Center for Emergency services
North Stonington
40 Main Street
North Stonington, Connecticut 06359
860-535-2877
Meeting Minutes of October 27, 2015
ATTENDANCE:
Committee: Chairman Mark Perkins, Vice-Chair Joe Cassata, Paul Kowack, Bob Shabunia, Charles Steinhart V., Greg Howell, Brian Elias, Nick Mullane, Jon Bosma
Others: Treasurer Robin Roohr, Selectman Robert Testa, Peter Springsteel, Project Manager,
Kati Murphy, Committee Secretary
CALL TO ORDER
Meeting was called to order at 7:00 PM by Chairman Perkins
MINUTES:
MOTION to approve Minutes of October 19, 2015 made by Joe Cassata, second by Charles Steinhart V.
All in favor, motion passed
INVOICES:
Day Pitney, LLP – invoice #167145 - $10,500. Bond counsel services
MOTION to approve payment made by Jon Bosma, second by Charles Steinhart, V.
All in favor, motion passed
Kati Murphy – invoice # 66 - $115.50 Secretarial services
MOTION to approve payment made by Charles Steinhart V, second by Jon Bosma.
All in favor, motion passed.
CORRESPONDENCE:
Via e-mail to Committee:
Letter from Mark Perkins to First Selectman Mullane regarding funding of Committee secretary position. Committee acknowledged receipt
Discussion:
Nick stated that it is a necessary expense that will be covered.
PUBLIC COMMENT:
None
OLD BUSINESS:
Treasurer Robin Roohr addressed the Committee and informed them that as of October 15, 2015, the $2.6m note had been rolled and is now owned by Eastern Bank, at an interest rate of .7%. The note is due January 15, 2016. At this time Ms. Roohr is unsure as to whether or not a 12 month or a 6 month note will be issued. It will depend upon when the contract is actually bid, having a better handle on actual cost, and when construction starts. As far as the outlook for money, we have 3.35% locked in with USDA for $6.36m. As of this afternoon, municipal bonds on the open market are ranging from 3.75% to 5%, depending upon maturity. The farther out the maturity, the higher the interest rate. Ms. Roohr’s recommendation was, that at this time, USDA is still the least expensive method of borrowing, because it is unknown
at this point when the building will be complete. There are also no large borrowing costs with USDA. If the Town does their own borrowing the associated costs would be quite hefty.
Mark Perkins stated then that there is potential that in January of 2016 we would go out for a one year note and when that expires if rates are still in favor of USDA it would be at that point we would roll into the USDA loan, depending upon project completion. Robin stated that it all depends on next week’s election results and what options the new Boards of Selectman and Finance want to go with.
Nick Mullane urged the Committee to be more accurate and borrow that amount that’s needed to complete the project. Every time you borrow it costs significant money. So far $216k has been spent on borrowing costs.
Mark wanted to know how long the USDA rate of 3.35% is good for. Nick’s understanding is that as long as the project is viable and town going through the process to complete it, the funds are reserved at that rate. Peter Springsteel will ask Joann Demars at USDA for clarification on this.
Charlie Steinhart stated that the latest email from Ms. Demars indicated that the Town needs to provide USDA with a plan for additional funding and that a vote needs to be taken before we can bid. Clarification is needed as to what Ms. Demars means by “vote”. Is it a Town vote, or a vote by Town officials? It was mentioned that perhaps Ms. Demars does not have clear understanding of how the Committee wishes to proceed, by bidding first, so that the exact amount of additional funding is known. Once bids are received the Committee will request going back to the Town to vote on the additional funds. Committee does not intend to go back to the Town more than once. USDA is asking for the opposite of Committee’s intent. Peter will add this issue to the list of questions for USDA.
Nick suggested a meeting with USDA to explain our position and reasoning behind it and to also explain municipal procedure to Ms. Demars.
Robin questioned whether or not USDA would increase the amount of the loan, should the Town agree to additional funding. USDA has told Committee all along that additional funds may be requested. The Committee needs to make sure this is still so. When going back to Town Meeting they need to be able to tell the voters that USDA will include the additional money in the loan and that USDA is still a viable option. Peter will ask Ms. Demars for confirmation on this.
Joe Cassata asked what would happen if USDA did not approve of how Committee wishes to proceed. Nick indicated that the Town would then go to the open market Joe’s feeling was that what USDA is requesting if forcing the project backwards and dragging out the process. The longer it drags on the more money it costs. His opinion was to go out to bid and have hard numbers to bring back to the voters. If USDA does not like how we are doing things than maybe they are not the best option for funding.
Mark stated that if we walk away from USDA at this point someone is going to have to explain to the taxpayers why the Committee cost them, at a minimum, an extra $500k in borrowing fees and interest when we know that construction won’t be starting until mid-March 2016, at the earliest. With upcoming elections there will be changes to both the Boards of Selectman and Finance and the new members are going to want time to review and analyze the project. Rushing to bid will not be to the project’s advantage.
Joe asked why bidding could not take place, parallel to discussions with USDA. Peter informed that USDA has comments that are needed for inclusion in the bid documents. Ms. Demars is holding them until all of her questions are answered.
Bob Testa asked if anyone had contacted Ms. Demars last week, when she sent the email, to discuss the issued. Peter stated that he felt it needed to be discussed by the Committee before approaching Ms. Demars. Bob’s opinion was that it’s the Town’s place to deal with the financial decisions.
Mark Perkins stated that word had been received from Representative Urban that an item for the $300k will be on the agenda for the next Bond Committee hearing. Mark asked if Selectman’s office had received this information. Nick stated that a call did come from Representative Urban regarding this. There is no guarantee that it will make it all the way through.
Joe stated that he’s been the one contacting the Representative’s office. Joe indicated to her that both Mark and Nick need to see something in writing on this. He was told by the Representative that communication, in writing, from her regarding this funding should be forthcoming to the First Selectman, and Committee Chair. Joe’s feeling was that it will be advantageous for the Selectman to jump on this, rather than just him. It shouldn’t be his or the Committee’s job to get this commitment of funding, it should be the Board of Selectman.
Jon Bosma asked if anything formal has come from the Town to Representative Urban. His recommendation was that the Town should be sending monthly letters.
Mark stated that the Committee had never asked the Selectmen to send a letter to Representative Urban and that he had informed the Selectman that the Committee would continue to pursue the matter with her.
MOTION was made by Bob Shabunia to request that the Selectmen send a letter to Representative Urban requesting information on the status of the additional funds she has been attempting to secure for the project. Second by Ryan Burdick.
All in favor, motion passed.
Nick Mullane will send the letter tomorrow.
Paul Kowack stated that there are $611k in delinquent taxes owed to the Town that we could consider to make up part of the project deficit. Nick stated that there is a process to follow in order to collect that the Town has been undertaking. Due process is time consuming. It is a legitimate idea, but it is a difficult and long process.
Peter was directed to contact Joanne Demars at USDA and explain the process that the Committee has planned for bidding. He will tell her that Committee members are available to meet with her, at her convenience. Once things are straightened out with USDA Peter will prepare a new Project Schedule.
Paul Kowack, Bob Shabunia, and Peter Springsteel will be meeting to firm up the numbers on Paul’s/Bob’s spreadsheets.
Charlie informed the Committee that the Fire Company has been keeping brush cleared along fence line on Rt. 2 and Rocky Hollow Rd. to keep the site looking clean. Mark reminded the Committee that the site belongs to the Town once again. Suchocki & Son will return in the spring to reseed areas on the hill that did not take. Suchocki received their Certificate of Substantial Completion from USDA.
Nick asked if Stadia Engineering had fulfilled all of their obligation to the Town – they have.
Joe wondered if it would be worthwhile to contact the State and ask them if they could clean up the slope, between the roadway and their fence along Rt 2. Nick said if someone provides him with a scope of work he will contact DOT. Nick will also ask the Highway Superintendent to contact the utility company to see who they have in town doing tree cutting and see if we can get them to do some clearing along utility lines.
NEW BUSINESS:
None
MOTION to adjourn made by Paul Kowack, second by Bob Shabunia.
All in favor, motion passed. Meeting adjourned at 8:00 PM
Next meeting scheduled for Monday, November 2, 2015
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