Finance Committee
Thursday, February 8, 2018
Rutland Public Library
6:45 p.m.
Present: Karen Nahrwold, Lyndon Nichols, Sheryl Vernon, Iain McKinlay, Tom Ruchala
Absent: Carl Bindoo, Deb Kristoff
Others: Margaret Nartowicz – Town Administrator, Laura Scannell – Secretary
Mr. Nichols opened the meeting at 6:46 p.m. The meeting was recorded for Channel 191.
APPOINTMENTS
6:45 p.m.: Bay Path
Dean Iacobucci, John Lafleche, and Ann Marie Pantos were in attendance to present the budget. The FY19 Governor's budget increased Chapter 70 funding by 2.2% (approximately $103.6M) from FY18. The current Bay Path budget request is based on the Governor's budget; any changes to the Governor's budget will need to be reflected.
There was discussion of the impact of Chapter 70 and required net school spending on the district. The district will be receiving an additional $139,131 in state funding compared to FY18, all towns' minimum contribution increased to $350,938. Net school spending must be $490,069.
Bay Path's total budget request reflects a 2.87% increase. Anticipated Chapter 70 funds - $10,463,147, School Choice Assessment $193,504 to be deduced from Chapter 70 funds. Collective Assessment $8,161,677 – requesting $200,000 above the minimum. E&D (OPEB Transfer) $50,000, appropriating $351,027 from E&D to reduce assessments. Total Operational Budget - $19,032,347.
Transporation Budget – estimated at $1,479,463 with $990,549 funded by Ch-70 and remaining $488,914 by assessment of the ten member towns.
Debt Service $1,611,294 on building project. Currently paying $30,750 sewer betterment to Charlton.
Total operational budget for FY19 assessments - $22,153,854. Total including $193,504 School Choice Assessments - $22,347,358.
There have been no reductions in staff or programs. They are continuing to phase out the small engine program. Supplies and materials are adequately funded – includes funds for new Biology textbooks and replacements, a Digital Scanner for the dental assisting program, 10" Power Shear for Metal Fabrication, and funds to purchase equipment for the new Information Support Services and Networking Program (ISSN). After consulting with the State on a potential Criminal Justice Program, the State decided not to open any new programs. Bay Path will pursue ISSN instead – an application for the program has been filed with the State, will be advised next week. There are many jobs available right out of high school in ISSN with a robust secondary education environment.
Budget includes funds to add 1 full-time equivalent ISSN teacher (will be offset by the reduction of 1 FT Power Equipment Teacher who is retiring, not filling the position). Funds are included to provide wage increases for non-union employees, and a 4.7% increase in health insurance premiums. There was discussion of health insurance benefits – staff payment versus employer payment at 85/15, for past nine years was 70/30.
Assessment changes are based on foundation enrollment, up by 5 students, about 0.5% for Rutland. Rutland gained 6 students (18.18% increase). The Freshmen seat allocation is based on student capital population. Rutland increased, now represents 9.23% of total amount of school-aged children in the ten district towns. 29 seats are allotted to Rutland for the coming year. Bay Path anticipated bringing in a total of 315 freshmen in September. Member town assessments – Rutland increased 13.66%, total assessment $453,047.
Rutland's minimum contribution increased by 18.54% - this is reflective of the number of students. FY19 proposed assessment for Rutland's minimum contribution is $278,073 – an increase of $43,487.
Mr. McKinlay asked if Rutland is likely to fill all 29 seats. Mr. Iacobucci stated the seats are available, but not likely to fill. Bay Path averages 9 students from Rutland per year.
Mr. Iacobucci presented a breakout of the total assessment for Rutland. $453,047 total assessment is comprised of minimum contribution ($287,073), share of assessment above minimum ($6,783), share of transportation ($16,581), debt service ($148,771), and sewer/capital improvement ($2,839). Total assessment increase of $54,450 from FY18.
Final audit of the building project should be available in April, if not it would be on the July agenda at MSBA. The project should be wrapped up by the end of this calendar year. Last year a need to replace the underground propane tank was identified – finished around Thanksgiving at a total cost of $419,705. The project is substantially complete, but some items (i.e. landscaping, seeding, fencing) will be finished in the Spring.
They are continuing to explore building a 40-space parking lot to address a lack of parking. Estimated cost $200,000 – do not anticipate assessing member communities, looking into capital money to free up within the budget.
Required net school spending has created a dilemma for the district. Except for the current and next fiscal years, they have never built a budget on amount above net school spending. If 100% of the operational budget is not spend, they have not met net school spending. The State tracks the amount and adds to the coming year. Tracking the past ten fiscal years, the district has been below net school spending by $701,203. The FY18 requirement was $18,134,755. The district is still required to spend $701,203 from the previous years. They are working to get the number down. If it becomes greater than 5% of the operational budget, the State will reduce Chapter 70 funding. It will take several years to eliminate the total $701k, but they are hoping to know it down by at least $100,000.
There was discussion about the E&D OPEB transfer of $50,000. OPEB liability is approximate $7 million, currently OPEB balance $277,000. They are committed to appropriating $50,000 to continue funding. This does not count toward net school spending. E&D will be reduced $50,000 and $351,000 will be applied from excess and deficiency.
There was discussion about the number of slots for Rutland students. Mr. Ruchala asked if the Town pays for 29 seats if Rutland only has an average of 9 freshmen start per year. Mr. Lafleche explained the minimum contribution is based on the number of kids actually at Bay Path. Above minimum contribution it is proportioned based on the number of kids a town has at the school. Rutland has 39 out of 1150 total students in the school.
Debt assessment in place where towns are paying for capacity. The district agreement states the school reserves seats based on the total number of K-12 students in Rutland divided by the total K-12 students in all ten towns. A total of 1,748 students live in Rutland – all towns combined there are 18,932 students. 9.23% of K-12 kids live in Rutland therefore Rutland is charged 9.23% of debt.
There was discussion about the possible legislature on transportation reimbursements. Mr. Lafleche stated all regional schools are lobbying for an additional $2 million. Senate Bill 223 would fund foundation budget reserve recommendations that would be more advantageous to Wachusett – would cover special education and ELL. If that gained traction, they might not have funds available for bussing. Bay Path's budget allocates what the Governer came up with.
Ms. Nartowicz informed attendees of the Council on Aging's series on Drug Addition Awareness – next session to be held on February 28th in the Rutland Library.
MINUTES
Mr. McKinlay moved to accept the minutes from the February 1, 2018 meeting. Ms. Vernon 2nd. Vote unanimous.
Mr. McKinlay moved to accept the minutes from the February 6, 2018 meeting. Ms. Nahrwold 2nd. Vote unanimous.
Ms. Nartowicz provided an update on revenues, plugging in the debt exclusion from Bay Path renovations added another $6,000 to revenues. Currently total $913,302.95. Ms. Nartowicz should be able to provide a working budget next week.
7:30 p.m.: Water & Sewer
Gary Kellaher, DPW, presented the updated budget request. The water and sewer enterprise budgets were discussed previously at the January 23rd meeting.
Sewer – the only increase to sewer is contractual obligations for wages. Right now, they are down 2 sewer workers. Currently using highway workers, 2 hours per day each day.
Mr. Kellaher has made some reductions – cut overtime from 2,000 to 1,200 based on historical data. Mr. Nichols asked if the vacancies would require more overtime. Mr. Kellaher stated this is not the case, unless something happens outside of everyday functions. One position has been filled and will start the following Wednesday. Job postings will be kept up until the positions are filled – the job has been posted to multiple sites; there have been many applicants but not many qualified for the position.
Indirect charges – some categories don't have final numbers, will be updated. Purchased Services - $12,000 for Professional and Technical Services reduced by $5,000. The contract with Weston & Sampson remaining at $15,000.
Debt services decreased, quarterly charges down to $1,178.
Mr. Ruchala asked if the $603,754.36 for city of Worcester Treatment and Transportation includes the 5% increase. Mr. Kellaher stated it does, 5% is projected. He does not expect it come in that high but hasn't received the exact number from Worcester. Upper Blackstone is up 1.7%.
Ms. Nartowicz stated the budget takes the projected 49 new dwelling units into account.
Reduction in indirect charges from equipment rental: backhoe reduced to 100 hours, dump from 160 to 100, air compressor down to 100 hours. Total equipment rental $7,806.50.
There was discussion about the ongoing situation between Holden and Worcester.
Water – standard 3% increase. Wage increases ($18,146 to $19,200) due to contractual updates – keeping the unfilled vacancy in the budget.
Purchased Services includes 3% industry norm increase. Regular wages increased to $200,888 from $146,312 (FY18). There was discussion about State grants and DEP energy efficiencies funding.
Ms. Nartowicz stated that the water plant is on a power purchase net metering agreement for solar. The Town began seeing savings from that in October.
Purchased Services reductions – phone and beeper rental from 43,810 to 4908.76; switched from Point to VADAR software for 50% savings. The software helps with billing – the clerical staff doesn't have to spend as much time stuffing envelopes. Cost of software brings down manhours. Distribution system leak detection and water tank inspection level funded.
There will be an article in the Spring town meeting for DEP mandated media filters – approximately $40,000.
There was discussion about estimated income. Ms. Nartowicz discussed the lifting of a covenant on 20 homes, and several others to be built under ANR. All new dwellings would come with a connection fee of $1,600. Income will go toward the budget. Expected surplus of $4,828.69 after revenue applied to expenses.
NEW BUSINESS
There was discussion about the upcoming Special Town Meeting, scheduled for March 12th. The Board of Selectmen will be voting on the warrant at their next meeting – only one article on a recreational marijuana moratorium. Ms. Nartowicz will forward the final warrant to the Finance Committee for review at a future meeting.
The Special Town Meeting will be held in the Library meeting room with overflow room available. Holding it in the Library will reduce costs compared to holding the meeting at the school.
There was additional discussion about the DPW vacancies. Mr. Kellaher will be putting two additional employees into the budget – approximately $100,000 not including benefits. This will have to be reviewed at a future meeting. DPW budget will change as well as health insurance.
There was discussion about the managed growth study, and a fiscal impact study focusing on the impact on town services. Mr. Nichols stated managed growth should be used to market Rutland Heights for new businesses.
Ms. Vernon moved to adjourn the meeting. Mr. Ruchala 2nd. Vote unanimous.
The meeting adjourned at 7:55 p.m.
Respectfully submitted,
_______________________ Laura Scannell, Secretary
Approved on: ___________
_______________________ Lyndon Nichols, Chairman
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