Town of Newbury
Finance Committee Meeting
Tuesday Nov 20, 2007— 7:00 pm, Town Hall
Meeting Summary
Committee: Eugene Case, Larry Guay, Pete Morse, Dave Newbert, and Frank Remley
Ex-Officio: Chuck Kostro, Finance Director
1. October 25 meeting summary: Approved with no further discussion
2. Issue with Lower Green School House project: Judy Tymon summarized the results of
the maintenance project on the Lower Green, historic school house. The project is
complete except for painting, which will be done in the spring with donations for paint and
volunteer labor. With two additional grants obtained by Vince Russo from the
Newburyport Five bank, and Judy Tymon from the Bushee foundation, the total out-ofpocket
cost to the town will be just $405. The committee decided to wait until the project
is entirely completed before transferring funds to cover the town’s share.
3. October Expenditure YTD Report: Chuck Kostro walked the committee through the
Oct. YTD expenditure report. There were no new surprises or reversals. Benchmark costs
should generally be at 33.33% YTD after four months. Highlights included:
a. Finance expenses are at 48% due to early acquisition of new software
b. Legal expenses are at nearly 45% for YTD due to cost of cell tower litigation and
cost to defend library boards dismissal of the director after one month of service
c. Public Bldg maintenance expenses are at 42% due to the Yellow school costs that
have not been reimbursed as yet.
d. Insurance expenses are at 42% due to upfront payments already made.
e. Town Library expenses are at 47% due to upfront $20,000 payment to the
Merrimac Valley Library consortium.
f. Certain other line items are high because of seasonality. These include Harbor
Master wages and expenses; life guards; road maintenance; long term debt
expense (payments in August and February); greenhead control; Whittier
assessment (paid twice per year); Essex County Retirement.
g. Despite the above overages, numerous items were below budget YTD. The total
town budget is currently at 32.26% expended YTD, which is below the
benchmark of 33.33% YTD after four months.
4. Status of Revenue Collections, YTD: (See Recap summary below)
5. Status of FEMA collections: FEMA collections will be a minimum of $7340 short of
costs. Chuck explained that this could have been a lot higher as the DPW authorized
contractors to perform clean up and road repair work before knowing whether or not
FEMA or other funds would be there to pay for it. Apparently some of the work was even
done six months after the storm damage was cleaned up, which further risked nonpayment.
This prompted a discussion of the inherent financial risk in committing to
contract work before knowing if and where the money to pay for it will come from. All
agreed that better controls are needed in order to avoid painting the town into a financial
2
corner by incurring costs that are not budgeted or available. The FinCom also concluded
that even the current $7340 overage might not be covered from existing accounts.
6. FY 08 Recap for submission to DOR: Chuck Kostro summarized the draft Recapitulation Sheet
about to be submitted to the DOR. He explained that certain revenues are falling short of the
projections at the Annual Town Meeting (ATM) in May. Changes from the ATM and the current
Recap Sheet are summarized in the attached presentation. The largest shortfall appears to be a
negative projection of -$161,674 in motor vehicle excise tax collections (probably due to a
slowing economy). These shortfalls will be covered by higher than expected Cherry Sheet
reimbursements, a FEMA fund transfer from FY07; and a revenue sharing fund surplus, all
totaling $274,818. If accepted, the Recap will yield a net, positive free cash of $101,271. Other
anticipated revenues in FY08 include continued collection of back taxes, excess town land sales,
and an estimated free cash certification for FY 07, all totaling a minimum of nearly $600,000. The
Recap Sheet, submission letter and Finance Director’s presentation are available on the Town’s
7. Update on PI Land Sales: Chuck Kostro is working with Tony Penski, the Town Counsel
to properly affect the sale of the first property by sealed proposal. Other sales will follow
once this one is completed.
8. Update on Library expenses: David Newbert met with the Chairman of the Library
Board and ascertained that any severance due the recently dismissed librarian will be
covered by a delay in hiring of a new Librarian. He also was informed that the overage in
early spending was due to an annual fee of $20,000 that is due in July to the Merrimac
Valley Library Consortium.
9. Potential changes to Capital Planning Committee: Bill Cooper has regretfully informed
the FinCom that the pressures of his new business will prevent him from devoting much
time as Chairman of this committee. Dave Newbert agreed to take over chairman’s role at
least on an interim basis.
10. Other:
a. After a brief discussion about approving a 3% increase for employees beginning
in January, it was decided to delay this decision to make sure that the Recap sheet
is accepted by the DOR.
b. Judy Tymon distributed copies of the latest financial impact analysis of the
Village at Little River project. This was done by the town’s financial consultant,
Judy Barrett, working through Taintor Associates. Current projections show an
annual net income of $442k, and a one-time, up front revenue of $744k to
Newbury. A copy will be available through the Planning Board’s web-page.
11. Next Meeting: tentatively scheduled for Thursday, Jan. 10, 2008
| 
