BOARD OF FINANCE
MINUTES
REGULAR MEETING
March 23, 2009
I. CALL TO ORDER
Chairman Harrison called the meeting to order at 7:33 p.m. in the Selectmen’s Chamber at the Avon Town Hall. Members present: Margaret Bratton, Catherine Durdan, Thomas Gugliotti, William Hooper, and Tom Harrison.
II. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Ms. Durdan.
Chairman Harrison stated that he would like the agenda to be amended in order for the auditors to make their presentation first. He asked that Item VI. be next on the agenda; the Board agreed.
III. NEW BUSINESS
08/09-11 Review, Discussion and Acceptance: FY 07/08 Audit
Ms. Colligan, Director of Finance, introduced Charles Lucas, Town Accountant and Stacy Nobitz and Vanessa Rossitto from BlumShapiro.
Ms. Rossitto stated that they have given the Town a clean opinion on their financial statements. She discussed the Statement of Net Assets, including the assets, noncurrent assets, liabilities and net assets. The Town invested $100,992,393 in capital assets and $12,623,398 in unrestricted.
Regarding the Town’s Statement of Activities, Ms. Rossitto stated that this is organized in a way where the expenses are shown first by function; revenues are subtracted from that function to come to a net revenue and expense for each function. She stated that net assets have increased by $10.2 million.
Regarding the major funds in Avon, Ms. Rossitto stated that the general fund has a fund balance of $4.6 million; CIFA has a fund balance of negative $22 million; and the sewer fund has a fund balance of $2.2 million.
Regarding the Statement of Revenues, Expenditures and Changes in Fund Balance, Ms. Rossitto stated that revenues were $32,000 greater than budgeted; expenditures were $613,000 less than budgeted; and other financing sources were $313,000 less than budgeted. The total was $959,000 increased to Budgetary Fund Balance.
Chairman Harrison asked Ms. Rossitto if there was anything in these numbers that raised any flags in her opinion. Ms. Rossitto stated that, in her opinion, no flags were raised.
Regarding the Statement of Fiduciary Funds, Ms. Rossitto stated that the pension fund had assets of $22.7 million as of June 30th, which is a decrease from the prior year. She stated that agency funds had assets of approximately $200,000.
Ms. Rossitto stated that they had to reclassify the post employment benefits fund from a trust fund to a special revenue fund. This year, the Town will have to implement GAZB Statement 45; they will have to recognize the liability for assets. Mr. Schenck, Town Manager, stated that the Town Council is aware of the need to reserve funds for OPEB, which the Town has been doing. From a budgetary standpoint, contributions were decreased due to the fact that there was a substantial increase in the pension obligation. There is very little money budgeted in the forthcoming budget for this. Mr. Schenck stated that, long term, they need to look at the Town’s, as well as the Board of Education’s contribution that was previously not identified in the evaluation until this
past year.
Ms. Rossitto suggested that they split the Board of Education and the Town pieces; an OPEB liability for the Board of Education’s portion and an asset for the Town’s portion. Ms. Colligan stated that she has talked to Gary Franzi regarding this issue; they do not intend to pre-fund the liability. Mr. Schenck stated that Moody’s and S&P will be looking at the Town to see what measures the Town has taken to take care of this liability; it needs to be funded like a pension.
Mr. Nobitz stated that both reports, the State and Federal Single Audit Reports, issued clean opinions. In the management letter, there were two IT related issues. The first was the limited information systems policies and procedures regarding password protection. Their recommendation is to develop technology and operational policies and procedures. The second issue was regarding a disaster recovery plan. Their recommendation was to develop and test a comprehensive disaster recovery plan. Ms. Colligan stated that the first issue has been successfully completed. The second issue will be brought up at the next IT meeting. They will need to decide if the Town should create a Disaster Recovery Plan on their own or to piggyback on CRCOG.
On a motion by Mr. Hooper, seconded by Ms. Bratton, it was voted:
RESOLVED: That the Board of Finance accepts the FY 07/08 audit report as presented.
Messrs. Harrison, Gugliotti, Hooper, and Mmes. Bratton and Durdan voted in favor.
08/09-12 Appoint Auditor: FY 08/09
Chairman Harrison questioned if it was Ms. Colligan’s recommendation that BlumShapiro be appointed as auditor. Ms. Colligan stated that it was her recommendation.
On a motion by Ms. Bratton, seconded by Ms. Durdan, it was voted:
RESOLVED; That the Board of Finance approves the retention of BlumShapiro as auditor for the Town of Avon for FY 08/09.
Messrs. Harrison, Gugliotti, Hooper, and Mmes. Bratton and Durdan voted in favor.
IV. COMMUNICATION
Charles Lucas stated that BlumShapiro was very hard on the Town during the first few years, although their relationship has gotten better. He stated that the auditor’s had timeframes that were not easy to meet by the Town. Ms. Colligan stated that they now give the auditors an Excel file earlier on so they can troubleshoot it off-site and come back with exceptions, which has helped.
Mr. Gugliotti stated that these were interesting comments and he feels that the Board should consider them next year. Ms. Robinson stated that if the Town were to go out for an RFP, this should be decided in January in order to have enough time to go through the process. Ms. Colligan suggested having an initial conversation in November or December.
V. MINUTES OF PRECEDING MEETINGS: February 23, 2009
On a motion by Ms. Durdan, seconded by Mr. Gugliotti, it was voted:
RESOLVED: That the Board of Finance approve the minutes of February 23, 2009 as written.
Messrs. Harrison, Hooper, Gugliotti and Mmes. Bratton and Durdan voted in favor.
VI. OLD BUSINESS
08/09-07 Review and Discussion: FY 09/10 Budget
Chairman Harrison stated that there is an Avon Budget Blog, which has many interesting comments on it. He believes that people may raise questions regarding what other surrounding Towns are doing and why they are cutting their budgets but Avon is not.
Ms. Bratton stated that, in general, people are saying that if there was ever a year to have a zero increase in the budget, that this would be that year. She stated that small businesses are also concerned.
Chairman Harrison stated that he has sent an e-mail to Boards of Finance in surrounding Towns. He has heard back from Barkhamsted and Simsbury. Barkhamsted’s combined budget request, which is the same as Avon’s, has a total spending decrease of $36,000 or 0.37%; Simsbury has a $54,000 spending increase or 0.06%. He stated that Avon is requesting a 1.38% increase, which is the lowest they have ever had.
In response to a statement that the public feels that Avon does not do enough to get information out, Mr. Gugliotti stated that all statutory requirements are always met; the Town is doing what is legally required. He also feels that people have a responsibility to find that information. Mr. Schenck stated that they are looking at expanding and getting more information out through the Town (i.e. CATV cameras). Ms. Robinson stated that they did get information out onto the Town’s website.
Regarding the presentation for the public hearing, Chairman Harrison stated that he does not only want to cite numbers, he also would like to focus on where the Town gets those numbers. He stated that he will circulate the final draft of the presentation to Board members. He asked that they submit their comments as quickly as possible.
VII. OTHER BUSINESS / TOWN MANAGER’S REPORT
Misc. A. Rules for Referendum Materials: Blythe Robinson
Ms. Robinson stated that the Town has looked at what could be presented to the public at Special Town Meetings and what approvals would be necessary. She stated that a PowerPoint presentation can be used, as well as information on a website. She stated that when taxpayer dollars are spent to print information, this is when approvals are needed. The law is clear that when there is a triggering event, in this case when the Board of Finance sets the amount of the budget that will be recommended, this is when any printed material, explanatory text, needs to be approved by the Town Council and then by the Town Attorney. Ms. Robinson stated that she has prepared a resolution for the Town Council on their April 2nd agenda to authorize the use of explanatory text; this is a
blanket statement.
Mr. Schenck questioned if the Board of Finance would like to have public comment on their March 31st Workshop agenda. There was a consensus of the Board members not to allow public comment at this meeting.
VIII. EXECUTIVE SESSION
On a motion by Ms. Bratton, seconded by Ms. Durdan, it was voted:
RESOLVED: That the Board of Finance go into Executive Session at 8:48 p.m.
Messrs. Harrison, Gugliotti, Hooper, and Mmes. Bratton and Durdan voted in favor.
On a motion by Ms. Durdan, seconded by Ms. Bratton, it was voted:
RESOLVED: That the Board of Finance come out of Executive Session at 9:38 p.m.
Messrs. Harrison, Gugliotti, Hooper, and Mmes. Bratton and Durdan voted in favor.
IX. ADJOURN
On a motion by Mr. Gugliotti, seconded by Mr. Hooper, it was voted:
RESOLVED: That the Board of Finance adjourn at 9:39 p.m.
Messrs. Harrison, Gugliotti and Hooper, and Mmes. Bratton and Durdan voted in favor.
Respectfully submitted,
Thomas A. Gugliotti, Secretary
Attest: Alison Sturgeon, Clerk
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