BOARD OF FINANCE
MINUTES
June 26, 2006
I. CALL TO ORDER – Chairman Tom Harrison called the meeting to order at 7:30 p.m. Margaret Bratton, Cathy Durdan, Bill Hooper, Mike Monts and Jim Speich attended. Tom Gugliotti was absent from the meeting.
II. PLEDGE OF ALLETIANCE – Led by Ms. Bratton.
III. COMMUNICATION FROM AUDIENCE – None.
IV. MINUTES OF PRECEDING MEETING: May 10, 2006
On a motion made by Mr. Monts, seconded by Mr. Harrison, it was voted:
RESOLVED: That the Board of Finance accept the minutes of the April 10th Meeting, as submitted.
Mrs. Bratton and Durdan, Messrs Hooper and Months voted in favor. Mr. Speich abstained, he was absent from the meeting.
V. OLD BUSINESS – None.
VI. NEW BUSINESS
05/06-23 – Acceptance of Gifts. Mrs. Bratton pointed out the explanation of the amount of the checks does not agree with the copies of same.
On a motion made by Mr. Harrison, seconded by Mr. Monts, it was voted:
RESOLVED: That the amount listed in the proposed Resolution as ($14,400) should be amended to read $14,600 in accordance with the amount of the checks submitted.
Mrs. Bratton and Durdan and Messrs. Harrison, Hooper and Monts and Speich voted in favor.
On a motion made by Mr. Harrison, seconded by Mrs. Bratton, it was voted:
RESOLVED: That the Board of Finance hereby amends the FY 05/06 Budget by increasing REVENUES Capital Projects Fund (Facil & Equip), Other Local Revenues, Donations, Lighting Town Center, Account #02-0360-43655 in the amount of $14,600 and increasing APPROPRIATIONS Capital Projects Fund (Facil & Equip), Town CIP-Facilities, Lighting Town Center, Account #02-4829-53066 in the amount of $14,600 for the purpose of recording six individual donations for participation in the Town Green Lighting Program.
Mrs. Bratton and Durdan and Messrs. Harrison, Hooper and Monts and Speich voted in favor.
05/06-24 – Review and Discussion: FY 07/08 Budget Presentation, Board of Education Special Education Funds.
Chairman Harrison introduced the issue raised by the Auditors and by the Board of Education how to explain the funding the Board of Education receives from State Grants for Special Education. The Town Manager indicated the auditors have been monitoring the rising level of the supplemental appropriations needed to balance the Board of Education budgets over the past several years. He reported we never know exactly how much it will be, but as you can see, the supplemental appropriation each year is a substantial number. The appropriate thing to do from an accounting budgeting standpoint would be to raise the original budget amount each year until you got closer to the prior year’s actual amount. Even though this is offset by revenues, the Board of Education does not want to include it in their budget
because it will show a substantial percentage increase and would become a highly visible item potentially subject to criticism from the Taxpayer’s Association and others in the community as to why the Board of Education budget is up so high.
In an attempt to look at this from a proper accounting standpoint and also insulate and explain to the public what’s going on, we came up with a possible method which is outlined in the enclosure which shows the Special Education costs as part of Special Revenues. And to be uniform, we did the same thing with the Town side. Of course, you can always put an asterisk on the line item and put a foot-note saying this is increased substantially because the auditor’s want us to more closely mirror the amount of State Grant funding. You can also put an asterisk up at the top because you will have to show it in revenues, too.
The Town Manager answered questions from the Board which ultimately agreed that we have no actual options on this as Special Education is mandated by the State, even though the State does not reimburse 100% of the Special Education costs which means that there will always be a shortage of funding for Special Education. Mr. Harrison questioned in the case of this Board setting a “guideline” of say 5%, he asked which figure would be used as a base for that 5%. The Town Manager indicated that on the chart which shows Board of Education Total at $36,424,390, plus $954,597 in Special Revenues, for a total of $37,378,987, the 5% guideline would be calculated on the total of $37,378,987.
Another way of presenting this is on the advice of the Auditors, they recommend the Board of Education be allowed to have a, let’s say $300,000 increase in the Special Ed Budget that is not included in the increase you give them on the target. You increase revenues $300,000, you increase expenses $300,000, but that $300,000 is not included in the target percentage. Mr. Harrison indicated we could always say that the base that we have been using is less accurate because we were working on the base of a place-holder and that a place-holder has proved to be insufficient in order to recognize the revenues coming from the State because there was a certain amount of “guessing” as to what that amount would be. He feels that would answer the questions.
The Town Manager indicated that consistency in reporting finances year after year is to be applauded. He feels that changing things to accommodate an anomaly and then going back – it begins to raise questions. He reported the auditors and banks and credit people aren’t concerned with the amounts so much, what they are concerned with is consistency of presentation so they can do comparable analysis to determine whether or not your credit rating is still the same, or if you are managing correctly.
Further discussion indicated so long as the Board members are aware of how these funds are used, and can explain it to the public, should the question arise, we should not change our method of presentation of these funds.
VII. MISCELLANEOUS
The Town Manager reported on the renovations to Building 5, 6 and 7 at the Town Hall. The Improvements on Building 7, which were budgeted off and on in varying amounts, between the years 2000 and 2006, (it’s taken 6 years on a cash basis and some years we didn’t do anything), is almost completed. We anticipate moving some people in there within the next several weeks. He reported on the history of completion of the entire complex. We needed to connect buildings 5 & 6 and add Building 7 with a vestibule, stairs and an elevator to meet the ADA act. The project includes in buildings 5 & 6, new carpeting, painting, insulation, etc.; nothing significantly structural. The issue now is that the work on buildings 5, 6 & 7 was scheduled to be started in the summer of the
06/07 year after the Avon High School Project was completed. The AHS project is approximately nine to twelve months behind schedule for a variety of reasons. The Building Official will give a temporary CO for the use of Bldg. 7 for 1 year, if there is work approved and started on the vestibule. If we don’t move on this we won’t be able to start until the Spring of ’07, completion for the end of ’08 in which case the CO will have expired. The Town Council feels it is not wise to wait until the supplemental appropriation for the high school project is complete. They want to get the concrete work in this fall for the elevator, vestibule and stair. They have asked us to move that ahead. The Architect will make a presentation next Thursday evening to the Town Council. Under the Town Charter you do not need a Referendum for items that are 1 mill or less in cost. This point has been included in our
debt planning for a number of years, so we will be leap-frogging some problems such as the Library renovations, the Fire Dept. is looking for a replacement of Company 2, and possibly a training facility. We’ve got water lines beginning to appear on the horizon for the Secret Lake area, we anticipate it will be in the million plus range. If we wait for the High School project, all these projects will be delayed even more. The Town Council will hear a presentation next Thursday evening, they will set up a schedule and a tax impact analysis in preparation for a Town Meeting probably the end of July. If the Town Hall project does not move ahead, then we run the risk of potentially having a finished building that’s vacant, that can’t be used until we get through all these other steps.
The Town Council will approve the project, then it will go to the Board of Finance, upon recommendation it will go to a Town Meeting, we’ll have a presentation just like a 25M project. The only difference is you vote on it at that meeting.
The Chairman voiced his concern about the bonding issues and how they will affect the school. Can you bring us up to date on the School?
The Town Manager reported we finally received approval from the State of Connecticut to go ahead with the project. At the present time, FIP Corp. is soliciting approximately 40 bids. Those bids are due by the 18th and 20th of July; they’ll need a week or so to evaluate the bids and make their recommendations on a bottom line figure. Everybody is anticipating the bids will come in higher than the Referendum of June 2005. There is a schedule of meetings in your packet and we are working to this schedule.
XIII. OTHER BUSINESS – The Town Manager reported that Kevin Witkos has reported that the State has Granted a $150,000 STEAP Grant for a playscape to be erected at the Buckingham subdivision on Huckleberry Hill Road.
IV. ADJOURNMENT\
On a motion made by Mr. Monts, seconded by Mr. Speich, it was voted:
RESOLVED That the Board of Finance adjourn at 8:45 p.m.
Mrs. Bratton and Durdan and Messrs. Harrison, Hooper and Monts and Speich voted in favor.
Respectfully submitted,
Attest: Elinor Burns, Clerk
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