TREASURER’S UPDATE Mr. Mattiello reviewed our current bonds status, explaining how they were done, and why. Notes were taken on City Hall for $7,000,500 in October of 2009. They were due in May and we were supposed to go out to bond in May. Since the City Hall project wasn’t finished, he said, and there was a need to borrow some money for Torringford School, we borrowed money in six-month notes. In December 2010, the rates were coming down and Build America taxable bonds were available. The Board of Education appealed their Torringford School fine for issues regarding enrollment, configuration and square footage, and the fine was reduced to 1.1 million dollars. Since the City was eligible for the Build America bonds, which are subsidized and produce a 35% rebate on the money, $985,000 from the City Hall Project was put together with the monies needed for the Torringford School project in “Series A” and put out to bid. The rest of the money, $11,855,000, was put under the Build America bonds. The subsidized payment will be $614,647 and will be budget for with money coming in on the revenue side, and $175,000 placed in contingency for any warrantee work. He said we have 20 years of payments on these, but Vogel Wetmore School just came off this year so this replaces that payment. Vogel was about million dollar payment.
Mr. Mattiello then reported on the City’s credit rating process, which included an interview by Moody’s, and a cost of $7700. We have a lot of pluses, as we prepare well for vehicles and other capital projects, we have resources, pay our bills on time, have good revenue sources and have an excellent management system in place for our money. However a negative outlook is added due to our borrowing from the undesignated fund balance. Overall, the rating is very good. Mr. Mattiello said our target undesignated fund balance should be 5%, but right now we’re at 3.7% of our total budget. We have a good tax base with below average wealth and moderate debt position but our negative outlook reflects the City’s diminishing financial position as result of continued use of reserves for
operating expense.
Mr. Mattiello updated the Board on banking services as the Finance Department has looked at Actuarial services, Audit services, and Bond counsel. In every case they have saved money in all areas. He met with a lot of banks and asked for proposals from seven. In the end, Bank of America offered a lot of services, reduced their rates, offered remote deposit scanners, purchase cards with rebates, and credit cards for City Clerk’s, Building, and Police Departments. The Tax Collector will use the credit card service next year. Mr. Mattiello will meet with Bank of America quarterly, and signed no contract with them, working one month at a time. He said there’s a lot of services that we can take advantage of. Mr. Farley asked about the credit card fee and Mr. Quartiero said there is a 3%
surcharge paid for by each credit card customer.
Mr. Mattiello explained his investment plan, where rather than allow revenue account money to remain idle, it would be placed in a one-year CD paying 1%. He asked the Board if they were in favor of this plan and they nodded in approval. BUDGET PROCESS Mayor
Bingham reviewed the 2011/2012 budget process, saying that Department Heads have been asked to submit their budget by end of last month with a 7% reduction. He said he wants to prepare for a large cut in state funding and is watching out for the Governor’s budget address on February 16th. His goal is to have a no-impact tax year and to lessen the impact on taxpayers. He means to recommend a budget that reduces the mill rate, or keeps a steady hand on it. He said he wants this budget process to be very fluid and open and added that any suggestions are welcome. He said negotiations will be held with the City Hall Union, Public Works, and Local 818. The Blue Ribbon Commission is working on recommendations they received, including the relocation of the Board of Education and
reevaluating the use of City vehicles by Department Heads. Mayor Bingham asked the Board to be familiar with the budget and to be proactive.
Mr. Scoville asked when a Grand List figure is expected. Mayor Bingham replied that an extension was needed this year and Appeals are being scheduled now. Mrs. Pesce asked about suggestions from the insurance committee. Mayor Bingham said that the Health and Welfare Consultant is working directly with Tom Gritt and Vic Muschell, and this is one of their top priorities, as well as pushing hard to make it consistent throughout the town. He said Anthem’s proposal went directly to
Lindberg & Ripple who should have a recommendation by next week.
BUSINESS: MAYOR & BOARD MEMBERS On a motion by Mrs. Traub, seconded by Mr. Paganini, the Board voted unanimously to consider business by the Mayor and members of the Board of Finance.
Mrs. Traub said that in a recent arbitration she and the Mayor presented the financial picture for the City, and expressed their concern about not touching that undesignated fund balance, knowing that an arbitration panel looks at it as a way to have extra useable money. She asked about outside contractor police duty, and whether the revenue coincides, if there are administrative fees, and the possible use of licensed flagmen. Ms. Proulx said there has been a lot of
outside duty this year for roadwork, but grant monies typically cover it. Mayor Bingham said they’ve started billing for vehicle use. Mrs. Traub asked if the Middle School Resource Officer’s salary will still be split with the Board of Education if the Officer started in January. She suggested everyone pay close attention to what’s happening to the State budget. She pointed out that the Board of Education has to be flat funded this year, so if there is a cut in State funding, it has to come out of the City side. Mayor Bingham said he felt there is room to cut the Board of Education budget if necessary. Mrs.
Traub thanked the City Treasurer for the information presented in this meeting.
ADJOURNMENT On a motion by Mr. Scoville, seconded by Mr. Farley, the Board of Finance voted unanimously to adjourn at 5:59 p.m.
ATTEST: JOSEPH L. QUARTIERO, CMC CITY CLERK
Respectfully Submitted,….. Carol L. Anderson, CCTC Asst. City Clerk |
