BOARD OF FINANCE
MINUTES
JULY 25, 2005
I. CALL TO ORDER - The Regular meeting was called to order at 7:30 p.m. by Chairman Tom Harrison, in the Selectmen’s Chamber, Town Hall. Present were Messrs. Gugliotti, Hooper, Monts, Zacchio and Ms. Durdan. Mr. Speich was absent.
II. PLEDGE OF ALLEGIANCE - Led by Mr. Gugliotti.
III. COMMUNICATION FROM AUDIENCE - None.
IV. MINUTES OF PRECEDING MEETING - May 23, 2005
On a motion made by Mr. Gugliotti, seconded by Ms. Durdan, it was voted:
RESOLVED: That the Board of Finance accept the minutes of the May 23, 2005
as submitted.
Messrs. Harrison, Gugliotti, Hooper, Monts, Zacchio and Ms. Durdan voted in favor.
V. OLD BUSINESS - None.
VI. NEW BUSINESS
05/06-01 - Review & Discussion: 06/07 Budget Process
A. Report Budget Information Committee
Mr. Harrison reported that he wanted to discuss the budget process for the next fiscal year. He feels the Operating Budget, the annual budget, and the High School Referendum were all quite successful and he’d like to feel that this Board had something to do with that. There are three areas he would like to talk about - the proposal from Tom Mortimer, do we want to set targets again this year, and a report on the Budget sub-committee from Mike Monts, Cathy Durdan and Jim Speich.
Mr. Mortimer has submitted his proposal on alternate ways to develop a budget. He is proposing that when we look at spending targets we should focus on the CPI as a guide. His thinking was that it makes more sense over the long term to focus on a target for spending rather than a tax increase, Using the CPI as a base, either national or local, because it should be something that is visible. It should be something that people could find in the local newspaper. On the Town’s side it would be based on the number of households, and on the Board of Education’s side based on the number of students. For new mandates, on either side of the budget, they would not be included in that year’s spending, but would be included in the subsequent years. Mr. Mortimer offered to
present this concept to the various boards in an effort to make them comfortable with this method of determining a fair and equitable tax rate. Comparing the figures on the chart, you can see that compared with previous years, this method just about perfectly matches what we recommended and which was accepted by the taxpayers. The Town Manager has asked some very good questions - how do we deal with human natured people who don’t always care about the CPI, they want to know how much are my taxes going up.
Copies of Mr. Mortimer’s chart were distributed. The Town Manager agrees with Mr. Mortimer’s point of focusing on spending, not on the tax increase, if the goal is to reduce spending, not necessarily the tax rate; if you keep spending down, you will keep taxes down. However, his concern is that he is not sure how realistic this concept is in developing the Town‘s Budget.
The CPI was set in 1984 at a standard of 100, and has grown since then. Mr. Hooper questioned whether this base considered such items as energy, transportation, contractual obligations, etc. What items were used to arrive at the inflation rate which was used. Mr. Mortimer believes people will be comfortable with the total, regardless of what the tax increase is and he feels something like this should be formally adopted by all three boards.
Mr. Gugliotti feels this is a great tool, but he doesn’t see this as anything more than any other tool we use. He looks at the chart and feels pretty good that the last couple of years our figures were right on track with what the chart shows. He is reluctant to say that we commit to a program that will tell us what we should do this year, next year and so forth.
Mr. Harrison agrees and points out that we have a Town Charter which dictates that “the Board of Finance shall make such adjustments, after the Public Hearing, as it deems appropriate”. If the formula works beautifully at the Public Hearing, the voters say they don’t care what we did - it’s too much, or it’s not enough?
Mr. Zacchio feels this is a good tool to use as we look at targets, but he feels the Board’s obligation is to look at contractual obligations first because they are known expenses, then decide, together, what we think a manageable target would be. It was noted that if we follow Mr. Mortimer’s thinking then we don’t need a Board of Finance or a Referendum. Mr. Monts and Ms. Durdan agree that the method recommended by Mr. Mortimer is helpful, but would not recommend setting a target for this year.
The Board unanimously agreed that this report is an excellent tool, but they are not comfortable formally adopting such a method to develop a budget number. The Board expressed its appreciation for the efforts of Mr. Mortimer. It was also agreed that the Board should set a target number for spending, as we did last year, leaving this Board the flexibility to make changes, as necessary, until it’s recommended budget is submitted to Referendum. On the suggestion of the Town Manager, Mr. Harrison requested that the November agenda contain an item to set a target for the Town Council and the Board of Education, to be used when developing their budgets.
In regard to the Budget Cover, Mr. Monts reported a Committee of Ms. Durdan, Mr. Speich and Mr. Monts were in agreement that the Budget Cover Sheet, developed for last year’s consideration is a valuable tool for the Board’s use in determining justification for some increases. They realize it was a lot of work on the part of the staff but feel that updating the information and streamlining the format should not be onerous for this year.
It is the opinion of the sub-committee that this be discussed further and then be referred to the Town Manager for his consideration. The Committee also feels it would be helpful if the Budget could be presented in a condensed form - this 200 page document is a lot for the average person to absorb. The Town Manager reported this is being considered as the GFOA and other accounting groups are leaning in the direction of condensing information. He explained the large volume is used for many purposes and will still be necessary as a working document and will continue to be developed, and from that a shortened, abbreviated form could be prepared for publication.
VII. MISCELLANEOUS - Tom Gugliotti reported he wants the members of this board to look at a copy of the report of the Facilities Maintenance study Committee. He indicated that this is a “feel good” report; he had the privilege to serve with John Carlson, Dick Kisiel, Phil, Mike Miller, Bruce Williams and Dean Dorman. Back in 1998 there was a facilities study done - there was a hue and cry in Town about the schools and their condition. That group came up with many recommendations to improve maintenance of the schools and this has been done diligently, largely due to Dr. Kisiel’s guidance. He reported that today it is remarkable what wonderful care this Town has given the schools. It’s
evident that more attention is being paid. Members of the Board of Education and the Town Council reported that admittedly more money is being spent on it. Some viable suggestions in the new report are for more cost sharing and cost combining, what things are common to both sides. There is reference to other towns involved, notably the Town of Madison. We are looking at their system of facilities maintenance.
VIII OTHER BUSINESS
IX. ADJOURN
On a motion made by Mr. Gugliotti, seconded by Mr. Zacchio, it was voted:
RESOLVED: That the Board of Finance adjourn at 8:25 p.m.
Messrs. Harrison, Gugliotti, Hooper, Monts, Zacchio and Ms. Durdan voted in favor.
Respectfully submitted,
Thomas A.Gugliotti, Secretary
Attest: Elinor Burns, Clerk
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