BOARD OF FINANCE
MINUTES
MARCH 26, 2012
I. CALL TO ORDER
Chairman Thomas Harrison called the Board of Finance meeting to order at 7:00 pm at the Avon Town Hall, Selectman’s Chambers. Members present: Chairman Thomas Harrison, Vice Chairman/Secretary Thomas Gugliotti, Brian Stoll, Catherine Durdan, Margaret Bratton and Dean Hamilton. James Speich was absent. There was the presence of a quorum.
II. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Ms. Durdan.
III. COMMUNICATION FROM THE AUDIENCE
Mr. Stokesbury, BOE liaison, commented that at this time he had no formal report but was available to answer any questions.
IV. MINUTES OF PRECEDING MEETINGS:
February 27, 2012-
Re: Section IV. - Within item #3 change, half way through paragraph, change statement to “ Ms. Bratton questioned when they came up with that number…”
Re: Section VI.- Second paragraph, change statement to, “Mr. Harrison referred to the Freedom of Information Act request they received…”
Re: Section VII.- Fourth paragraph- half way through, change statement to, “(something in non-spendable form like inventory or pre-paid expenses), restricted (restricted by a third party by a grant or a BAN…”.
Fifth paragraph- change statement to, “The total General Fund balance…”
Seventh paragraph- change to GASB.
Re: 11/12-19-First paragraph, change statement to, “The four recommendations are:”
Re: VIII.- Third paragraph, change statement to, “…it is actually a 2.92% increase when it is in the gross.”
On a motion by Mr. Stoll, seconded by Mr. Gugliotti, it was voted:
APPROVED: That the Board of Finance approve the minutes of February 27th, 2012 as amended. Messrs. Harrison, Gugliotti, Stoll, Hamilton and Mmes. Bratton and Durdan voted in favor.
January 23, 2012-
In addition to last month’s revisions, the Board requested the further updates.
Re: Section II.- Add Ms. Bratton to the vote.
Re: Section VI.- Bottom of second paragraph, change statement to, “…states that if the budget is turned down thrice then the Town Council sets the budget…”
On a motion by Ms. Bratton, seconded by Ms. Durdan, it was voted:
APPROVED: That the Board of Finance approve the minutes of January 23, 2012 as re-amended. Messrs. Harrison, Gugliotti, Stoll, Hamilton and Mmes. Bratton and Durdan voted in favor.
V. OLD BUSINESS
11/12-05 Review and Discussion: FY 12/13 Budget Process
Mr. Stoll referred to page B.39 within the FY 12/13-budget book; these are the projections for the 11/12 budget. Mr. Stoll discussed that the detail pages for some of these categories have updated projections, starting on B.51. This also includes an additional column that is not on the projection for 12/13. He also noticed that for most of the categories, the estimate for 11/12 is the same as the budget for 11/12. Mr. Stoll questioned if this all leads us to optimism that we’ll end up ahead of plan. He questioned if they should use the available 9 months of actuals for 11/12 to reflect that in an updated projection for a starting point. Mr. Robertson responded that in terms of a starting point, throughout the year both the revenue projections and the actual revenue received, with the actual amount spent, will both
go up from the starting point. Revenues are estimated way ahead of time. It starts out as a relatively conservative picture but changes as the year goes on leading up to the workshop. Essentially, this exercise is done at the budget workshop. Mr. Stoll referred to pg B.51, licenses, fees and permits. He continued to explain that there is an actual in FY 10/11 of $1,056,000.00. The estimate for 11/12 was $864,000. Currently, the town is at 71% collected, running very hot. If they were to project that, it would equal over a million, an extra $200,000. Looking at pg B.51, you see the other local revenue, where the actual in 10/11 was $737,000, the budget was $460,000 and the projection was $417,000. Since those are considerably different numbers, Mr. Stoll questioned if there is logic in saying what is reasonable. Mr. Robertson responded that here is seasonality to it. At one point you may be down but then suddenly something like dog licenses may come in, where in December we
may be at 10% but then after renewal notices go out it may go up to 70%. Also, some of these revenues are sensitive to the environment such as with development. Mr. Stoll questioned when they will hear the “moment of truth” and Mr. Harrison answered at the workshop. Mr. Stoll also referred to page B.40 and questioned if the grand list of supplemental real estate and motor vehicle estimates are also considered at the April 11th workshop. Ms. Colligan responded that at this point our accessing department files their first list by the end of January and then their final after the Board of Assessment appeals meets the end of March, before the workshop.
Mr. Stoll referred to page B.41 and expressed his difficulty understanding the table on top of the page and the table at the bottom of the page. Ms. Colligan responded that the table at the top of the page might be identified as a delinquent tax collection; these still have a good chance of being collected. The lower table, the estimated uncollectable taxes, is actually a variety of things including the program for volunteer fire department and volunteers that volunteer here but are non- residents. We have reciprocal agreements with Simsbury and Farmington but Farmington’s has lapsed. There are a lot of different variables in there but it is kept pretty conservative. The only thing that has been shifted is tax relief, which gets indexed through the state program. Ms. Bratton questioned if that tax relief was
indexed as a percentage and Mr. Robertson responded that it is indexed to the increase of the mill rate.
Ms. Colligan added that the estimates put in the budget are done in October and the estimated revenues are not usually considered at this point in the budget but it is something that could be discussed for next years budget. Mr. Stoll responded that he feels the best way to get our next years budget is to look at where the current one stands. Mr. Harrison responded that this is a valuable suggestion and recommended the BOF look back at this in the next few months. He questioned if there is more information available on the web and Ms. Colligan responded that there are more details listed on the website including information for every quarter at the close of the quarter.
Mr. Harrison referred to page B.39, under property taxes and assessments, on the right hand side it states there is an increase of 4.74%, but in the beginning of the book the projected mill rate increase says it is a 3.55% increase and questioned why that is. Ms. Colligan referred everyone to page B.50 and explained that the first revenue category, total taxes and assessments, equals the amount on page B.39. The very first line, gross levy, has a 4.71% even though the total for that category is at 4.74% because that line includes a special revenue fund assessment for sewers and it also includes some minor decreases to Lakeview assessments and total fund gross receipts dollar amount. The gross levy of 4.71% includes the growth that we’ve had of approximately 1.12%. It also includes the required adjustment to the levy
to balance the budget as proposed at this point in time, which is at 3.55%- which equals what we are anticipating at this point in time as the tax increase. There is also another small percentage, .04%, which has to do with the mill rate. Right now it is carried out 4 places to balance the budget but it is in flex at this time so after the final numbers are incorporated into the mill rate it is moved to 2 decimal places. When you add all these up it equals the 4.71%.
Ms. Bratton questioned Mr. Stokesbury about the amount mentioned for Special Education at the last BOF meeting and where the $300,000 shortfall came from. Mr. Stokesbury responded that the $300,000 shortfall he gave at last month’s meeting was correct at the time he gave it. Ms. Bratton questioned if this is a different number than the number they came up with in December and Mr. Stokesbury responded that the number he mentioned during the February BOF meeting was the current projected special education out of district average for the current year based on the current years budget as developed in early 2011. The budget adopted in December 2011 is for school year 12/13. The current expected cost has been reduced but he isn’t sure of the exact number at this time and added that it is the most volatile line item
they have.
Mr. Harrison brought everyone’s attention to the handout including the slide show example. The BOF members went through the slideshow handouts and they discussed potential changes and updates to their presentation.
Ms. Bratton questioned Mr. Stokesbury regarding the rooftop units at Roaring Brook and if the amount listed on their requested expenditures covers all of the other units that have not been repaired and Ms. Colligan answered that there are no rooftop units planned in next years budget.
Mr. Gugliotti commented that he feels it seems harmless to discuss the completed slide show through email, regardless of FOI concerns. The BOF agreed and future communication will take place through email.
VI. NEW BUSINESS
11/12-23 Supplemental Appropriation: Sycamore Hills Buildings- Painting and Repairs.
Mr. Harrison mentioned the background information given was very helpful. Mr. Robertson added that this funding would provide necessary enhancements to the recreation areas. Ms. Bratton questioned if this would better the drinking water fountains, as the water that comes out is always hot. Mr. Gugliotti added that it doesn’t look like it will cool the water; it looks like it is only painting.
On a motion by Mr. Gugliotti, seconded by Ms. Bratton, it was voted:
RESOLVED: That the Board of Finance hereby appropriates a sum not to exceed $28,900.00 from Recreation Activities Fund, Other Financing Sources, Undesignated Fund Balance, Account #09-0390-43913 and to Recreation Activities Fund, Parks, Buildings, Account #09-5201-52212, for Building Painting and Repairs at Sycamore Hills.
Messrs. Harrison, Gugliotti, Stoll, Hamilton and Mmes. Bratton and Durdan voted in favor.
VII. TOWN MANAGER’S REPORT
A. Monthly Financial Report Summary
Ms. Colligan presented the monthly report that ends January 31, 2012. We are at 99% of the collection rate. Foreclosure rate is good. Intergovernmental is up slightly, charges for services trending at that same level. Local revenues are weak. There were a lot of unusual one-time revenues in 10/11 that we won’t be getting this FY year. There are no appropriations that have been reported, we are still at 8.8% of budgeted expenditures. The FEMA funding has been coming through for Storm Irene and those supplementals will be coming through for approval. As the BOE presents financials to their governing board they share the material. When reports are given they are posted on the town website.
B. Change in Standard and Poor’s Ratings Methodology
Mr. Robertson brought attention to an article about S&P (Standard & Poor’s) and how there is a change in their ratings methodology. This could be a concern because the town does have some bonds going up for purchase. Mr. Robertson met with Denis Dix, the town’s financial advisory, who met with S&P, and found that their more analytical approach will have some positive and some negative affects on towns but Avon should have no impact at all.
C. Miscellaneous Updates
Mr. Robertson mentioned that he and Mr. Gugliotti met with the health insurance sub-committee for the third time. One outcome was the production of the “white paper” which is basically intended for a primer for elected officials for how the health insurance all fits together. This will be circulating to everyone soon and they will be reporting at the next TC meeting. Mr. Gugliotti commented that one thing he has learned is how difficult it is to take the actual cost of health insurance and to put it into a budget. He learned that basically the town is a self-insurer, meaning that there is a “stop gap”. The town pays up to $120,000 and then insurance kicks in.
VIII. OTHER BUSINESS
There was no other business.
IX. EXECUTIVE SESSION
The Board did not find an Executive Session was necessary.
X. ADJOURN
On a motion by Mr. Gugliotti, seconded by Mr. Stoll, it was voted:
RESOLVED: That the Board of Finance adjourn at 9:04 p.m.
Messrs. Harrison, Gugliotti, Stoll, Hamilton and Mmes. Bratton and Durdan voted in favor.
Respectfully Submitted,
Thomas A. Gugliotti, Vice Chairman/Secretary
Attest: Amber Lansing, Clerk
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