BOARD OF FINANCE
SEPTEMBER 26, 2006
SPECIAL MEETING
1. CALL TO ORDER
The Special Meeting of the Board of Finance was called to order at 6:32 P.M. in the Lower Level Conference Room of the Town Hall, 933 Hopmeadow Street, Simsbury, Connecticut. The following members were present: Chairman Paul Henault, Peter Askham, Nicholas Mason, and Kevin North. Also in attendance were Finance Director/Treasurer Kevin Kane and other interested parties.
Mr. Askham made a motion to move Item 1 (Approval of Minutes) on the scheduled agenda to be the last item on the agenda. Mr. North seconded the motion and it passed 4-0.
Mr. North made a motion to adjourn to Executive Session for purposes of a discussion on the settlement of a pending claim pursuant to Connecticut General Statutes section 1-200(6)(b). Mr. Askham seconded the motion and it passed 4-0. Members Candace Fitzpatrick and Anita Mielert joined the meeting at this point.
2. EXECUTIVE SESSION
The Board adjourned to Executive Session at 6:35 PM, asking Brian Smith, representative of Robinson & Cole, and Hiram Peck, Acting Director of Community Planning & Development, to remain.
Ms. Fitzpatrick made a motion to resume the Special Meeting at 7:35 PM and Mr. Askham seconded the motion and it passed unanimously.
3. FISCAL YEAR 2005/06 UN-AUDITED FINANCIALS
Mr. Henault referred to Mr. Kane’s memorandum dated September 21, 2006 (Addendum I) and asked him to review it with the Board. Mr. Kane stated that actual revenues exceeded expenditures by approximately $900,000 and that the year ended with an approximately $8.9 million Undesignated Fund Balance, or 11.4% of budgeted expenditures. It was noted that the Simsbury Farms Fund Balance was essentially at zero.
Mr. Mason asked why the budget is changed as it implies that good planning has happened when, in fact, there were four reasonably sized transactions that were added during the year that were not planned for. He felt that the budget numbers should remain the same for financial reporting purposes. Mr. Kane responded that, under basic fund accounting principles as prescribed by GASB, any time money is approved to be moved from reserves, the budget gets revised. Mr. Henault noted that there was very much discussion around the projects for which the transfers were made and, therefore, questioned the assumption that they were “not planned for”. Mr. Kane added that, once voters approve an expenditure via Town Meeting or referendum, there is a mechanism that requires that an accounting transfer be made in the
General Fund.
Mr. Askham asked about the “Assessments (Water- NEW)” line item and Mr. Kane responded that he thought that this was a one time item and that there would not be much more coming through, although he would verify that with the Town Engineer.
Mr. Mason asked if it would be necessary to replenish the Fund Balance for Simsbury Farms and Mr. Kane stated that there is concern that it will go negative and that the First Selectman is aware of the situation. Mr. Askham asked if the sewer plant is done and when debt repayments would commence. Mr. Kane replied that it is mostly complete and that debt repayment will begin within the 2007/08 budget and will be a sizeable amount.
Mr. Henault asked Mr. Kane to have Mr. Holden prepare preliminary financial results for the Board of Education and mail them out to the Board members prior to their next meeting.
4. DISCUSSION ON SPECIAL TOWN MEETING/REFERENDUM – ETHEL WALKER LAND PURCHASE
Mr. Henault noted that the date has been set for the Special Town Meeting on October 17, 2006. He noted that there is no information yet on the revised contract wording, but the assumption is that it will be done prior to the October 17th meeting.
5. DISCUSSION ON BOE/BOS/BOF JOINT MEETING
Mr. Henault indicated that Mr. Askham, Ms. Fitzpatrick, Mr. Mason, Mr. North and Ms. Mielert were all going to try and attend the special joint meeting of the Board of Education, Board of Selectmen and Board of Finance that has been scheduled for tomorrow evening, September 27, 2006, the purpose of which is to get a head start on 2007/08 budget planning and address how the Ethel Walker purchase, if approved at referendum, would affect their projects.
6. DISCUSSION ON FISCAL 2007/08 BUDGET PLANNING
Mr. Henault asked for the Board members’ thoughts on possibly adding a Special Meeting with public audience or including public audience on the agenda of a scheduled Regular Meeting earlier in the budget process, such as October, as the Public Hearings that are held in March are at the tail end of a process that starts months before. Mr. North thought that having public audience earlier in the process was a good idea, but that it would be more productive to have in November, after the results of the referendum are known. Ms. Mielert stated that years ago the Board of Selectmen held a series of public hearings at area elementary schools at which residents requested better schools and that they were willing to pay more for that. The budgets were raised accordingly and then voted down at referendum. She felt that
it would be better to hold public hearings at a “neutral venue” and not within the schools. Ms. Mielert also stated that she thought there should be public audience at every meeting. Ms. Fitzpatrick thought either a Regular Meeting agenda item or a Special Meeting would both serve the purpose and that it was a good idea.
Mr. North asked if it was known when the results of the survey that is being commissioned by the Town would be known as there are questions on it that would be of particular interest to the Board. Mr. Henault stated that it was not known when these results would be available.
Mr. Askham asked if the GASB 45 obligation would be funded and included in the upcoming budgets. Mr. Mason stated that it had been discussed about having a joint BOE/BOF meeting in order to discuss the various issues involved in setting up the fund. Mr. Henault suggested that Mr. Askham bring that up at tomorrow’s joint meeting. Mr. Kane stated that he was in the process of contacting an attorney and working up the costs involved in establishing the fund to present to the Board at a future meeting.
Ms. Mielert stated that she thought there would be substantial movement about health care and, in particular, universal health care on a statewide and national level over the next five years and asked if it was possible that the State could absorb these funds if they were no longer needed. Mr. Kane stated that the funding of this liability is a new accounting standard that was set by GASB and, as such, will not be impacted by political opinions. Mr. Askham stated that, although the required amount to be funded may decrease, the need for money to be in the trust will never go away. Mr. Mason noted that current out-of-pocket retiree costs are approximately $300,000-$400,000 and that amount will eventually come out of this trust and change the way those costs are accounted for. Mr. Askham also noted that different
contract negotiations will also have an impact on the funding that is required.
Ms. Fitzpatrick noted that the next scheduled Board of Finance meeting is on October 17, 2006, which coincides with the Special Town Meeting. The Board agreed that the Regular Meeting should be rescheduled as a Special Meeting that begins at 6:00 PM.
7. APPROVE MINUTES
Ms. Fitzpatrick made a motion to approve the minutes of the July 18, 2006 Regular Meeting and Ms. Mielert seconded the motion. Mr. Mason noted that a statement attributed to “Mr. North” should be corrected to be “Mr. Kane” on page 4. The motion to approve the minutes as amended passed unanimously.
Ms. Fitzpatrick made a motion to approve the minutes of the July 26, 2006 Special Meeting and Ms. Mielert seconded the motion. Mr. Henault noted that a motion in the minutes passed “5-1” rather than “11-1” as only the Board of Finance voted. The motion to approve the minutes as amended passed unanimously.
Mr. Mason made a motion to approve the minutes of the August 15, 2006 Regular Meeting and Ms. Fitzpatrick seconded the motion. Mr. Henault requested that his slide presentation be attached to the minutes as an addendum. The motion to approve the minutes with attachment passed unanimously.
Mr. North made a motion to approve the minutes of the August 31, 2006 Special Meeting and Mr. Mason seconded the motion. Ms. Fitzpatrick asked that the minutes be amended to reflect that she had been absent due to a family emergency that required her presence out of town. The motion to approve the minutes as amended passed unanimously.
8. ADJOURNMENT
Mr. North made a motion to adjourn the meeting at 8:15 PM. Ms. Fitzpatrick seconded the motion and it passed unanimously.
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Paul Henault, Chairman Debra L. Sweeney, Clerk
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