Town of Newbury
Finance Committee Meeting
Tuesday, April 20, 2010; 7:00 pm, Town Hall
Meeting Summary (draft)
In Attendance: Bob Connors, Bill Cooper (Vice Chair), Larry Guay, Dick Passeri, Frank Remley (Chair), Anna Tenaglia
Ex-Officio: Chuck Kostro, Town Administrator/Finance Director
March 16 Meeting Summary; March 16 Executive Session Summary; March 23 joint BOS meeting summary: All summaries adopted unanimously without further change.
March YTD Revenue and Expense Summary:
Expenses: After a cursory review of expenses year-to-date, no significant concerns were raised. Overall expenses are about 5% above average (80% vs. 75%), but certain major expense items, such as debt payments, Essex County Retirement Commission, and insurances have been fully paid for the year. Remaining expenses are tracking reasonably well with projections.
Revenues: An updated revenue report was not available. The finance director felt that excise taxes, which are a continuing issue, were starting to pick up. There were no new concerns expressed.
Reserve fund changes: Finance Director
a.
Bldg Maintenance: a request for a transfer of $10,000 from the reserve account to the building maintenance account was unanimously approved. The reason is that the public building maintenance account was inadequately funded going into FY10.
b.
Conservation Commission mailing: A $1200 transfer from the reserve fund to Conservation Commission expense was approved unanimously for unanticipated mailing expense.
c.
Electrical Inspector Fees: A $1500 transfer from the reserve fund to electrical inspection fees was unanimously approved for unanticipated inspections and associated fees.
d.
Tree Warden Submission of emergency work invoice: An unanticipated $8400 invoice from Steven Noyes Tree Service was presented by the Finance Director for emergency tree work during the April rain and wind storms. Since the tree warden’s original budget was already over expended, and the invoice lacked key information, such as dates and work detail, was unsigned, and no formal transfer request made, it was decided to invite the tree warden and Mr. Noyes to the next meeting on May 18 to explain the invoice in more detail, and make a formal request for funds transfer if warranted. It was proposed that the chairman draft a letter to the Tree Warden to this effect.
FY 11 Final budget proposal and Revenue Forecast: The Finance Director presented an updated FY 11 revenue forecast and expense appropriation budget. Since the March 16 Finance Committee meeting, and largely at the Finance Committee’s recommendation, he added the following items to the expense appropriation budget:
a.
$75,000 to the reserve fund, which previously had no funding,
b.
2% COLA for non-contract town employees (approximately $50,.000),
c.
$10,000 to the Board of Selectman compensation budget (restoration of $5000 per)
d.
$20,000 to the Building Maintenance budget, restoring it to $90,000, and
e.
$15,000 contingency for a consulting engineer.
While the Finance Committee favored these additions, they unfortunately resulted in a $175,250 deficit budget as FY 11 projected revenues were not high enough to cover the additional costs. Discussion focused on several possible additional sources of revenue, including:
Recovering a portion of approximately $180,000 in the Overlay Surplus Fund,
Additional use of approximately $119,000 currently in free cash,
A $250,000 tax override request, since debt exclusion payments would be reduced by approximately that amount in FY 11,
Or, as a last resort, additional transfer from the current $334, 0000 stabilization fund.
Unfortunately, the Board of assessors has yet to approve a transfer from the Overlay Surplus Fund. After discussion, it was voted unanimously to recommend elimination of $39,000 in life-guard funding for FY 11 as a cost saving measure, and approve a deficit budget of approximately $175,000, subject to on-going review with respect to additional sources of revenue. The committee felt that the likelihood of generating additional revenues, and the safety factors in place, including the possibility of additional cuts in the fall, made this a safe financial position going into FY 11. The Committee voted unanimously to recommend this approach to the Board of Selectmen. The committee also voted unanimously not to utilize $50,000 from the stabilization fund, as projected but rather to draws this
amount from free cash.
Town Meeting Warrant Articles: The Town Administrator walked the committee through the proposed warrant article for the Annual Town Meeting (ATM). The committees voted to recommend all articles impacting town finances as required. These include articles 3 thru 9, 11, 13, and 30.
6.
Other:
Highway Barn engineering study: Engineering proposals have been received and the selection committee, including the Town Administrator, Town Engineer, and DPW director, would soon make a decision and work would commence. The cost of this effort is a fixed price, not-to-exceed $15,000.
TRSD Update: Larry Guay reported no new developments with respect to the school budget, which has been passed by the school committee.
Town Meeting prep: It was agreed that the Chairman would provide a very brief overview of the Town’s longer term financial situation.
Next Meeting(s):
Tuesday April 27, Joint meeting with Board of Selectmen
Tuesday May 18, 7:00 pm, Town Hall
Tuesday May 25, Town Meeting, Newbury Elementary School
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