HomeMy WebLinkAboutCapital Improvements 04/25/2006Capital Improvements Committee
Minutes of April 25, 2006
Present: Kenneth Gay, MBC, Chair; David McCarter, Board of Selectmen; Johne `'' 12
DeMassi and Kenneth Torman, Planning Board; Charlene Lavin, Finance Committee,
Mike Trowbridge and Jean Miller, School Committee X 1 IS E TTS
John D'Agostino, Town Manager; Shaun P. Burke, Director of Planning and
is To appoint Mr. DeMassi Acting Chair
(Torman-McCarter) All in favor. PASSES
Mr. D'Agostino discussed the funding mechanism and handed out a spreadsheet showing
the amount borrowed for capital improvements, approximately $1million in FY 05 and
$2.8 million in FY 06. That resulted in principal and interest on an annual basis of
approximately $1 million. Mr. D'Agostino said that principal and interest would be paid
down to $685,908.37 in FY 07.
Mr. D'Agostino suggested that the members review the spreadsheet for the cost of
borrowing an additional $1 million to fund the proposed capital plan, adding to the
additional debt service and bringing the annual debt service to close to $1 million.
[Mr. Gay arrived at 6:15 p.m.]
The committee discussed the cost of borrowing and the wisdom of continued borrowing
to fund capital acquisitions. Two philosophies were discussed: first, paying down the
existing borrowing and using available funds to raise and appropriate on an annual basis
to fund the proposed capital budget; second, to maintain the current philosophy of
borrowing for capital acquisitions with the goal of keeping annual debt service at or near
$1 million.
The group decided the first decision it should make is whether to borrow more money.
Ms. Lavin asked the Town Manager what would happen if we didn't have new capital
borrowing, and what would become available for a capital improvements plan, assuming
the FY 07 principal and interest costs for capital items is $685,908.37 and $658,101.64
for FY 08. The difference between the two numbers becomes the funding source for the
following capital budget. Mr. D'Agostino said the difference between principal and
interest payments in FY 07 and FY 08 will be approximately $30,000. So if the interest
is to keep the current capital principal and interest debt level of approximately $686,000,
it would only free up about $35,000 for new capital spending.
The question was asked how much of the $1.3 million the Town Manager has proposed
for inclusion in the FY 07 capital budget the Finance Committee wants removed. Ms.
Lavin said the Finance Committee has removed all $1.3 million that had been budgeted
by the Town Manager.
There was further discussion of the means to fund the $500,000 for the school expansion
plans and whether the committee can support that expenditure without knowing the
funding source.
The committee requested the cost of borrowing be established by the Town Manager in
order to continue the discussion about whether or not borrowing is the most appropriate
means through which to fund the capital plan.
The committee discussed its priorities for FY 07. It was discussed that these priorities
should most appropriately be established according to public safety needs. It was further
decided that the $500,000 for the school expansion plans, as it is a separate question, will
be dealt with separately at CIP.
Following discussion, it was decided that the top three priority items are:
1. Police radio system $274,000
2. Town Hall carpeting $90,000
3. Highway Garage air exchange system $300,000
4. School Street interceptor $455,000 The interceptor will be funded out of the rates,
rather than though raise and appropriate.
The committee discussed the priorities for the School's safety improvements and the
School's priorities. Mr. Trowbridge and Ms. Miller said they would be getting additional
information from the School Committee to bring back to the group.
There was discussion about the carpet replacement and the chiller conversion. Mr. Gay
volunteered to talk with Mr. Parker at the School Department about the chiller
conversion. It was decided to defer discussion of the School requests until May 2.
Minutes of April 11, 2006
Motion: To approve as amended
(Torman-McCarter) All in favor. PASSES
The committee discussed the Special Town Meeting warrant article to allow the School
Committee representatives to be voting members of the Capital Improvements
Committee and encouraged the members to support the article.
Motion: To adjourn at 7:15 p.m. (Torman-Dolan) All in favor. PASSES
Datp of next meeting: Tuesday, May 2, 2006 at 6:00 p.m.
ignature of Chair Date ofApproval