BOARD OF FINANCE
MINUTES
January 28, 2008
I. CALL TO ORDER
Chairman Harrison called the meeting to order at 7:30 p.m. at Countryside Park.~ Members present:~ Margaret Bratton, Catherine Durdan, Tom Gugliotti, Bill Hooper, Jim Speich, Tom Harrison, and Brett Eisenlohr.
II. NOMINATIONS AND ELECTION OF BOARD OF FINANCE CHAIR AND SECRETARY:
Town Clerk Anne Dearstyne officiated.
On a motion by Mr. Speich, seconded by Mr. Gugliotti, it was voted:
RESOLVED: That the Board of Finance elect Tom Harrison as Chairman.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
On a motion by Mr. Harrison, seconded by Mr. Eisenlohr, it was voted:
RESOLVED: That the Board of Finance elect Tom Gugliotti as Secretary.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
III. BOARD OF FINANCE PICTURE FOR ANNUAL REPORT
IV. PLEDGE OF ALLEGIANCE – Led by Margaret Bratton.
V. COMMUNICATION FROM AUDIENCE - None
VI. MINUTES OF PRECEDING MEETING:
December 17, 2007 Minutes
On a motion by Mr. Gugliotti, seconded by Mrs. Durdan, it was voted:
RESOLVED: That the Board of Finance approve the minutes of December 17, 2007.
Messrs. Harrison, Gugliotti, Hooper, Speich, and Mmes. Bratton and Durdan voted in favor.
Mr. Eisenlohr abstained.
Chairman Harrison thanked Sue Burdsall, who is leaving to move out of state, for her excellent work as clerk. She thanked him for the compliment and introduced Alison Sturgeon who will be the new clerk.
VII. OLD BUSINESS
06/07-24 FY 07/08 Budget: Review and Discussion, Board of Education and Town FY 2007-08 Budget Forecasts
Board of Education Chair Peggy Roell went over a handout comparing Avon statistics with those of other towns in the area. It was explained that the CPI (consumer price index) increase over the past five years is just slightly more than the cost per student increase.
There are two main causes for the budget shortfall: the unforeseen number of new students requiring special education moving into the school system; and, secondly, the large increase in the cost of electricity. The Board of Education has had to hire personnel not budgeted for to meet the needs of the new students at a cost of over $300,000.
Mrs. Roell introduced Superintendent Dr. Kisiel who explained further that a budget freeze is implemented usually in March. Due to the tight budget this year, the budget freeze has been in effect since about October when Gary Franzi advised the Board as to the shortfall in the budget. The maintenance fund has been expended already but during the past week two problems arose: the elevator doors at the Middle School need repair at a cost of $4,000 and the bell system at the High School will cost $3,000 to be repaired. Additionally, budget categories such as textbooks have been completely used up and the schools have had to cut into instructional funds. On the plus side, $510,000 should be coming back from the state for the funding of special education students.
Mr. Harrison explained that the Board of Finance would not be able to take a vote to authorize an unspecified amount of money to be taken from Surplus at this time. There is a specific process governed by the Town Charter as to supplemental appropriations. The request must be submitted first to the Town Council. If approved, it will be forwarded with the Town Council’s recommendation to the Board of Finance. The Board of Finance appreciates that the Board of Education is dealing with a tight situation. Mr. Harrison also addressed a question of members of the boards being personally liable for budget shortfalls explaining the state statute that precludes governmental bodies from appropriating funds. The members will not be personally liable because of the practice that at the end
of the fiscal year, there is a reconciliation of accounts that were under-spent and those that were over-spent. It would be after that time that a withdrawal from Surplus could happen.
On a motion by Mr. Gugliotti, seconded by Mr. Hooper, it was voted:
RESOLVED: That the Board of Finance express a sense of the Board, that it will see to it that any good faith overage in the budget expenditures of the Board of Education will, in accordance with law, be covered by necessary expenditure from the Town Surplus.
Mr. Harrison offered an amendment that any request to be subject to proper documentation. It was accepted by Mr. Gugliotti.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
Mr. Harrison thanked Mrs. Roell and those from the Board of Education for their attendance and review. It is understood that it is a difficult budget year now and ahead as well. Mr. Harrison asked that the Board of Education keep the Board of Finance posted on its progress.
07/08-12 Review and Discussion: FY 08/09 Budget
Town Manager Schenck gave a brief review stating that at this point, there are about 7,000 households in Avon and only 4 foreclosures. During the last recession there were quite a few more. The non-property tax revenue is essentially flat. The conveyance tax income, as well as income from interest and building fees is being watched closely. The Grand List is up 1.53% which is slightly higher than the 1.25% forecast earlier. On another positive note, the ECS grant will yield $425,000 to the good, but that is offset by the decline in building fees and other areas. The CRRA money is not included as there is still a suit pending. The $376,000 received thus far is in a separate account. The CRRA is increasing fees from $69 per ton of refuse to $85 per ton. The Town pays
CRRA about $250,000 per year to remove trash from the landfill. At this point in the winter, three fourths of the snow removal budget has been spent. Mr. Schenck explained further that while the Board of Education has a total sum to work with as they see fit, the Town
Council cannot do the same. There are line items and the Council has to come to the Board of Finance if the reconciliation does not take care of overages in some items.
Next spring will be the revaluation of property which may lead to a difficult budget year. The last time there was a revaluation, the budget had to go to a third vote before passing. As the spring progresses, it will be important to keep money in Surplus in anticipation of next year’s potential problems.
VIII. NEW BUSINESS
07/08-10 Supplemental Appropriation: $62,370.94 Insurance Reimbursement, Computer Equipment
There was a lightning strike in September that did substantial damage to the UPS (Uninterruptible Power Supply) system and other computer equipment in the Town Hall. The insurance check for $62,370.94 has been received and it is requested that it be appropriated to the appropriate Town accounts to cover the cost of replacement equipment.
On a motion by Tom Harrison, seconded by Bill Hooper, it was voted:
RESOLVED: That the Board of Finance hereby amends the FY 07/08 Budget by increasing:
REVENUES
General Fund, Other Local Revenues & Reimbursement, Account #01-0360-43612 in the amount of $62,370.94 and increasing
APPROPRIATIONS
General Fund, Information Technology, Service and Consultant, Account #01-1920-52184 in the amount of $23,239.90, General Fund, Admin. Services, Computer Operation, Account #01-2101-52206 in the amount of $39,131.04, for a total of $62,370.94 for the purpose of recording the insurance reimbursement for loss and damage to equipment and associated labor costs as a result of the lightning strikes on September 9, 2007 in the vicinity of the Police Department.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
07/08-11 Supplemental Appropriation: $10,000.00 Insurance Reimbursement, Legal Fees
On a motion by Cathy Durdan, seconded by Margaret Bratton, it was voted:
RESOLVED: That the Board of Finance hereby amends the FY 07/08 Budget by increasing:
REVENUES
General Fund, Other Local Revenues, Refunds and Reimbursements, Account #01-0360-43612 in the amount of $10,000 and increasing
APPROPRIATIONS
General Fund, Legal Services, Legal Fees and Expenses, Account #01-1501-52183 in the amount of $10,000 for the purpose of recording the reimbursement of legal defense for the Newman claim.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
IX. OTHER BUSINESS
At a previous meeting, Mr. Speich commented that items from the Capital Improvement Program (CIP) might be funded in other ways, such as bonding or special funding. He suggested that the Board of Finance might study the impact of perhaps bonding some items to relieve stress on the operating budget. Mr. Harrison suggested to Mr. Schenck that a committee be formed to study this after the budget passes, the committee to include representatives from the various boards and several citizens with financial expertise. Mr. Hooper noted that 12 years ago, Farmington had a lower tax rate because they bonded a lot of items. He cautioned that bonding is not necessarily the answer; Farmington’s tax rate is now as high as Avon’s. He does not want to bond items that can be budgeted for over 2-3
years. Mr. Harrison thinks there should be a discussion about it and that the process would change dept modeling. Mr. Schenck reminded members that the bonding process takes time and costs about $75,000-80,000.
Mr. Eisenlohr asked if anyone had looked into the Clean Energy Fund which offers roofing grants to towns depending on their affluence and need. It might be worth exploring for the roofing projects needed by the schools. He mentioned the Pine Point School in Stonington which has benefited greatly from the fund and innovative roofing materials. The 20% by 2010 resolution was mentioned as well by Mr. Eisenlohr and Mr. Schenck in terms of incorporating more “green” building improvements. He asked if the Avon High School addition was LEED certified; it was not specifically designed according to LEED.
X. ADJOURN
On a motion by Mr. Hooper, seconded by Mr. Harrison, it was voted:
RESOLVED: That the Board of Finance adjourn at 9:05 p.m.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
Respectfully submitted,
Thomas A. Gugliotti, Secretary
Attest: Susan Burdsall, Clerk
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