BOARD OF FINANCE
MINUTES
September 27, 2004
1. CALL TO ORDER – The Regular Meeting was called to order at 7:30 P.M. by Chairman Tom Harrison. Members present: Cathy Durdan, Tom Gugliotti, Bill Hooper, Mike Monts and Jim Speich. Mark Zacchio was absent.
II. PLEDGE OF ALLEGIANCE – Mr. Speich led the assembly in the Pledge.
III. COMMUNICATION FROM AUDIENCE – The Chairman introduced Seniors from Avon High School, George, Mike, Chris, Craig, all from the civics class.
IV. MINUTES OF PRECEDING MEETING – August 23, 2004
On a motion made by Mr. Gugliotti, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance accept the Minutes of the August 23rd meeting, as submmitted.
Messrs, Harrison, Gugliotti, Hooper, Monts, Speich and Mrs. Durdan voted in favor.
V. OLD BUSINESS – Review & Discussion: FY05/06 Budget – The Chairman reviewed past discussions for setting a non-binding target for the budgets; all agreed that something along these lines would be helpful but the board decided we did not want to set this target using the CIP or some other index that would not particularly relate to Avon and its issues. We discussed reviewing trends in Avon that were approved at referendum in terms of dollar and percentage increases. Staff has put together some very impressive charts in terms of the increases requested by each of the Boards, what this Board’s initial recommendations were and then what the voters ultimately approved in terms of dollars
and percentages. The Chairman reported he leans toward looking at dollars and percentages in spending. Also he feels there is a strong sense that we not set a “one size fits all”, perhaps we should set one target for the Board of Ed and a separate target for the Town Council. The charts show three categories for the Town – Town Operating Budget, Capital Improvement Program and Debt Service but we should probably exclude the Debt Service because it’s not really in the discretion of the Town Council.
Mr. Gugliotti reported he has a problem trying to allocate between the Town and the Board of Ed. When we have a total figure to present to the Town, he may be better equipped to deal with those numbers to perhaps come up to a disparate allocation for the Town and Board of Ed, but at this time he is finding it hard to come up with a number. Mr. Hooper asked if both Boards come in as requested, does that mean it is the number we send to Referendum? Do we still have work to do? The Chairman indicated we would then have to consider the results of the Public Hearing. The Town Manager indicated that if you use an equitable process to determine the Board of Ed’s target, you should use the same process for the Town. If you are taking a 3 year average with their operating budget, it
comes out 6.01%; if you take a three year average of just the Town Operating Budget, you’re looking at 4.96%, not 4.5%. If you want, he can do the average for 3 years on the Town and CIP budgets added together, but whatever the components are, they should be equal. If you look at the Town and CIP, it comes out to 4.09%, he’d like to leave it at 4.5% - next year’s Capital Budget will include the new roof for Pine Grove School. The Town would be penalized because we have the school roof in there. Mr. Hooper would like to leave the Capital Improvement Program alone. Maybe we should make it a tad lower – 5.5 % to 4.5%.
Mr. Harrison indicated he would be willing to make a motion on a split of 5.5% for the Board of Education and 4.5% for the Town Council and he reported he would put together the wording in a letter to explain the actions of the Board of Finance to the Town Council and the Board of Education.
On a motion made by Mr. Harrison, seconded by Mr. Hooper that:
RESOLVED: That the Board of Finance set a target of a 5.5% increase in
spending dollars for the Board of Education Operating Budget
and a 4.5% increase in spending dollars for the Town
Operating budget, not including the Capitol Improvement
Program.
Messrs. Harrison, Hooper, Monts, Speich and Mrs. Durdan voted in favor. Mr. Gugliotti voted against.
VI. NEW BUSINESS –
04/05-03 Supplemental Appropriation: $4,000 –
Intergovernmental Law Enforcement Block Grant.
The Town Manager replied to a question by Mr. Gugliotti, that only the Towns that have local Police Departments qualify for this Grant. Small Towns that have resident State Police and large Cities receive Grants from other sources. That explains why we are “1 of 69 towns to qualify for this grant”.
On a motion made by Mr. Gugliotti, seconded by Mrs. Durdan, it was voted:
RESOLVED: That the Board of Finance hereby amends the FY04/05 Budget
by increasing REVENUES General Fund, Intergovernmental,
Law Enforcement Block Grant, Account #01-0330-43373 in the
Amount of $4,000, and increasing APPROPRIATIONS
General Fund, Administrative Services, Other Equipment
Account #01-2101-53319 In the amount of $4,000 for the
Purpose of purchasing one network printer and one
Replacement computer system.
Messrs. Harrison, Gugliotti, Hooper, Monts, Speich and Mrs. Durdan voted in
favor.
04/05-04 Review, Discussion & Approval: Auditor Selection
Process.
Margaret Colligan, Director of Finance, submitted a brief overview by GFOA, a summary document, to get you thinking about how to select an Auditor for the Town. She also submitted a list of questions that need to be answered to help her pull the RFP together which she would like to present to the next meeting. The time frame is determined by several factors; the time involved for interested firms to respond to the RFP and also in consideration of our budget preparation schedule.
In response to a question from the Chairman, Ms. Colligan reported a 3-year contract with 2 one-year extensions was proposed last time; after that we just extended the contract for two more years. She replied to Mr. Monts that there are termination rights that are built in other than for cause. The Board of Finance concurred that the same term of engagement be proposed. Copies of the contract for your review will be available at the next meeting.
Mr. Gugliotti questioned the make-up of the Audit Committee. Ms. Colligan replied there are other ways to make up a Committee, but Avon has indicated the “Board of Finance” shall be the Audit Committee, working with staff to develop the selection of an Auditor. Mr. Schenck reported that in the past members of the Board of Finance asked a member of the Board of Ed, the Director of Finance and the Town Manager to participate in the interview process to ask questions from the standpoint of the Town’s staff. The Committee as a whole worked it down to three firms that would be qualified; there are only about 5 or 6 firms in the State that specialize in municipal auditing so it’s more than likely that we will hear from those firms and not too many others.
The question of whether or not the current auditor should be asked to submit a new proposal was discussed in detail. Although the current auditor has done a fine job for the Town, it was the general consensus that following the State’s guidelines, the Town of Avon graciously thank the current firm but say that because of the GFOA suggestion we preclude them from the process. It was the consensus of the Board of Finance that Kostin-Ruffkess not be invited to make a proposal.
A pre-proposal conference will be scheduled to make prior year’s audit reports and management letters available to interested firms. Ms. Colligan reported this pre-proposal conference can be held during normal business hours and it will not be necessary for the full Board of Finance to attend. When the RFP is issued, it invites an opportunity for interested firms to attend a pre-proposal conference; we’re not making it mandatory but it does give the firms that have not worked with Avon before to review prior audits. We will then give them 30 days to submit a proposal, if they so desire.
Ms. Colligan asked while reviewing RFP’s initially, if you have questions for the firms, how should they be handled? Mr. Gugliotti suggested we e-mail any questions to Ms. Colligan, she can then see that each of us has a copy of all the questions. After the Board has made their evaluations, it will be necessary to meet and discuss them – it will be a scoring, or rating system that staff will come up with …. This will need to be done by the beginning of April – she is allowing for three weeks in March for the evaluation process by the Committee. Mr. Harrison indicated he could work with that schedule, and the Committee agreed. Ms. Colligan reported if you e-mail your evaluations to the staff, they could rate them and send the composite scores back to you. We
can then arrange to interview the top firms. In response to a question from Mr. Monts, Ms. Colligan reported last time, the proposals were rated on best overall value of indicators – she reported we weighted the technical side more than price alone so last time it was about a 70/30 split. Price alone was 30% of the totals, 70% was for technical expertise based on evaluation criteria.
It was the consensus of the Board to have staff evaluate the responses and arrange for the top firms to be interviewed. A “Proposed time Requirements For Selection of Audit Firm for FY2004-2005 Audit”, as submitted to the Board, is attached and made a part of these minutes.
VII. EXECUTIVE SESSION - The Chairman advised that since Mr. Zacchio is not here, we will not have an Executive Session tonight.
VIII. MISCELLANEOUS – The Town Manager reported on a letter from Dennis Dix along with tables he requested to provide a two-year look at how we were faring with other AAA bond communities. If the Board analyzes the tables, I think it will see that little has changed and what little has changed has changed for the better. I will provide a six-year review of where we stood when we first started our triple A, to where we are now, compared to our peer group for your review at a future meeting.
The Board of Ed has submitted their year-end financial statements; they have included as a supplemental appropriation, something that has not reached you yet. It will be going to the Town Council next week on their agenda, and that’s a request for the pre-paid Federal Grants that you usually see each year. I think it’s around $479,000. That’s already included in here.
The Chairman asked about closing out the Thompson Brook School account … He responded they actually have one more meeting on the floor so hopefully we will get that closed out before the end of the year here. There is $30,000 the playground people have requested and it is rumored that they need another $10,000 or $15,000, but we haven’t seen anything in writing. We still have retainage in there for the contractors which has to be calculated – I can give you a better answer at the next meeting.
IX. OTHER BUSINESS – Mr. Harrison called on Linda Merlin who was in the audience – she asked a question about the split on the target – the Chairman explained.
Mr. Hooper asked if every Town has an advisor like Mr. Dix? The Town Manager responded that most do and this does go out to bid from time to time; the last time was probably eight or ten years ago. Actually it was about two years before we got the AAA rating. We will probably go out again before we go out to bond the next time.
X. ADJOURN
On a motion made by Mr. Gugliotti, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance adjourn at 8:50 P.M.
Messrs. Harrison, Gugliotti, Hooper, Monts, Speich and Ms. Durdan voted in favor.
Respectfully submitted
Thomas A. Gugliotti, Secretary
Attest: Elinor Burns, Clerk
09-27 B.O.F Minutes
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