. Discussion Mr. Gazzolo said that he has spoken with the chair of the School Committee and that they would like to see the same presentation that had been given to the Board of Selectmen. Mr. Gazzolo mentioned the executive session that the Finance Committee wants to hold with the Board of Selectmen and the School Committee. He said that the School Committee has raised concerns that discussing contract negotiations will cause a legal problem as they can not go into contract negotiations with a set amount in mind; it is supposed to be good faith negotiating. He said that he has gotten some legal advice on this and that as long as the group gives a guideline for negotiations and not a cap there is no legal problem. Mr. Gazzolo said that he has asked for that statement to be put in writing. Mr. Gazzolo said that the Board of Selectmen had set the tax rates the night before. He said that it puts a little more burden on the commercial/industrial base and a little less to the personal base. He said that this is in relation to the residential property values dropping 6% and the commercial real estate values did not move. Mr. Gazzolo asked Mr. Goldberg if there had been any movement on the formation of an audit committee. Mr. Goldberg said that he has not heard anything since it was enacted. He was planning to send a memo to the Board of Selectmen to see if there has been any further action regarding this. Mr. Gazzolo said that the Finance Committee needs to prepare for the town meeting. He said that they need to have recommendations for the Board of Selectmen and School Committee for the town meeting. Mr. Goldberg said that the money that the police department has requested to purchase tasers is now going to be proposed that it come out of the revolving account and not the salary budget as had been originally been requested. The purpose of the revolving account is for permitting of firearms. They are now planning to petition that they be allowed to use it for the purchase of tasers. There is a significant cost to the town when an officer fires a gun; the town then needs to provide mental evaluations, overtime for covering an officer that is off, and so on. He said that the use of tasers will eliminate some of those costs as it is a nonlethal weapon. Mr. Goldberg went on to say that the fines for firearm permits rose significantly while Governor Romney was in office. This account has gone up accordingly. Mr. Lazzara suggested that if this account holds more money than they are able to use they should look into using those funds for something else. Mr. Gazzolo said that he had previously asked Mr. D'Agostino to look into this account to see if there is any way funds over a certain amount could be moved into the general fund. The Finance Committee decided to hold a special meeting on Wednesday, November 12 at 7:30 to further discuss the deficit. Vote Motion to approve minutes of October 30 Finance Committee meeting. (Lazzara - Chambers) 5 - 0 Passes Motion: To Close at 9:35p.m. (Goldberg - Lazzara) 5 - 0 Passes O' ~ ) I' /'/1.1 .Y. ).J1)JJ../J j ( . /1 {fY, r-'h~ Signature of Cler II II ?)/ 0 Y 'Date 'of Approval 1'1"