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HomeMy WebLinkAboutFinance Comm 04/12/2018Finance Committee Meeting Minutes RECEIVED April 12, 2018 TOWN CLERKS OFFICE 1019 FEB —b P 5. 08 Present: Mr. Walter Wilk, Chairman; Mr. Scott Feely, Vice Chairman; Mr. Brian Eagle, Clerk; Ms. Kathleen Aguiar; and Mr. Michael DeSantis MANSFIELD Not Present: Mr. Yogen Chemburkar & Mr. Michael O'Brian MASSACHUSETTS Also Present: Mr. Kevin Dumas, Town Manager; Mr. John Stanbrook, Finance Director and Town Accountant; Ms. Teresa Murphy, Superintendent; and Mr. Edward Donoghue, Assistant Superintendent BOS: Mr. Michael Trowbridge, Chairman; Mr. less Aptowitz; Mr. FrankbelVecchio; and Mr. Steve Schoonveld School Committee: Ms. Kiera O'Neil, Chairman; Ms. Lynn Cavicchi, Vice Chairman and Ms. Jenn Walsh 1. Call the Finance Committee meeting to order and review the aeenda Mr. Walter Wilk called the meeting to order at 7:01PM and stated it is a joint meeting with the Board of Selectmen and School Committee and thanked them for being present. He stated that the budget is balanced at present time but still need to review warrant articles which the Finance Committee usually does two weeks prior to Town Meeting. Mr. Wilk stated that Capital Improvement Projects will be discussed and voted on during this meeting. Mr. Dumas states that the town budget is balanced and will not be using any free cash.and that the Town has identified "tier one" needs and meetings goals for all Town departments. Superintendent Murphy states this has been a positive budget experience this year for the schools due to a collaborative effort between the committees and departments. Board of Selectmen Chairman Trowbridge stated that the Board of Selectmen will be reviewing final budget on April 25 and making recommendations on the applicable warrant articles. Mr. Eagle asked Mr. Dumas about parking fees that was discussed at the April 5, 2018 meeting. Mr. Dumas stated that the information had not been completely compiled yet but would forward to the Committee and Mr. Stanbrook, added that the general fund had no parking increases included. 3. CIP update and discussion Mr. Feely (CIP HANDOUT) stated that free cash is being used for CIP in the amount of $1,712,700. He stated that he would like to discuss funding for CIP while BOS was present. He continues and says that the use of long term debt and short term debt are higher than in previous years and asks Mr. Dumas to speak to that. Mr. Wilk clarifies that free cash is being used to pay for the majority of the projects but there are potential bonds for some projects to include the $2 million road bond will be continuing as part of five year project as well as the underpass/overpass project with matching funds, $600,000 for fire station repairs and Memorial Hall improvements along with short term debt to fund a new firetruck. Mr. Feely states that these projects have been approved by the CIP Committee and the next step is to present to the Finance Committee and Board of Selectmen before becoming warrant articles. Mr. Dumas states that the $2 million road bond will be funded as in previous years. The North Main Street underpass/overpass project is a joint project with the state because the Town has a bridge and residents should be happy that we got a 100% match on the underpass project and a 50% match on the school roof project last year. Selectman DelVecchio states concern about budget sustainability and that we do not want to tie our hands going forward and would like further information from management. Mr. Feely states that the CIP Committee makes recommendations on how the projects are financed and the more in depth financing discussions are in Finance Committee and Board of Selectmen. Mr. Feely states that the Plymouth Street fire station is $660,000 in long term debt. Mr. Dumas says this project includes design & repair HVAC and building improvements that includes windows, roofing and siding. This amount of $660,000 will bring total amount for renovations to $1.2 million and will add 20 plus years of life to the Plymouth Street fire station. Mr. Eagle asks about costs overruns at the new DPW/Public Safety complex and Mr. Dumas states that they are currently under budget and will not be asking for any new borrowing for this project. Mr. DeSantis asks what the difference is between long term debt and short term debt financing and Mr. Dumas responds that with short term borrowing we have 0-10 years and only paying interest payments and can pre -pay principal without penalty and longterm debt is sold on the market for a specific time with one principal and two interest payments annually and pre -payment is not allowed and there is usually a "call" around ten years into the debt. Mr. Feely continues saying that the Memorial Hall project was being requested as short term debt and Mr. Dumas says project is for the external architectural design and repair. $330,000 has already been appropriated to the project but it has not been awarded yet so requesting an additional $360,000 for the exterior to bring the total to $811,424 and these improvements will add more than forty years to the life of the building. Ms. Aguiar questions the amount of money for the project versus the market value of the building and it is because of the historical nature of the building and other factors such as the size of the windows. Ms. Aguiar asks if the town has a policy for its debt level and Mr. Wilk said we may need to do some research on what other towns have. Mr. Wilk states that historically they have tried to keep CIP spending to the $2 million for the roads and free cash for the rest of the projects but the first big bond issue was the DPW/Public Safety complex and several years ago the Town hired a firm to go out and inspect the town buildings including the schools to get an idea of what their future needs would be so there is an outline of the projects with most of them being needed to be done in the first five years due to the neglect. Mr. Wilk also stated that the town is only spending $2 million annually on roads because that is all the current DPW staffing can handle. Selectman Aptowitz states that the debt service policy is percentage of town and school operating budgets around 2-10% and further states that in order to balance the budget in years past the capital improvement line items were removed from the budget. Mr. Dumas states that the fire engine replacement will be financed by using short term debt in the amount of $660,000. Selectman Aptowitz did not know about this project and Mr. Feely states that it was not on the fire department's original plan but it has to do with the deterioration of the frame. Mr. Dumas states that there are also other issues to include needing a complete rewiring of the radio system and structural issues with the frame. Mr. Wilk asked if there were lease -to -own options as they had done in the past with police vehicles but Mr. Dumas said he hopes this is one of the items they would be able to purchase with free cash in the fall and not have to bond. Selectman Aptowitz would like to look at the entire fleet and a revolving plan for replacement like with the ambulances. Mr. Dumas says that is part of what they are looking at for a regular replacement schedule along with setting aside money for the replacements. Mr. Eagle asked if there are going to be any other surprises in the fleet and Mr. Feely stated that this came to light when the state did an in-depth inspection. Mr. Dumas stated this was one of the reasons that central fleet maintenance was put into the FY 2019 budget and that the new DPW building has the large lifts that can accommodate fire equipment and technicians will be getting training on how to work on these vehicles. Ms. Aguiar asked if we recover any costs when the fire truck goes out of service and Mr. Dumas states that if the vehicle based on age and service hours it could be kept as a reserve but in this case that would not be appropriate so they will put it out for surplus and get bids and any recovered money from the sale would go to free cash. Mr. Feely states that was all of the large CIP items that would possibly require indebtedness. Selectman Aptowitz had questions about vehicles such as a pickup truck for DPW and all -wheel drive Tahoe police pursuit vehicle and explains that this is the first time the Board of Selectmen have seen the CIP proposal. Mr. Lee Azinheira, Director of Public Works, stated that this pickup truck would replace a sixteen year old Ford Ranger currently used by public buildings. Selectman Aptowitz asks if the forensic software was an upgrade to the current and Mr. Dumas replied that is a completely new system. Selectman Aptowitz asks if the $25,000 for the software included training or not and Mr. Dumas replied he would find out. Mr. Feely stated that the website project was extremely important and deferred to Mr. Dumas for further information. Mr. Dumas states that the current website is old and is not state-of-the-art. Mr. Eagle asks what the $40,000 includes and Mr. Dumas responds the design and the first year of maintenance and between $3000-$5000 annually for maintenance. Mr. Eagle asks if the schools and anything associated with the Town were included and Mr. Dumas responds yes. Mr. Wilk points out that Town website is our "front door" for people looking to move or locate businesses in town. Mr. Eagle asks about a line of $60,000 for radios and Mr. Feely states this is just in case something happens to the current system before the State can take over and Mr. Stanbrook confirms. Mr. Feely continues to state that the CIP Committee was attempting to not neglect any one area and making smart investments and gives example of equipment trailer to store and move the Town's new voting equipment. Mr. DeSantis asks for clarification about some of the enterprise fund retained earnings and Mr. Wilk and Mr. Stanbrook explain that this money is a funding source from specific accounts and is being used in other requests. Ms. Aguiar asks about the line item for a $600,000 salt shed that was not approved and Mr. Feely explains that $25,000 was approved for a long-term plan and future project and this will be used to prepare site. Mr. Dumas states that shed will be across the street from DPW/Public Safety complex and this amount will be used for permitting, tree clearing and site preparation and the total salt shed project is expected to be $1.2 million. Mr. Feely states that the amount of free cash the CIP Committee used is similar to past few years. Mr. Wilk asked how much in projects the CIP Committee did not approve and Mr. Feely states approximately $1.6 million. Mr. Feely states that the Finance Committee should vote on supporting the CIP budget due to the timing of the next meeting and the next Board of Selectmen meeting. Mr. Wilk states that there are still some questions regarding the bonding for the underpass/overpass project and Mr. Dumas states no more than 20 years and Mr. Stanbrook says that he looked at laddering the funding. Mr. Dumas confirmed that the maximum debt load on the budget for FY 2020 was $300,000. Mr. Wilk explains that the Finance Committee votes to support or not support the CIP budget as presented by Mr. Feely and that if they get any further information that would make the Finance Committee change their support they could do that at a later date. Mr. Feely states that the amount of debt based on the size of the Town budget is barely making the Town's debt ratio meet State recommendations. Ms. Aguiar asks if this amount was just long term debt and Mr. Dumas stated it was both long term and short term debt. Mr. Wilk continues to state that the Town has a very disciplined bond approach and most projects have been paid for with free cash instead of bonds. Mr. Eagle asks if the CIP Committee is going to start using a capital stabilization fund and Mr. Feely states that not until the stabilization fund is above the minimum. Motion: To support the Capital Improvement Project (CIP) Budget as presented. (DeSantis/Eagle) Passes 5:0 4. Next steps in budget and warrant article review Mr. Eagle and Mr. Wilk confirm the next Finance Committee meeting will be April 26th, 2018. Mr. DeSantis asks Mr. Dumas about the Revenue Committee and Mr. Dumas responds that he is looking to start a group with representatives from all the stakeholders to share information and brainstorm new ideas or funding and solve "low hanging fruit" issues. Mr. Dumas states that people looking to start or expand business starts with his office now as a "one stop shop". f5. Board updates (Audit, School Committee, DPW/Public Safety Complex, Downtown Strategy Committee) i nere were no tsoara updates. 6. Items not known within 48 hours None 7. Committee member comments There were no Committee member comments. 8. Adjourn Motion: To adjourn the Finance C ittee Meeting of April 12, 2018 at 8:52 pm. (Feely/DeSantis) Minutes Clerk Signature Minutes Prepared by Mary Dalton TIVIr! Date Date