BOARD OF FINANCE
MINUTES
SPECIAL WORKSHOP
March 31, 2009
I. CALL TO ORDER
Chairman Harrison called the workshop to order at 7:02 p.m. in the Avon Room at the Avon Town Hall. Members present: Margaret Bratton, Catherine Durdan, Thomas Gugliotti, William Hooper, James Speich, Brett Eisenlohr and Tom Harrison.
II. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Chairman Harrison.
III. OLD BUSINESS
08/09-07 FY 09/10 Budget: All Three Boards
Chairman Harrison stated that the Town Charter, in terms of outlining the duties and responsibilities of the Board of Finance regarding the budget process, put several obligations on this Board. The first is to conduct a public hearing, which took place last night. The second is, after that hearing, the Board of Finance is directed to confer with the Town Council and the Board of Education and then make any adjustments in the budget requests that are deemed appropriate. The Board of Finance then recommends a budget that is presented at the Town Meeting. It then goes to referendum in May. Tonight’s meeting is the workshop meeting, with a backup date of April 13th if necessary.
Chairman Harrison will be asking each member of the Board of Finance to share their observations and comments on the budget sessions, as well as the Board of Education and Town Council for their comments or questions.
Regarding additional revenues, Phil Schenck, Town Manager, stated that the Town is going to be sharing, with the Town of Burlington, a number of hours per week of a building inspector. That revenue coming in to the Town of Avon from the Town of Burlington will be $18,200. He stated that the Town Council, in their budget deliberations, has indicated a willingness to increase recreation fees, including fees for the use of the Senior Center Community Room, which will be revenue of $20,000. Also, the Town had a refinement of the notification that the Town received from the Office of Policy and Management at the State on the Local Capital Improvement Programs Grant (LOCIP), which is up $2,136. These additional revenues total $40,336.
Mr. Schenck stated that he may recommend that the Board of Finance reserve a portion of fund balance for the potential chances that the Town’s grants and aid from the State will change, and also to set up a reserve of approximately $200,000 because the Town may have people appealing their new assessments, although it may not be needed.
Chairman Harrison stated that if the Board comes to an agreement regarding this $200,000 reserve fund, he questioned if this would prevent the Board from using surplus as part of resolving the budget situation if they choose to do this. Mr. Schenck stated that the Board could decide to use surplus if they choose.
Chairman Harrison stated that he appreciates all of the work that the Town Council and the Board of Education put into their deliberations. They had many tough choices to make. He stated that these are the lowest budgets that he has ever seen. Chairman Harrison complimented the residents who have made comments and those who attended the public hearing. He stated that residents have a real concern that Avon is facing something different. He also stated that he is conscience of what other Towns are doing regarding their spending requests; many of those Towns are close to a zero spending increase. Chairman Harrison stated that he is considering a zero spending increase for Avon. He stated that the mill rate would increase even at a zero spending increase.
Chairman Harrison stated that he has been against using surplus in the past, but he feels that now they need to use this source. He stated that he does not feel the budget, in its present form, will pass. They saw this happen last year.
Mr. Speich thanked John Carlson and Peggy Roell for their presentations last night. Everyone is well aware of the economic times. He agrees that a 2.98% increase will not pass, although he does not know what that number should be. He stated that he would like to wait to hear what the other members of the Board have to say.
Ms. Durdan stated that she felt the presentations last night were very good with a wealth of information. She stated that last year, when economic times were better, people were looking for an increase under 3%. This year, the economic times are worse. She stated that she has gone through many numbers and she is in favor of a zero percent increase. Also, she would support using $150,000 surplus.
Ms. Bratton stated that she appreciated the detailed presentations last night. She would like to see a zero percent budget increase. Many people have stated their concerns in person and through e-mails, phone calls and blogging. Local businesses are also very concerned. She stated that we, the consumer, are spending less because of the economic times, this affects the local businesses. She stated that initially, she was not in favor of using the surplus, although she would be willing to use $150,000.
Mr. Gugliotti defended Chairman Harrison who would not allow the students to speak at the Town meeting last night, as per the Town Charter. He stated that he is not in favor with changing the numbers at all in the proposed budget. He stated that although he would like to pay less taxes, he has a responsibility to the children in Avon and to the property values in Avon. As an elected public official, he needs to listen to the residents but not be blind to his conscience. Based on the input from the public hearing and e-mails, Mr. Gugliotti stated that his conscience tells him that he would be foolish to take a bare bones budget and cut it. He stated that they need to take into account what is best for the Town overall. He does not want the children of Avon to have fewer
teachers and librarians. He stated that this is not good for Avon. He feels that the property values will go down if the education in Avon changes.
Mr. Hooper thanked the Town Council and the Board of Education for having low budgets, although he does not believe that these proposed budgets will pass. With using a surplus of $156,000, he feels that the increase in spending should be .47%.
Mr. Eisenlohr thanked the Town Council and the Board of Education for their hard work and their great presentations last night. He stated that he supports the budget as proposed. He also stated his concern regarding the health insurance provider and the reduction in costs over the next few years. He questioned if, after passing the budget, the Board would need to figure out how to cover the unplanned expenditures above and beyond what they have already heard about. He stated that the Town needs to have a plan because this is a potential cost. He stated that another concern is unemployment costs. He questioned if there was any cost impact to the budget for the layoffs from the Board of Education and he also questioned whose budget this will impact.
Mr. Schenck stated that the Town does not pay unemployment insurance premiums to the unemployment insurance fund. This is normally a 2%-3% of payroll contributions that businesses would have to make to the State, but as a Municipality, they do not have to make that contribution. He stated that unemployment compensation claims against the Town of Avon could be a factor depending upon the number of layoffs and the amount of compensation that the individuals would qualify for.
The Board of Finance members discussed several spending increases and what the tax increases would be.
Mr. Gugliotti stated that if they reduced the budgets, the members should discuss the reality of laying off more teachers. He asked if the Board of Finance members were willing to accept this.
Chairman Harrison stated that many people in Town are also facing layoffs. He is aware that there may be layoffs, but they need to be aware of people not wanting to pay higher taxes also. He stated that this Board needs to look at the Town as a whole and the total financial picture. Chairman Harrison stated that he would like to get a budget that will pass and he does not feel that the proposed budget will pass.
Ms. Bratton stated that layoffs were not the only option that the Board of Education had. Mark Zacchio, member of the Town Council, stated that the options that the Board of Education had were to cut: certified staff, professional development and athletic programs.
The Board of Finance discussed reducing the spending by ¾ and also by ½ of the proposed budgets. They also discussed numbers that were between the ¾ and ½.
Pam Samul, member of the Town Council, asked the Board of Finance members to consider that during bad economic times, there is an increase demand for their services. She asked that they please not reduce their spending.
On a motion by Mr. Harrison, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance fix the split of budget adjustments as 60% of the reductions to the Board of Education and 40% on the Town side, which will include operating and capital improvement.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr voted in favor. Mmes. Bratton and Durdan voted in opposition.
Prior to voting, Chairman Harrison asked if the Town Council or the Board of Education had any comments or questions.
Peggy Roell stated that if the Board of Finance cuts the budgets, she does not feel that the e-mails and voices of the residents have been heard.
John Carlson stated that he is disturbed by this cut that the Board of Finance might make. He stated that they will have to cut capital projects because they cannot cut the operating budget. By cutting capital projects, they will not go away. He stated that they will see these projects again next year when economic times may not be any better.
On a motion by Mr. Harrison, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance, as required by the Town Charter, adopt a budget recommendation that would call for a spending increase above the current year’s budget of $364,784. Further, that the Board of Finance reduce the Board of Education spending increase by $365,394 and reduce the Town’s operating budget request by $243,596 with the caveat that the Town Council would have authority to allocate that between their operating budget and capital improvements. The Board of Finance authorizes the Town Manager or the Town’s Director of Finance to make whatever rounding adjustments that will be necessary to get the proper number of decimal points for the mill rate. The Board of Finance authorizes the Town Manager to encumber up to $200,000 from the
General Fund, Undesignated Fund Balance to be used as a contingency to cover any potential changes in the grand list following the completion of certain appeals or other reductions in State grants that were built into the budget assumptions.
Messrs. Harrison, Gugliotti, Hooper, Speich and Eisenlohr voted in favor. Mmes. Bratton and Durdan voted in opposition.
IV. NEW BUSINESS
There was none.
V. OTHER BUSINESS
There was none.
VI. ADJOURN
On a motion by Mr. Gugliotti, seconded by Mr. Eisenlohr, it was voted:
RESOLVED: That the Board of Finance adjourn at 9:41 p.m.
Messrs. Harrison, Gugliotti, Hooper, Speich, Eisenlohr and Mmes. Bratton and Durdan voted in favor.
Respectfully submitted,
Thomas A. Gugliotti, Secretary
Attest: Alison Sturgeon, Clerk
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