Simsbury, CT - April 4, 2006

The Board of Finance Public Hearing on the 2006/07 Operating Budgets was called to order at 7:30 PM in the Simsbury High School auditorium. The following members were present: Chairman/Moderator Paul Henault, Peter Askham, Nicholas Mason, Kevin North and Anita Mielert. Board member Candace Fitzpatrick was absent due to illness. Also present were Board of Education Member Jack Sennott, Board of Education Business Manager David Holden, Finance Director/Treasurer Kevin Kane, Superintendent of Schools Diane Ullman, First Selectman Thomas Vincent and other interested parties.

Mr. Henault introduced himself, the members of the Board of Finance and all others who would be presenting the budgets and answering subsequent questions. He reviewed the Public Hearing agenda, the budget process, the role of the BOF and the purpose of Public Hearings which are required by Town Charter.

Mr. Henault stated that the BOF asked both boards to come in with a budget increase amount that was less than 5.6%. He noted that the Board of Selectmen came in at 5.25% and the Board of Education came in at 5.6%. He also noted that a $600,000 set aside for the GASB 43/45 requirement drove the percentage up to 5.88%. He added that the projected mill rate is 36.1, an increase of 1.1 mills or 3.12%. He pointed out that favorable investment rates and grand list growth offset the direct equation of a 5.88% budget increase resulting in a tax increase of the same percent.

Mr. Henault gave an overview of the new GASB 43/45 accounting standard which requires governmental entities to account for their post-employment health benefits, much the same as has been required in the private sector. The Town, which has previously used a “pay as you go” method with regards to retirees’ health benefits, must now accrue today what the cost of all future medical benefits will be. The Town Actuary has indicated that $2.1 million must be set aside to cover this obligation. Mr. Henault noted that, by easing into this amount in advance of the required implementation date, Simsbury is well ahead of other towns as well as the State, which faces a $20 billion obligation.

Mr. Vincent thanked the following people who helped put the 2006/07 BOS budget together: Mr. Kane, Department Heads, Deputy First Selectman Joel Mandell, John Hampton and the other members of the BOS not present. He stated that the BOS budget is $16,398,646, an increase of $817,683 or 5.25%. He noted that the initial budget requests came in at an increase of 7.11%, but were pared down to meet the 5.6% guideline established by the BOF. The Board of Selectmen budget represents 21% of the total Town budget and 22.4% of the additional dollars. He also stated that the four Special Revenue Funds budgets are: Sewer Treatment Plant - $1,851,923; Residential Rental Properties - $57,427; Dog Fund - $73,333; Simsbury Farms / Special Programs - $1,657,005. He added that the Capital & Nonrecurring Fund budget is $1,159,420.

Mr. Sennott thanked Dr. Ullman, Mr. Holden and the administration for their hard work in putting this budget together. Mr. Sennott stated that the BOE Public School budget request is $54,980,263, representing $2,915,620 in new dollars or a 5.6% increase. He gave an overview of the budget development process, which involved over 18 different meetings beginning in September as well as the budget development guidelines which include the class size guidelines. Top priority was given to reducing class size, increasing academic and support services to students and supporting ongoing curriculum development and professional development. Mr. Sennott noted that major factors influencing the budget included fixed costs (contracts, fuel, electricity, maintenance for additional square footage at the high school, and increased pension and medical costs), as well as preparation for the Fall 2006 NEASC team visit at Simsbury High, ongoing work to define a comprehensive high school, middle and elementary school focused work in literacy, mathematics and science, and building maintenance needs.

Mr. Sennott noted that, although education is a “people business” and that salaries represent almost 70% of total operating costs, the salary expense is not what is primarily driving the increase. The salary increase is slightly under 4%, while the other 31% of the other costs are going up over 9%; therefore, 30% of their budget is driving over 50% of their total increase. Mr. Sennott noted that enrollment has increased by 631 students over the past 10 years, which is four times faster than the Town’s population has grown. However, future enrollment is expected to decrease slightly. Mr. Sennott gave a “value per dollar” summary, noting that, although the per pupil expenditures for Simsbury rank low in comparison to other towns, the achievement results rank among the top performers.

Mr. Sennott then presented the Non-Public School budget which includes providing ancillary services to the four private schools in Simsbury (primarily busing and nursing). The increase in the current year is driven by a new State requirement that, in addition to those services, onsite psychological services must be provided. The budget request is $446,997 which is $63,445 in new dollars or a 16.5% increase.

Joan Coe, 26 Whitcomb Drive, stated that she felt the budget process involved the BOF determining what the Town can afford, sending this message on to the BOS and BOE, who then back into this number. As there is no public audience at BOF meetings, she felt the public has no input in determining this amount. She stated that what is needed are budget restraints rather than a “tax and spend” mentality. She also expressed concerns about decreases in revenue due to excessive “give-aways” by the Town. She encouraged the taxpayers to vote “no” at the referendum.

Mr. Henault commented that the BOF does have two Public Hearings per year and, since the BOS and the BOE both have Public Audience and most of the items that come before the BOF have been referred to them by those boards, it is assumed that the public has been heard. He also noted that the BOF takes letters and also has a website with an address for the public to address their comments. Finally, he noted that the ultimate authority on whether a budget should be approved or not is the voters as it goes to referendum.

Mr. Sennott responded that “pay for play” is an area on which the BOE spends a lot of time thinking about because it is a difficult choice to make, but with a finite budget, the decision must be made as to what is the best way to allocate costs on a use basis. He noted that although there are certainly towns with lower “pay for play” rates, there also are towns with higher rates. However, the priorities of the BOE must be at the classroom level and they try to keep any cuts away from the classroom as much as possible. With regards to salaries and benefits. Mr. Sennott noted that they are negotiated settlements and that the BOE is very pleased with the current teacher settlement in comparison with what the other competing districts got and he reiterated that the people costs are not what is driving the budget costs this year.

Julie Meyer, 3 East View Drive, asked how the projected tax increase of 3.8% that was discussed at earlier BOF meetings that she attended ended up being 3.12% in the current presentation. She also requested that the BOF consider a Public Audience earlier in the process as she did not feel that she can go to the BOS or the BOE and understand the process of the operating budgets and request information from them. Rather she has found by attending BOF meetings that the BOF is discussing those numbers and is looking at economic data and indicators and then giving to the BOS and the BOE an acceptable increase and that there is not an interactive role taking place between the boards. She also suggested that it be televised.

Mr. Henault responded that the Public Hearings are required by Charter. He felt that there would be a place early in the budget season (October or November) for a public audience at a BOF meeting. He also stated that they have no control over a meeting being televised and that it would be dependent upon SCTV having volunteers available.

Mr. Kane replied that the initial grand list projection used in January was a conservative number as there were several items in question at that time and the final numbers had not been filed. When the Assessor did file his grand list, the number ended up being higher than was originally projected. Mr. Henault also noted that the BOF sets the mill rate after the referendum and that the numbers being shown this evening are an estimate.

Mr. Holden stated that there are 30 Town-owned regular school buses and one Town-owned lift-gate handicapped bus. Additionally, the contractor has 10 vans, a minibus and a lift-gate bus. When school buses are purchased, it is put out to bid and those records are readily available. He noted that there is a value in the Town owning in that there is no registration fee, sales tax, or financing mark-up. There is a renewable five-year contract with Salter’s Express to maintain and operate those vehicles and there is a BOE subcommittee or ad hoc committee that reviews the status of that contract on a regular basis.

Julie Meyer, 3 East View Drive, commented that she was approached by an out-of-state prospective homebuyer that was interested in a home for sale in her neighborhood as to the quality of the Simsbury school district and that experience is an indicator that would support the 5.6% requested increase to maintain the high quality of the Simsbury school district as it clearly affects the home purchase decision.

Mr. Henault commented that there currently is a tax relief program in place for seniors with income below $35,000, but that it must be applied for and is not automatic and that there is also a veteran’s program in place as well for veterans and their spouses. He also noted that the BOS is currently reviewing other options.