Minutes of the Finance Committee
November 27, 2000

In attendance: members Farley, Nash, Morey, Raymond, Roberts, Vogt.

Chair Vogt called meeting to order 6:55 pm.

Introductions

Ms. Vogt welcomed and introduced the newest member of the Finance Committee, Jim Farley.

Chairman's Comment on Special Town Meeting

Ms. Vogt said she wanted to explain to the committee her rationale for her questions and presentation on the Special Town Meeting floor. She said that two weeks prior to STM, Mr. McCallum had told her that all negotiations with owners of Mt. Watatic had broken down and that the possibility of taking the property by eminent domain had come into play again. Ms. Vogt said she had been disappointed that the BOS did not disclose this information at the pretown meeting on November 15. She reminded members that at the last meeting we had discussed our concerns about the article—that the budget for the buying of the mountain contained no additional money for legal fees, and the additional problem that Mr. McCallum had promised towns people at the ATM that BOS would not be using eminent domain to buy the mountain. She reminded members that last year's Finance Committee chairman, Chuck Morey had said to BOS, FinCom will approve the article to buy the mountain if the donor would promise to pay all legal and other fees in the process of purchasing the land. This promise was never forthcoming, so FinCom had disapproved the ATM article.

Since the information about possible use of eminent domain came to her after the last posted FinCom meeting, Ms. Vogt went to Moderator Dennis Moore with her concerns. She said she felt the impact of this potential prolonged legal negotiation should be presented to townspeople and asked his opinion on whether she should speak from the podium as FinCom chair or as a citizen from the floor? Mr. Moore felt that since she was addressing financial impact for the town, it was appropriate for her to speak as Finance Committee Chair from the podium.

She then drew up questions for Town Counsel and, on the day of the STM, went to Town Counsel to ask her opinion of the legality and appropriateness of the questions. Counsel reviewed the questions said they were good questions which needed to be asked in a public forum. When Ms. Vogt asked Town Counsel if she could address these questions to her at the meeting, Counsel replied that as of 9:30 pm the preceding night, she had been told by BOS Chair that she was not to represent the town in any issues relating to eminent domain. Ms. Vogt said she recognized a gentleman talking to the BOS chair before the STM whom she had seen before the BOS executive session following pretown meeting, so she made an educated guess that he was the eminent domain lawyer and in attendance at the STM.

Ms. Vogt said she had not originally intended to address her questions to Mr. McCallum, but rather to Town Counsel, until Counsel had said she was not authorized to speak on this issue.

Ms. Vogt's questions to the BOS are attached to these minutes so they can be entered into the official record for the Finance Committee.

Ms. Vogt continued to report that since STM, she has learned an ad hoc negotiating team has been assembled by BOS to go forward with attempting purchase of the mountain without the use of eminent domain. Ms. Vogt had been asked by Planning Board Chairman Alan Pease to be on the committee, but she felt it was inappropriate since she wanted to maintain FinCom's objectivity on this issue. Mr. Pease had also said he felt Ms. Vogt's questions were good questions that needed answers. He wants to meet with FinCom to find out what FinCom needs from the negotiating committee as it goes forward in the process.

Discussion on Ms. Vogt's Report

Members continued discussion about the difficulties with the mountain purchase. Mr. Morey reiterated his concerns from last year that the owners will set a price higher than the town is willing to pay. Ms. Raymond noted that Mr. McCallum had indicated during the meeting that the goals of the two parties were not that far off. Ms. Vogt said she was hopeful BOS would not continue to keep FinCom in the dark about information we have requested.

Mr. Morey expressed his concerns that because of potential legal fees on this land deal, the town could be risking laying off of personnel to meet the costs.

Mr. Farley asked several questions about how legal counsel is contracted and paid. He was concerned that bills were not tendered in a timely manner so management could not project costs adequately. He said there should be statute providing for the submitting of bills within a business cycle.

Members reported that a line item for legal expenses, in FY01, of $25,000 was budgeted to cover all anticipated legal expenses for the fiscal year. In previous year, legal fees had exceeded this line amount, which FinCom had raised last year, and that additional payments came as extraordinary expenses out of Reserve Fund. In the past, bills have not been submitted in a timely matter and it was felt town did not have a lot of control over how bills were submitted for all legal work including town counsel, labor counsel, and, now, eminent domain counsel. Mr. Morey said that basically Town Counsel is paid a retainer for being on call to the town and charges according to hours worked on each project. Mr. Morey said he was concerned by the flavor of the whole project. Town Counsel was clearly not happy and last year she was praised for setting up the process of buying the mountain by working pro bono. Something has clearly happened to that relationship since the start.

Mr. Nash said he felt that in the case of the mountain purchase, it seemed both sides were less than credible on the issues.

Minutes of Previous Meetings

Minutes of November 9 were unanimously accepted as written.

Treasurer Concerns

Town Treasurer Lillian Whitney asked permission to speak with the committee. She said she had cash flow problems with the payroll on the current week's warrant. Because of the election wages, many town employees had asked for overtime wages to count ballots and she was also worried about a stipend she'd been requested to pay in full before the end of the calendar year, rather than spreading it across the fiscal year. Members said they felt she was right to spread the stipend over the year, but there was no consensus on how she should proceed without more detailed information.

Finance Committee Expense

FinCom approved unanimously paying $44.94 from expenses to cover cost of new file cabinet. Ms. Vogt reported that she and Ms. Roberts both had keys for the cabinet and had brought in background files for the committee from files they'd been keeping at home.

Budget Timeframes and Process

Ms. Vogt reported that the town was about on target for the state guidelines for budget preparation and approval. Most department heads had submitted their line items requests by the Nov 15 deadline and she and Ms. Raymond were in process of keying them into a FinCom spreadsheet in order to analyze the numbers.

Ms. Vogt then led a discussion on how FinCom should proceed, asking members to think of questions they would ask on creating guidelines for spending in the next fiscal year. Suggestions included:

What are the trends in revenue and expenses? Why are individual departments needing exceptional increases (e.g., a catch-up request)? What are priorities for the town going forward over the next several years? What do we need for equipment now? What are the consequences of state income tax being rolled back? What are department heads' strategies for replacing equipment and maintaining inventories? Why not do it the way we've always done it: looking at individual requests on an individual basis and comparing it to the whole?

After considerable discussion on FinCom's desire not to micromanage departments, but rather help department heads manage more effectively, Ms. Vogt suggested FinCom begin by looking at the overall numbers in the budget before starting the process of making specific decisions. Members agreed to the following initial research responsibilities, bringing reports to the next meeting:

Look at percent increases for each line item: Ms. Vogt/Ms. Raymond

Look into the merit of leasing equipment: Mr. Morey

Look over all departmental requests and trying to determine why each increase was requested: Mr. Farley, Mr. Nash, Ms. Roberts.

Meeting Schedule

December meetings will be Dec 4 and Dec 18 at 6:45 pm.

Assistant Secretary for Budget Process

Mr. Nash agreed to divide minute-taking responsibilities for the heavier budget meeting schedules. He accepted the new title of "Assistant Secretary for the Budget Process." Ms. Raymond also agreed to facilitate the department-head meetings using a written flip chart. It was felt this would not only help focus those meetings, but charts could also be used as meeting notes for transcription into minutes.

DLS Financial Management Review

Ms. Vogt reported that the DLS had not finished their report. It was taking them much longer than anticipated to formalize a report to the town and they were still involved in research. It was hoped the report might help focus budget discussions, particularly on priorities for staffing in the new fiscal year.

Capital Planning

Ms. Roberts reported that Clarke Rowell, financial advisor from Unibank, had met with Town Administrator Sanders and herself to discuss the overview and structure of the first draft of town's capital plan. Mr. Rowell was charging for his time, but at a reduced rate and paid out of Town Administrator's administration and operations line, in hopes that his firm would get a financial management contract from us when and if we go out for bonding. Ms. Roberts felt the meeting was profitable since Mr. Rowell was knowledgeable about town finance and made excellent suggestions for the plan structure. He was working on inputting his edits into the chapter. Next step in the plan will be for Ms. Sanders and Ms. Roberts to bring BOS and FinCom together to discuss how to proceed from here. Ms. Roberts guessed this would be sometime in January.

Meeting adjourned at 8:40 pm.

Respectfully submitted,

Peggy Roberts,

Clerk