BOARD OF FINANCE
MINUTES
MONDAY, JUNE 25, 2012
I. CALL TO ORDER
Chairman Thomas Harrison called the Board of Finance meeting to order at 7:01 PM at the Avon Town Hall. Members present: Chairman Thomas Harrison, Vice Chairman / Secretary Thomas Gugliotti, Margaret Bratton, Catherine Durdan, Dean Hamilton, James Speich and Brian Stoll. There was the presence of a quorum.
II. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Dean Hamilton.
III. COMMUNICATION FROM THE AUDIENCE:
Mr. Bill Stokesbury, BOE Liaison, stated that like the Town, the BOE is in the process of closing out their current year budget. It is going smoothly.
The accounting software conversion is well underway and the purchasing module will start, full scale, on July 1, 2012. He believes that better monthly reports are being provided, and that will only continue as more of the software package is implemented. He reported that they are building a new facilities report that will present data on what the BOE is doing with each of our buildings on a yearly basis, one step down from capital budget items. It shows what inspections are done on an annual basis, what monies are spent from the operating budgets toward facilities management, all to give a better flavor of how much money goes into the infrastructure.
Contract negotiations are in progress with the custodians. The teachers’ contract negotiations officially kicks off July 1, 2012. There is a subcommittee strategy meeting planned for July 9th, Tom Gugliotti as our liaison will be attending. We hope to have the first negotiating session on July 25th, subject to final agreement.
IV. MINUTES OF PRECEDING MEETINGS:
Tom Gugliotti questioned the format of the public hearing meeting minutes. He raised the question of whether the minutes needed to be in transcript form or standard summary form. He asked if the tapes were kept for any period of time. Brandon Robertson stated the answer was affirmative; the tapes are kept for a minimum of 2 years. They are not destroyed until after the town writes to the state and receives permission to destroy them. Mr. Harrison stated that he doesn't’ disagree, however, unlike our regular meetings where there is not a need for transcript like minutes, it is a public hearing where similar to when the legislature or congressional committees hold hearings they do keep a transcript. He questioned if this made a difference in our effort to transcribe the once a year meeting called for in our charter.
Ms. Durdan asked given the amount of information provided, who determines how it is summarized. Mr. Gugliotti replied that that is the beauty and art of minutes. Roberts Rules of Order talks about minutes. He questioned whether there is any rule that requires a transcript. Mr. Harrison stated he did not know the answer and asked Brandon or Steve to research what other towns do and to report back. He wanted to know if it being a hearing, does it make a difference in the level of detail recorded. He also wanted to know if there was anything that prohibited the Board from using minutes instead of a transcript. He further stated that we have had a transcript for the last several years. He acknowledged that the task of transcribing the meeting is a time consuming task. Minutes are published as a draft within 7 days of the meetings.
April 9, 2012 Public Hearing
April 11, 2012 Budget Workshop
Section I. James Speich was present at the meeting
Section III, page 4, 5th paragraph, 7th line: change to read – salaries are locked in through contracts.
Section III, page 5, 2nd paragraph, 2nd line: change to read - Some people are unable to find full time work
Section III, page 5, 2nd paragraph, line 1: correct spelling to culvert
Section III, page 5, 2nd paragraph, 5th line: change to read – how to pay the burden of
Section III, page 5, 2nd paragraph, 11th line: correct spelling to Gugliotti
Section III, page 5, 2nd paragraph, 12th line: change “to” to “too”
April 23, 2012
May 16, 2012 Special Meeting
Section VI, page 3, correct punctuation in heading
Section VI, page 4, 2nd paragraph, change inaudible to read – of assessments
On a motion by Mr. Harrison, seconded by Mr. Stoll, it was voted:
RESOLVED: That the Board of Finance approve all four sets of minutes as amended.
Messrs. Harrison, Stoll, Gugliotti, Hamilton, Speich and Mmes. Durdan and Bratton voted in favor.
Mr. Hamilton abstained from voting on the April 23rd minutes
Mr. Speich abstained from voting on the April 23rd and May 16th minutes
V. NEW BUSINESS
11/12-28 Approve Suspense List, $16,751.12
Deborah Fioretti, Collector of Revenue presented a report to the Board listing the accounts that are uncollectable. Mr. Stoll asked for clarification of when repetitive names are removed from the list. Ms. Fioretti stated that a name is removed when the registration expires and that would trigger removal from the tax roll. Mr. Gugliotti stated that although our collections list is small, was there an interest in selling the debt, similar to real estate tax lien sales in other municipalities. Mr. Robertson stated Avon has historically not done this, and Ms. Fioretti highlighted that there was no real estate debt on the list. The discussion focused on the value to the town of pursuing a means to recoup some of the outstanding taxes due. It was concluded that through current procedures we have not been able to locate most
debtors on the list and therefore it is likely that no market exists to purchase their obligations. Mr. Gugliotti questioned if debt in connection with bankruptcies is turned over to the Town Attorney to file proof of claim. Ms. Fioretti stated she files the claim and follows up, however, rarely are the funds realized particularly with business bankruptcies.
Mr. Harrison commended Ms. Fioretti on her diligence in collections and low suspense list.
On a motion by Ms. Durdan, seconded by Ms. Bratton, it was voted:
RESOLVED: That the Board of Finance approve the suspense list as submitted.
Messrs. Harrison, Stoll, Gugliotti, Hamilton, Speich and Mmes. Durdan and Bratton voted in favor.
11/12-29 Board of Education: Supplemental Appropriation Request, $42,503 (unbudgeted revenue).
Mr. Robertson stated this is similar to the requests we have previously received to realign funds previously deposited into the Revolving Account. This is Grant Revenue. This is a supplemental appropriation to move it into the general fund operating budget.
On a motion by Ms. Durdan, seconded by Mr. Speich, it was voted:
RESOLVED: That the Board of Finance hereby amends the FY 11/12 Budget by increasing:
REVENUES
General Fund, Intergovernmental, Education Program Grants, Account #01-0330-43343 in the amount of $20,000; General Fund, Charges for Services, BOE Employee Bnft Contrb, Dent/Life, Account #01-0340-43505 in the amount of $12,545.72; General Fund, Charges for Services, BOE Cafeteria Rent Receipts, Account #01-0340-43510 in the amount of $9,957.28, for a total of $42,503
and increasing
APPROPRIATIONS
General Fund, Board of Education, General Service, Account #01-9401-52185 in the amount of $42,503, for the purpose of recording unbudgeted revenues received to cover Board of Education operating expenditures.
Messrs. Harrison, Stoll, Gugliotti, Hamilton, Speich and Mmes. Durdan and Bratton voted in favor.
11/12-30 Collective Bargaining Seminar – Summary: Tom Gugliotti
Tom Gugliotti stated that he would like to give a layman’s report on the way the statues work out in terms of the negotiations among the Board of Education, the Town, and the Unions with respect to teachers contracts. He attended a presentation put on by CABE, Connecticut Association of Boards of Education, several weeks ago, where the presenters, attorneys from Siegel, O’Connor, O’Donnell & Beck made an excellent presentation.
It was mentioned that when Ms. Bratton was the liaison, we were not invited to attend these meetings and that for several years the Town was not a member of CABE. Ms. Bratton stated that she spoke with Ames Shea to see if The Board of Finance could have a member attend, and Ms. Shea stated she would make that suggestion.
Mr. Gugliotti reported the quick take-a-ways were:
There is a very specific, very draconian statute that says what you can do, what you can’t do, and precisely when you’re going to do it. There are some hard & fast dates involved. The dates really back up from the date when the next budget is supposed to be submitted in the year in which the teacher’s contract would otherwise expire. There are very tight time frames.
The process is one where “if you don’t like it, lump it”.
This pertains to a statute, the Teacher’s Negotiation Act, TNA, it starts at CGS 10-153A and moves on from there. It basically states that Teachers and Administrators have the right to organize collectively and to negotiate. There is a mandatory requirement to negotiate certain things, not all things. The mandatory items are salaries, hours and other conditions. The statute goes on to say other conditions of employment shall not include the establishment of provisions of any retirement incentive plan. The speaker pointed out that it is a slippery slope, you can start out negotiating one item but then slide into salaries. For example, this came up in the Town of Wolcott a year or two ago, where the administration wanted 5 minutes of the teachers time to oversee school bus boarding, the
Teachers said ok, but then wanted to discuss compensation for that service and they were able to slide into salaries, which is a mandatory negotiating item. The statute states that 30 days prior to the start of negotiations a non-participant is to be appointed, that would be from our Board of Finance. The Board of Finance is recognized in the statute as having a role. That role is an observer’s role. The visiting member, or the Board of Finance member is entitled to listen, but technically is not supposed to participate in the caucus or the discussions, unless asked to do so. Ms. Bratton stated while liaison she was invited to share her thoughts during discussions.
Negotiations must begin 210 days prior to the budget submission date.
If as a result of that first session, an agreement is reached, the Board of Education must sign the contract and file it with the Town Clerk. The Town Clerk then must give Public Notice of the agreement. The legislative body, the Town Council, can reject the agreement in 30 days. If it is rejected, there is a whole process that follows. There is also a provision that allows the contract to be rejected by petition. This petition must be signed by 15% of the eligible voters in town. Whether the contract is rejected by referendum or by the Town Council, this would send the contract into arbitration, unless either side wants mediation prior to arbitration. This is the typical process.
Ms. Bratton commented that this is what happened during the last contract negotiation.
Mr. Harrison asked if the Town Council is required to take any action after the agreement is filed with the Town Clerk. Mr. Gugliotti responded that the Council can choose to do nothing, and that is typical. There is a 30 day wait until the contract becomes final.
If there is no agreement with respect to the contract, then 160 days prior to the budget submission date the parties are ordered to start mediation. The parties are given an opportunity to decide on who the mediators will be. If they fail to do so, the commissioner will appoint the mediators. These mediators are chosen from a pre-selected Governor appointed panel of mediators. The recommendation is that if there is a possibility you may go to mediation, you want to book your mediators as early as possible. The mediation season is very tight based on the time frames and the panel is limited to 7 pro Board, 7 pro Union, and 5 or 6 neutral. You are able to choose a panel of 3 or a panel of 1. If you do not pick the mediator (or arbitrator, as the case may be) the commissioner will assign these individuals for
you.
Ms. Bratton commented that during our last negotiation, during mediation we had a panel of 1 and when the contract went to arbitration, we used a panel of 3.
There is a maximum of 25 days to accomplish the mediation. If you are unsuccessful, then the parties go to arbitration. This is 135 days prior to the budget submission date. It is possible to agree on one arbitrator, but that is highly unlikely. Usually it is a panel of 3 where two are advocates and only one is a true arbitrator. These people are very experienced. They know the statutes and how the system works. There is a similar 25 day requirement to finish the arbitration. Once the arbitration sessions are finished, the arbitrator has 20 days to render a decision. The statute states that when an arbitrator issues a decision, they must include a narrative; the evaluation that was put into the decision, issue by issue.
Ms. Bratton stated that if the contract was rejected at an earlier stage for any reason, then all issues are back on the table for mediation / arbitration purposes.
Ms. Bratton stated that each year is considered separately. Mr. Gugliotti said that although the statute doesn’t state that must be done, it is how it is customarily handled.
Mr. Gugliotti went on to say the arbitrator must pick from the last best and highest offer made by either side. When the arbitrator decides, the statute tells the arbitrator what criteria he/she is supposed to use. The first criterion mentioned is to (paraphrased) give priority to the public interest and the financial capability of the town. The arbitrator can consider other financial demands on the town, CGS 10-153F, good faith of the parties involved, the interest and welfare of the employee group, the cost of living over the last 3 years, the existing conditions of employment of the employee group, salaries and conditions prevailing in the state labor market including contracts and settlements for other towns – both currently and historically.
The arbitrated contract is then sent back through the Town Clerk to Town Council process as stated earlier. The Town Council can reject the arbitrated contract by a 2/3 vote within 25 days of the publication of the arbitrator’s decision. Unlike an agreed upon contract the arbitrations contract cannot be sent to referendum. Upon rejection by the Town Council, the Commissioner must be notified within 10 days of the Town Council's reasons for the rejection, then the Union must provide a reply to the statements made by the Town Council.
The Commissioner will appoint a 3 person review panel. These individuals may only look at the record. There is no new information provided. They must issue a decision within 20 days. They still must pick from the last best and highest offer. If after all of these panels are convened, you are still not happy, the parties still can go to court. If you go to court and you lose, you pay for both your court fees as well as that of the opposing side. The statute specifies on what particular grounds you can go to court. The criteria are a violation of the constitution or statute, excess use of authority, some unlawful process – timing or appeal elements, error of law, clearly erroneous, arbitrary or capricious.
It is a tough statute and time frame that the Board of Education and the Unions must deal with. The opportunities to move within that framework are very limited, and there is a real downside if good faith negotiations do not occur.
An example was given referring to a Chapter 9 bankruptcy that Bridgeport filed about 20 years ago where it was determined that there was an ability to pay. If this is the benchmark, then Avon does have the ability to pay.
In final remarks Mr. Gugliotti stated that the state wide average for increases in the 2011-2012 year, the 3 year average was 6.7%, a big number. The year before was 6.4%. Mr. Harrison raised the concern, given the ability to pay issue, we also have referendum. If we put out a budget that reflects a high increase and the voters disapprove it, we have difficult options. Mr. Gugliotti stated that if there is a contract in place, the town must pay based on that contract. Ms. Bratton added that since we are negotiating in advance, there is a year prior in which the tough decision of cuts must be made. She added that both sides are aware of the consequences and that it becomes a compromise from both sides. Mr. Gugliotti agreed.
Mr. Speich asked for clarification as to why the Board of Education gave up its membership in CABE. Mr. Stokesbury stated that a prior superintendent recommended against continuing the membership as a way to balance the budget. Mr. Speich asked if it was correct that during negotiations, we were not able to take advantage of that association. Mr. Stokesbury states that all the negotiated bargaining results were compiled by our counsel, Shipman-Goodwin, who handles a vast majority of the work with the state, the contracts are all public documents that are readily available. CABE offers some services such as drafting of policies and lobbying. Ms. Durdan asked how much does it cost to be a member. Mr. Stokesbury stated it is about $10,000 per year. Ms. Bratton added that the cost of the class Mr. Gugliotti attended was
lower for members, so there are additional membership benefits. Mr. Stokesbury added that some of the classes offered by CABE are open to the public. He expects to use CABE as for some of the upcoming policy issues, trends in the law, he believes it is a good resource tool. Ms.Durdan asked if we know who our counsel will be for negotiations. Mr. Stokesbury said we will continue to use Shipman-Goodwin with our primary contact as Attorney Rebecca Rudnick Santiago and Tom Mooney when needed. Mr. Stoll asked if CABE provides support beyond collective bargaining, such as in the area of accreditation. Mr. Stokesbury said they provide a wide range of services, some for an additional fee and some as part of the membership fee.
Mr. Harrison asked Mr. Robertson to comment on an earlier conversation with Gary Mala, Superintendent. Mr. Robertson stated that on July 9, at 3:30 in the annex, there will be a meeting with the Board of Education negotiating committee to discuss strategy with respect to the upcoming negotiations, of which the first meeting is scheduled for July 25th. He expects a substantive discussion. This meeting is open to all of the Board of Finance members. If a quorum is expected to attend, this needs to be stated ahead of time due to the public notice requirements.
VI. TOWN MANAGER’S REPORT
A. Monthly Financial Report Summary
Ms. Colligan reported that we are closing in on the end of the fiscal year activities. Collections are doing well. Foreclosures are quietly running behind where they were a year ago. Licenses, Fees & Permits trends were taken into account when planning the 2012-2013 budget so Recording & Conveyance and Building Division categories were both slightly increased. Intergovernmental is expected to come in higher than appropriations for a couple of reasons. Temporarily due to Board of Education program revenues, so until all the supplemental appropriations are concluded, it will appear to be running ahead. We have been receiving revenues in excess of our appropriations. This has been due mostly to our pilot programs that are handled in the assessing office. This has been taken into account for the 2012-2013
budget. Charges for Services other than Board of Education activity is tracking on target. Other local revenue which includes many one-time fees and interest income of the General Fund is low and that has been taken into consideration for the 2012-2013 budget. Appropriations from Unassigned Fund Balance has had only one entry for BOE technology. We expect this to be the only entry. We are going to the market in November with the Library Notes so we want to keep this activity to a minimum.
General fund expenditures, excluding FEMA storm related expenditures, are running at 83% recorded posted through the end of May. The Board of Education is at about 85%. Special Revenue Funds are all doing well without any inter fund transfers. The open projects have to do with some FEMA issues. We have received almost all reimbursements for Irene with one still pending. We will wait and do one resolution to the General Fund.
B. Status of FEMA Projects
Mr. Robertson stated that the outstanding project on Irene is Deepwood Drive, which has a verbal approval but we are waiting for final written approval. Alfred is where activity is. Total cost is about $2.7 million and we anticipate reimbursement of $2.15 million leaving the town with about $600,000 cost. The difficulty has been with the turnover of FEMA project managers, and delays that causes. We need to have an award letter from FEMA by October according to our auditors from Blum Shapiro. We are doing everything we can to keep the pressure on to make sure we have this in a timely fashion.
.
C. Miscellaneous Updates
Mr. Robertson reported that he had a conversation with Mr. Harrison on estimating what Grand List growth might look like. The Grand List forms the basis for the tax levy which forms into the mill rate. Increases in the Grand List become very important when you talk about budgetary capacity. We are looking at development trends and build out scenarios, both on residential and commercial sides.
VII. OTHER BUSINESS
There was none.
VIII. EXECUTIVE SESSION: Heart & Hypertension
On a motion by Mr. Speich, seconded by Ms. Durdan, it was voted:
RESOLVED: That the Board of Finance go into executive session at 8:21 pm.
Messrs. Harrison, Stoll, Gugliotti, Hamilton, Speich and Mmes. Durdan and Bratton voted in favor.
At 8:39 pm the Board concluded the session.
IX. ADJOURN
On a motion by Mr. Gugliotti, seconded by Mr. Harrison, it was voted:
RESOLVED: That the Board of Finance adjourn the meeting at 8:39 p.m.
Messrs. Harrison, Stoll, Gugliotti, Hamilton, Speich and Mmes. Durdan and Bratton voted in favor.
Respectfully Submitted,
Thomas A. Gugliotti, Secretary
Attest: Mary Marinello, Interim Clerk
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