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BOARD OF FINANCE – WORKSHOP
MINUTES – MAY 17, 2004
I. CALL TO ORDER – Chairman Tom Harrison called the meeting to order at 7:00 p.m. Present were members Tom Gugliotti, Bill Hooper, Steve McGuff, Mike Monts, Jim Speich and Mark Zacchio.
II. OLD BUSINESS – Mr. Harrison reported on the procedure of business to be conducted as a result to the May 28, 2004 defeat of the budget Referendum. The Town Charter provides that the Board of Finance shall meet with Town Council and the Board of Education. After that consultation, whatever adjustments we believe are appropriate, we take those revisions to a Public Hearing which will be held a week from tomorrow, May 28, 2004 at 7:00 p.m. at the Senior Center. That’s a full blown hearing, it’s not like the Public Hearing. We have scheduled a final workshop on the morning of May 27th, 8:00 a.m. There is
no public comment on that, we will then finalize our recommendation to go to the second Referendum. That number can be more or less than our deliberations at the Public Hearing. Hopefully we can go to a final Referendum on June 7, 2004.
FY 2004/2005 – The Chairman asked for the opinions of the Board members on their thoughts on how to arrive at an acceptable budget. Mr. Harrison indicated we are not going to consider Revaluation, that is history. We are not going to talk about that tonight. We do have some additional revenues; the State Budget was enacted since we last met and they have been approved. We have realized some considerable cost savings by going out to the market place. We will still have to make more reductions. The Chairman feels we have to get the tax increase attributable to the budget. The 5.5% budget increase in addition to the 3.5% attributable to Revaluation is just too high. He feels we have to get a figure that starts with a 3, maybe 3.5% before it can have a chance of
approval. He has heard some people want to defeat the budget to send a message. However, he reported every time we hold a budget it will cost the Town between $3,000 and $4,000 to run a referendum; we will have to incur that on June 7th. Also, things like payroll, medical, etc. bills cannot be paid until a budget is approved and tax bills cannot be sent out until a budget is approved. July is usually the month that all of the real estate taxes come in, all the personal property taxes come in as well as all the sewer taxes that are levied.
He feels that on top of the 3.5% increase due to revaluation, he is looking for 3.7% increase in taxes or a total tax rate of 23.6 mills. However, this will leave a short fall of $890,000. We will have additional revenues of $167,000 as a result of the State Budget being approved There are also some cost savings because of renegotiated health benefits of about $180,000. In terms of Town expenditures, I’d like to see about a total of $89,000 to $92,000 from the Town. 50% of that amount will come from renegotiating the health care contract. We will also be reducing the Town’s portion by an additional $50,000 to be used as the Council sees fit. The Board of Education received $130,000 from the health care savings leaving $500,000 which we would reduce from the
Board of Education’s request which was defeated at referendum last week. This would be a reduction of $500,000 plus the $130,000 for a total $630,000 from the Board of Educations budget. Those two amounts combined with $166,000 from the State Budget would get us to the $888,658. Debt Service would be untouched – it would have an increase of 3.39%. The Sewer Budget would again be untouched – it would go up 24.71% The Town Operating Budget would go up 4.49%; the Capitol Budget, unless the Council makes some changes, they had decreased that by 0.75 %. The Board of Education’s budget factoring in the $500,000 reduction and $130,000, is 4.94%. Combined spending from all sources is $56,451,311. This would result in a tax increase of about 3.64% which will be higher than some approve, and lower than some others will approve.
In response to the Board, the Town Manager reported on some of the sources for the additional revenues. He reported some of funds come from a portion of the slot machine revenue that is allocated to municipalities on a state wide basis, about $85,900. $438 is a reduction in funds we send to the State. TAR stands for Town Aid Road grant that’s to be used for sand, salt, paving, etc. $37,659. PILOT stands for Payment In Lieu of Taxes and this covers exempt property, State owned, colleges, hospitals, prisons, etc. and also non-profit organizations, churches, universities, that sort of thing. The Town of Avon gets a stipend of $5,504 up for the Horse Guard Property and certain pieces of open space property. LOCIP stands for Local Capital Improvement Programs, Fund #11, we
get about $90,000, up about $1,320. ECS stands for Educational Cost Sharing, the large state-wide education grant, it’s needs based, we’re now up to about $120,021 increase over $700,000. School Transportation is up $1,362. Adult education is up $200. Generally we run an independent adult program. We usually piggy-back Farmington and some other communities. That adds up to $166,102.
The Chairman asked Board members for their thoughts. Mr. Hooper reported he is right along the same lines as the Chairman; within $10,000 of every number you mentioned. Unless the Council or Board of Ed has a compelling reason, I’m right with the Chairman.
Mr. Monts is in agreement with the Chairman on voting levels and turn-out. He was right that the information available was the best ever. He also agrees the feeling from the vote was a reduction of the levy. He agrees with a level below 4%, but instead if 3,6% he is looking at 3.8%. He would look at the amount that needs to be reduced and apply a ratio of 60% to the Board of Education and 40% to the Town.
Mr. Gugliotti has very little to add. This is a difficult year that has been exacerbated by revaluation. He is in line with the comments made by the Chairman. He is in line with the Chairman’s recommendations.
Mr. Zacchio reported he is in agreement with the dollars and cents; he applied the $166,110, the $130,000 and the $50,000 to each of the budgets. He was at 3.75% on the high side and 3.64% on the low. His low side is a reduction of $166,110, $130.000 and $50,000 respectively to each of the budgets, and a split of $478,000 to the Board of Ed and $65,000 to the Town.
Mr. McGuff believes we have to consider three years of growth for the town. He feels we need $671,000 - $75,000 from the Town of which $50,000 comes from the health care savings; and $480,000 from the Board of Ed of which $130,000 is from health contracts. Grant money is probably $166.110. Overall that puts my numbers at a 4.8% overall increase.
Mr. Speich is in agreement with the numbers. However, he is grateful for the additional revenues, the conveyance tax and state grants. He tried to look for ways to reduce the Capital program, but that was very difficult. The Town Budget is very difficult to reduce. His number is about a 5% increase.
Mr. Zacchio indicated he is looking at $65,000 net from the Town Council, $478,000 net from the Board of Education. He feels this produces a number that will be acceptable to the voters.
On a motion made by Mr. Hooper, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance propose further adjustments to the proposed budgets of $166,110 in additional revenues, $42,000 net reductions from the Town Council and $500,000 net reductions from the Board of Education for a total of $672,000 resulting in a net tax increase of 3.64% and a proposed mill rate of 23.63.
Messrs. Harrison, Gugliotti, Hooper, and Speich voted in favor. Messrs. McGuff, Monts and Zacchio voted in favor.
The Chairman opened the meeting to comments and questions from the audience. Several residents spoke of their concerns, asked various questions, and thanked the Boards for their efforts.
III. OTHER BUSINESS – None.
IV. ADJOURN
Respectfully submitted,
Thomas A. Gugliotti, Secretary
Attest: Elinor Burns, Clerk
05-17-04 BOF
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