Finance Committee

Lyman Building

April 3, 2000

Members present: Morey, Nash, Roberts, Rourke ,Vogt

Town Admin. Linda Sanders

BOS: McCallum, Reggio

Meeting called to order at 6:30 by Chair Morey

Minutes

FinCom voted unanimously to accept minutes of March 23, 2000

Discussion on Article 11 of annual town meeting with Board of Health

Chair Morey opened the floor to Mary Krapf and Cedwyn Morgan from the Board of Health (BOH) for discussion regarding transfer station and the funding for it.

Mr. Rourke asked the first question regarding the funding and questioned the BOS as to whether they supported the transfer station, as it does not appear on the warrant. If it is not listed where would the money come from?

Mr. Morey explained there were several options for funding. Appropriate funds from the levy limit, take the money from the landfill escrow account, set up a revolving or an enterprise account.

Ms. Krapf noted she had been in touch with Joe Lambert form the DEP. He was not in favor of an enterprise account but felt a new account, transfer fund account was the way to go. The funding should come from the escrow account. Several towns similar in size to Ashby such as Brookfield, N. Brookfield operate with a transfer fund for this purpose.

Total cost of operating transfer station is $33,000. Of the total $17,000 has been paid out of the escrow account already. The account needs funding in the amount of $16,000. Discussion followed which considered raising the cost of bags and decreasing operating expenses by restricting the taking of white goods from anytime, to quarterly and having the station open twice a month instead of four times a month. Ms. Krapf noted that she has applied for a cooperative effort grant that looks very encouraging. It would provide containers and a bailer to compact waste. A container for CRT waste such as VCRs and light bulbs would also be provided. The DEP would pay for the set up of these containers. The town would be responsible for the rental or purchase of the containers. When asked where the funds for the containers would come from Ms. Krapf recommended it come from escrow.

Mr. Morey suggested we use the receipts to offset the cost with the use of a revolving account. BOS do not like this kind of account. Mr. Reggio explained the board is not in favor of this because it is not included in the town budget process, taking the control of funding away from the town. Mr. McCallum also noted that receipts are used to offset the money that goes out and as revenues streams rise expenses also tend to rise. While this account has a negative revenue stream it may not always be this way. It is similar to a water company that raises rates as expenses rise, leaving town residents with no recourse.

Mr. Morey pointed out that the town already has several revolving accounts such as compost bins and police detail. He noted they are set up to run themselves and the transfer station should work the same way.

Ms. Krapf said the transfer station fund account should probably be set up as a line item. Mr. Rourke asked the BOH if they wanted a line item or would they be opposed to a line item and they responded that they had no preference, only that they wanted the funding.

Lillian Whitney, Treasurer, noted that a revolving account could be looked at every year at town meeting. It could be listed and would provide a way for the town to monitor the account.

A revolving account should be self-sustaining and not subsidized. Mr. Rourke asked BOH if they felt it could become self-sustaining in the future. Ms. Krapf explained that 1/3 of the town uses the station now and they hope to have of the town using it soon with the help of education and the benefits of recycling. Because so many people have contracted for curb side pick up it was questioned whether or nor it was fair to have them pay for the station in addition to what they already pay. BOH feels this is a question of choice. People donít have to pay for curbside when they can use the transfer station, which is paid for with town funds. If this account is seeded for a few years the BOH believes it will become self-sustaining. We currently own 2 containers and used containers are available from the DEP. Mr. Morgan also noted that most towns with transfer stations operate them with town employees. This is much more cost effective than having a third party employee. Most towns have a cooperative effort with the DPW. The DPW currently plows the road to the station and the DPW employee can be rotated to work at the station twice a month. Mr. Morgan noted that the biggest expense to the operations is the labor expense currently at $20,800. Ms. Vogt suggested that this should be considered for future planning and that perhaps it needs to be given some serious thought by the BOH and BOS.

Mr. McCallum suggested we use estimated local receipts since they wouldnít affect the budget. Any extra fees not needed for expenses would go to free cash. Another suggestion he brought up is article 10 to use a contract with a third party to operate the station. It was determined that using a third party is the same situation we currently have now and it is not a viable alternative. Mr. Morey noted that the transfer station has been using escrow funds to pay operating expenses all along. He asked the BOS why they want to stop it now. It was never sanctioned as an appropriate use of the funds but the BOS could vote to make it legal and so doing would keep it running as it has been to date. He also noted the article says to ìraise and appropriate ì, and we have no way to do that. The funds must be taken from somewhere. Mr. Rourke again raised the question about this not appearing on the warrant.

Mr. McCallum noted that both FinCom and BOS have $7000 left over in the budget. Taking those funds from the $16, 000 deficit still left a balance of $9000 to fund for the for the transfer station. He suggested budgeting this amount as an on going expense. The old dump was funded as an operating expense and it is only through the prudent negotiations of the BOH that we havenít had to fund the transfer station to date. He is against using the escrow account as he felt these are operating expenses and should be treated as such. The town should use large money for large purchases instead of allowing the funds to get eaten in small pieces and have nothing to show. Mr. Rourke again asked how the BOS wanted to fund this article, keeping in mind that the use of the escrow account could be used to monitor the landfill for a long time putting off taking money from the budget.

Mr. Rourke asked Mr. Morgan what their cost estimates of monitoring were for the next 30 years. Mr. Morganís initial reaction was $20,000 for the first 5 years and slightly less than that after a few years depending on the testing of the wells. FinCom gave him a financial schedule of monitoring given to them by the Open Space Committee that had been prepared by an attorney in Fitchburg. This schedule called for $10-15,000 the first year and $5,000 every year thereafter. Mr. Morgan had not seen the information and did not know why there was such a big difference in funding. The BOH promised to look into the matter and report back to FinCom on their thoughts for the real cost of monitoring as well as their recommendations for the funding of the monitoring.

Mr. Nash noted that the highway dept had $11-13,000 left in the sand seal account from last year and asked if it were possible to use the extra from there to fund the transfer station. Ms. Vogt stated she hated to take away from the materials in the highway department. With the new homes being built in town the roads were going to become increasingly important to have in good repair.

Mr. Rourke noted that the same conclusion had been reached during the discussion to take funds from materials to use for a new truck. Taking the tools away from the dept wouldnít be prudent.

Mr. McCallum suggested we present warrant articles to the town before the budget to see if the town wanted to shift things around. Mr. Rourke warned against that since it creates havoc with the budget. Our job was to present a balanced budget and to bring warrant articles before the budget could defeat the budget process.

BOS want to present the shortage as an operating cost in a line item. Mr. Morey opposes that method as he feels the town does not support the transfer station by the fact that the majority of the town is not using it.

Voting on the article was postponed until Thursday pending recommendations from the BOH as to the amount of funding and where the funding should come from.

Mr. McCallum suggested we change estimated local receipts by $17,000, make a separate line item for transfer station receipts and fund the $8900 shortage. Mr. Morey asked the BOS to take a vote on the funding for the article to give FinCom the information they needed to take a vote. Mr. McCallum recommended taking $8900 from the sand seal account to fund the transfer station shortage. Mr. Reggio agreed and the vote was taken.

FinCom then motioned to take $8900 from line 29, sand seal, to be used to fund the shortage needed for the transfer station. Unanimous vote taken.

3. Reserve Fund Transfers

Chief Victoria presented his need for a funds transfer of $9000 for police expenses. This account was funded with $36,000 this year and he is down to $0 and still has the months of April, May and June before the next fiscal year. Research of his records produced $11,117.10 of unexpected items since October.

Items listed included:

The expiration of their user agreement

Expired server agreement

Expired service agreement of photocopier

A number of bills from August that were never paid including maintenance of the new cruise, and

Higher lock up fees due to more arrests

He further noted that these expenses are a result of prior staffís mismanagement of expense operations. He must and will address the issues but he does not see this reoccurring in the future.

Discussion followed regarding the police expense budget and the possibility it will be short again this year as it was level funded. Chief Victoria will reassess the expenses and give new figures to FinCom and BOS on Thursday. It appears the dept runs at a cost of $4000 per month and not $3,000 as was previously thought. This means an increase for this yearís budget of $12,000 will need to be considered.

The Reserve Fund has a current balance of $5,347.01. Mr. Davis has also submitted a request for a transfer of $500 to pay for phone bills and shed expenses. This brings the account down to $4,847.01. It is under funded and cannot meet the needs of the police department. Chief Victoria was asked to see if he could manage with $3,000 for a few weeks and to come back with another request when the need arises.

FinCom voted to transfer funds from reserve to highway depart in the amount of $500.

FinCom also voted to transfer the sum of $3000 from reserve to the police expense account.

Mr. Nash asked Chief Victoria about article #7. He asked for clarification on the figure of $13,331.81. He had understood that this position would be 75% funded from 3 different grants and the town would pay for benefits. He also thought there was a possibility of matching funds for the towns portion and wondered what they would be.

Chief explained:

Base salary of $27801.50 x 25% = $6950.37

Benefits = $5581.44

Total $13,331.81

He was going to try for matching grant money but couldnít guarantee it would be approved. He said it was possible he could this cut in half and maybe down even more. There is $16,000 available for community policing and $16,000 available for law enforcement block grants. Community policing is used for overtime wages other than regular patrolling. Such things would be for coverage at ball fields, work in the school etc. Mr. Rourke asked if police overtime wages could be reduced if a second officer position was created. The Chief explained that a lot of his overtime now consists of fulltime officers working because reserves have other jobs and are not available to put in the time so it was reasonable to expect to see a decrease in that line.

Vote for article 7 put off until Thursday when the Chief will look at the funding and also review his police expenses.

Annual Town Meeting

Chair Morey asked to vote on articles 1-6 for annual town meeting. FinCom voted unanimously to accept all 6 articles.

Mr. Morey questioned whether the town had voted last year to put money in town common repairs subject to a grant being received. Ms. Sanders said that they had. Mr. Morey explained that a person was running for park commissioner position who had plans to fix up the common and was counting on the money for funding. The amount was $4800 and was grant dependent.

Ms. Vogt brought up concern over all the articles related to Lyman building. Many were for funds and others were for faÁade repairs and another was for a committee. She questioned whether we should put more money into the building until the committee had a chance to make an assessment for the town. Mr. Rourke said he did not see the support for this project from the town as he has seen from the library committee. He cannot see the overall success of this plan. Mr. McCallum agreed that the wording of some of these articles was unclear and he felt that some people might not understand what is trying to be accomplished.

Article 8 still has a difference of opinion of FinCom and BOS. BOS want to fund a plan for the management of our EMS Service. They intend to fund this from the reserve account as they feel FinCom has over funded the account.

FinCom wants to see the plan before funding is made. They feel that the BOS have failed to manage the manager of this department and that it wouldnít be in such poor shape had they taken action sooner.

Mr. McCallum stated that the FinCom has in the past funded a project before plans were finalized. FinCom reminded him that if they did so in the past it does not mean this committee will follow. This committee believes a solution should be funded as this is important to the town but not before some research is done.

Mr. McCallum believes that if we fund this article for an EMS services coverage program we will eliminate the possibility of the fire department wanting a full time chief for $39,000 as part of the solution.

Mr. Rourke spoke about the reserve fund and how we have looked at it as part of a percentage of the total budget when perhaps it should be looked at from a forecasting approach instead. A typical approach would be to use a weighted average that would move along with the needs. Taking $46,000 which we needed for last year (20 plus 26 legal fees) we could use

60% of $46,000=$27,600

30% of $27,000= $9,000

10% of $20,000= $2,000

total for this year would be $38,000

Discussion from committee agreed that using this process was food for thought for next year.

Police

Police wages could be increased by 14% since there is no retroactive wages included in the negotiations. Mr. McCallum noted that the union estimates increases will be less than $10,000.

Line 29, legal counsel services had originally requested $35,500. BOS had reduced their request to $25,000. FinCom had matched them. FinCom felt that these funds might be needed so they covered the $10,000 difference in the reserve fund.

Watatic Mountain land

Mr. McCallum stated that appraisal, title search and survey has been funded by the donor. Town counsel is doing all legal up to town meeting pro bono. The town wonít take any action until all money for legal fees and anything necessary are in an account. This article does not require immediate action and can be done at STM.

Kater property

It was noted that the article is not worded correctly as it does not have provisions for cemetery use of several acres. Mr. Pease had contacted the BOS to have them add 4 acres of land for use by the cemetery and it had not been done as of yet. The restriction is inside the field where the streams are. Mr. Morey asked how long the lands had to sit before we could do anything with it and Mr. Reggio replied it was in perpetuity. The seller is putting restrictions on the land before it is sold.

The big difference of opinion between the BOS and FinCom so far is still $30,000 funding for the EMS Service coverage program.

Meeting was not adjourned and will be continued on Thursday.