BOARD OF FINANCE
OCTOBER 17, 2006
SPECIAL MEETING
1. CALL TO ORDER
The Special Meeting of the Board of Finance was called to order at 6:11 P.M. in Conference Room D-172 at Simsbury High School. The following members were present: Chairman Paul Henault, Peter Askham, Nicholas Mason, Anita Mielert and Kevin North. Also in attendance were Finance Director/Treasurer Kevin Kane and other interested parties.
2. APPROVE MINUTES
Ms. Mielert made a motion to approve the minutes of the September 26, 2006 Special Meeting and Mr. Mason seconded the motion. Mr. Mason noted that there was an action item in the minutes that had not been responded to, namely a request for an updated financial report from Mr. Holden of the Board of Education. Ms. Mielert asked that her comments on page 3 be clarified to reflect that she was referring to “health care and universal health care in particular”. The motion to approve the minutes as amended passed unanimously.
3. TRANSFER FROM RESERVES
Ms. Mielert made a motion to authorize a supplemental appropriation in the amount of $30,000 pursuant to Section 908(a) of the Town Charter to fund expenditure authorizations as enumerated in Town Engineer Richard Sawitzke’s letter to the Board of Selectmen dated September 22, 2006 (Addendum I). Mr. Mason seconded the motion.
Ms. Mielert stated that it was her understanding that most of these expenditures would be reimbursed by state grants and that it was necessary to first spend the money in order to be reimbursed. The motion passed 5-0.
Mr. Kane joined the meeting at this point.
4. REPORT FROM FINANCE DIRECTOR ON SENIOR TAX RELIEF COMMITTEE
As Mr. Kane’s presence was required elsewhere in connection with the Town Meeting at 7:00 PM, Mr. Mason made a motion to move up Item 4 on the agenda to be the next item. Ms. Mielert seconded the motion and it passed 5-0.
Mr. Kane reported that the Senior Tax Relief Committee, consisting of 14 members, was separated into two sub-committees. One is working on the original proposal that was put before the Board of Selectmen in June and the second is reviewing a “revenue neutral” proposal. The first proposal focuses on a 2% cap on annual tax increases for qualified taxpayers, while the second plan works similar to a reverse mortgage where a portion of taxes is deferred at an assumed interest rate and accumulates like a loan. A corresponding lien on the property was proposed, but the seniors opposed that.
Ms. Mielert suggested that, before either committee goes too far, they research the legality of any of their proposals as the State sets certain limits and Mr. Kane concurred that his suggestion to the committee members was that they first check with Town counsel as to the legality of any proposal before moving forward and he also suggested that they make some form of presentation to the Board of Finance and solicit their feedback so that they do not waste their time. Mr. North asked if any attempt had been made to measure the tax shift. Mr. Kane replied that it is his understanding that State law prohibits more than 10% shifting from one group to another, which would be approximately $7 million.
Mr. Askham asked for a listing of what other towns have done. Mr. Mason indicated that the Senior Tax Relief Committee did take that into account when they were gathering information initially.
5. FISCAL YEAR 2007/08 BUDGETING
Mr. Henault asked for the Board members’ feedback on any budget issues that are of concern to them. Mr. Mason stated that the Board never resolved their discussion as to whether to hold public audience and Mr. Henault stated that it was his understanding that the Board had agreed to have public audience at their November meeting, after the results of the referendum are known. Ms. Mielert reiterated her desire to have public audience at each Board meeting.
Mr. Askham asked if they were going to have a three-way meeting of Board of Selectmen/Board of Education/Board of Finance.
Mr. Mason stated that the Board should make a formal request of both Boards to revisit their six-year capital plans and Mr. Henault stated that it would be best for them to do so after the results of the referendum are known.
Mr. Askham asked to have reports on the current year budgets and any line item problems of which the Board should be aware. Mr. Mason concurred and stated that the Board of late has been dealing with a large number of items without input from the Board of Selectmen as to their priorities. Ms. Mielert added that there also could be a number of changes on approved projects, such as the library, which are getting ready for bidding and the Board should know their effect on debt service and if any additional authorization items will be needed.
Mr. North stated that he would like a better understanding of the GASB 45 funding status. He noted that the funding required may not be as dramatic as was originally suggested by the actuarial study and that this may be the year for the actual establishment of and investment in the trust. Mr. North felt that the initial responsibilities should not be by an appointed board, but rather should be the responsibility of the Board of Finance, with the responsibility perhaps being transferred to an appointed board at a later date. Mr. North stated that the Town should focus on engaging an investment counselor as investment companies are experiencing an upsurge in requests for counseling in this area and may be less available as a result and Simsbury needs to be one of the first in line. Mr. Mason also pointed out that these
assets should not be invested in the same fashion as pension assets. Mr. North further noted that, once the trust is established, the funds are no longer limited to money market funds.
6. DISCUSSION ON OCTOBER 17TH SPECIAL TOWN MEETING
Mr. Henault stated that, at his presentation at the Special Town Meeting regarding the Ethel Walker land purchases, he plans on reviewing the tax impact of Resolution 1 (the land purchase) and Resolution 2 (the option) making certain assumptions and how much will have to be bonded based upon cash on hand.
He stated that he will not include grants on the 2012 portion as there are currently none in hand. He will also review the impact on reserves as well as provide projections as to anticipated revenue if new homes were to be built on the site. He also noted that the Town Moderator has requested that the entire presentation from all Town representatives be kept within an hour, followed by public audience. The Trust for Public Land will not make a presentation as the Moderator felt they should not be there as they are party to one of the proposed contracts.
Mr. North asked if the parties are in agreement subject to signature, as there currently is no contract in place and Mr. Henault stated that he did not know. Mr. North stated that he felt the vote being taken tonight on the $1 million option is inappropriate as he views this as one contract with two pieces and should go to referendum as such. He stated that he did not understand the logic of breaking out the second piece of a contract for approval at a Town Meeting. He added that he had serious questions as to whether it is a point of order. Ms. Mielert thought that it might have something to do with the way bond counsel reads the Town Charter.
Mr. Askham asked if there would be any mention of pending grants and Mr. Henault stated that his presentation would only reflect the $460,000 of grants that are currently approved. Ms. Mielert asked if anyone had any knowledge of another grant being approved prior to the vote and Mr. Henault stated that he was not aware of any such approval. Mr. Askham asked if there would be any reports on the current status of the Trust for Public Land’s fundraising and Mr. Henault stated that there would not.
7. ADJOURNMENT
Mr. Mason made a motion to adjourn the meeting at 6:47 PM. Mr. Askham seconded the motion and it passed 5-0.
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Paul Henault, Chairman Debra L. Sweeney, Clerk
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