Simsbury, CT - Board of Finance

The Regular Meeting of the Board of Finance was called to order at 6:04 P.M. in the Main Meeting Room of the Simsbury Town Offices. The following members were present: Paul Henault, Peter Askham, Candace Fitzpatrick, Nicholas Mason, Anita Mielert and Kevin North. Also present were Director of Finance Kevin Kane, Board of Education Business Manager David Holden, First Selectman Mary Glassman, Superintendent of Schools, Diane Ullman, Board of Education member Charles Moret, Water Pollution Control Superintendent James Clifton, Chief of Police Peter Ingvertsen, Library Director Susan Bullock, Recreation Director Gerard Toner, Culture Parks & Recreation Commission Member Harry Ryan and other interested parties.

Mr. Moret reviewed the Board of Education’s proposed capital projects for 2008/09, which totaled $24.4 million, noting that many of the BOE’s meetings had been devoted to the capital plan and looking at the needs of the district over the next six years and trying to prioritize them. The projects proposed included boiler replacements at Henry James and Tariffville Schools and roof replacements at Latimer Lane and Tootin Hills Schools. Additional projects included improvements to network technology (as the old infrastructure is unable to accommodate heavy usage and is causing breakdowns in instructional programs), and main office reconfigurations at Henry James and Latimer Lane due to security concerns.

Ms. Mielert asked if the roof projects, which would qualify for school building grants, had to be approved one year in advance like the other major projects. Mr. Holden indicated that the funding would have to be approved in May and then application would be made prior to June 30^th in order to receive a State grant commitment for the following May. Ms. Mielert asked why the boiler replacement and network technology improvement projects at Tariffville School were not included in the school renovation plan that is currently being bonded. Mr. Holden stated that it does not appear that there is sufficient funding in the initial appropriation to accomplish the boiler replacement. He added that boiler replacements and HVAC improvements are considered routine repair and maintenance and, as such, are not eligible for state construction grant assistance. The network technology improvements involve running fiber-optic lines from Tootin Hills, Tariffville and Squadron Line to the closest school that has a fiber-optic connection along telephones on the streets.

Mr. Askham asked Mr. Kane if the bonding projections that were provided to the Board and were based on the current six-year plan anticipated any bonding for new expenditures. Mr. Kane responded that the projections did not include any new expenditures for at least two years, but noted that projecting the timing of bonding needs involves a certain amount of guesswork. His primary concern was that as of June 30^th all projects are covered and made whole.

Mr. Askham asked Mr. Holden which of the roof projects was more urgent and Mr. Holden responded that it would be Tootin Hills, as it is 22 years old, whereas the Latimer Lane roof is 21 years old. Mr. Mason asked if significant amounts were being spent on maintaining the roofs at this point and Mr. Holden indicated that about $12,000 was spent last year.

Mr. North asked if energy savings could be expected due to new technology in connection with the boiler replacements and Mr. Holden stated that, although they do not have a quantifiable estimate, they have realized savings in the range of 10-12% at other schools where replacements have already occurred.

Mr. Henault noted that some projects that were previously on the six-year plan have been revalued, moved or are missing. Mr. Holden stated that a decision was made by Board of Education this year to remove the expenses of air conditioning out of several projects and that some projects were then moved forward or eliminated. Mr. Henault stated that this plan, along with the plan from the Board of Selectmen, is very good; nevertheless, from a fiscal standpoint, he thought that the plan was pretty impractical and would need to be examined closely by the Board.

Ms. Glassman reviewed Board of Selectmen’s proposed capital projects for 2008/09, noting that top priority has to be given to improvements at Eno Hall as the Town was put on notice several years back that there are various fire and safety concerns and, as a result, has had to reduce the amount of public use in the building. She also noted that Eno Hall houses the Town’s Senior Center and that she has a log of accident reports indicating that accidents involving falls are increasing. There are no sprinklers in the building and the front walkway is continuing to erode. She indicated that the Board of Selectmen felt very strongly that all these issues needed to be addressed before any new projects are taken on.

Ms. Glassman also noted that the Town has been trying actively to purchase the Gersten property for many years and has finally gotten the landowner’s approval. The total cost for the project is $700,000. She noted that the Town has $600,000 in grant money that it has not collected going back to 2002. It is expected that those revenues will come to the Town in March. The DEP has agreed that, relative to closing on the Gersten property purchase, the Town will go to the table with $350,000 and not the full $700,000 and then seek reimbursement, as has been the previous practice that has not worked very well as there have been serious lags in the reimbursement process.

Ms. Glassman stated that the Streetscape/Route 167 project has been approved previously and the Town has not gone forward with the project as the Route 10 State improvements have not been ready. However, the Town has now been notified by the State that the Route 10/Drake Hill intersection will be ready for construction next summer and the Town’s portion of the project would be to continue the lighting and improvements along Hopmeadow Street as well as construct a turning lane on Drake Hill Road to ease some of the traffic and to provide some pedestrian improvements, particularly at One West Street where sidewalks will be provided near the senior complex.

Additional projects, such as water extensions, sewer extensions and the rehabilitation of the South Pump station, would be covered by user fee reimbursements and would not increase the Town’s debt levels. Finally, improvements at Simsbury Farms are needed to relocate the entry to the golf course as there is a safety issue regarding children at the playground. The project has been delayed many times and a grant request was filed today requesting funding for the project and Ms. Glassman expected to know shortly whether it wouldl need to be funded at all.

Mr. Askham asked about the approval process for the Griffin land purchase. Ms. Glassman responded that the settlement was made in November and the Town received an update in January. The Town needs to decide if it wishes to purchase the last piece of property as part of the settlement or allow it to revert back to the allowable number of residential units to be built. Ms. Glassman indicated that any future use of the property is very restricted in that no structures may be built on it and it must remain as passive open space, although soccer fields or the like might be allowed. Ms. Fitzpatrick asked if agricultural use would be allowed and Ms. Glassman responded that it is currently unclear. Mr. Henault asked about State grants and Ms. Glassman stated that there is no guarantee and nothing is currently before the Bond Commission.

Mr. Henault noted that the GIS mapping project has been on the capital plan for quite some time. Ms. Glassman stated that the Town does not have the in-house capability to do an analysis and that a CRCOG grant has just been received to join with other towns with regards to implementing a GIS system. Mr. Henault asked about the removal of a $500,000 item for the Economic Development Plan. Ms. Glassman stated that there were no guidelines for the Plan indicating to the taxpayers as to how or where it would be used so it was removed.

Mr. Henault stated that the challenge facing the Board of Finance is that this year’s total requests alone are for $19.9 million and last year’s were for $9.4 million. The entire six-year capital plan encompasses $56 million of projects and, as of last year, it was $31 million. He noted that there is a huge gap between the requests vs. what can actually be done. Additionally, the Board has a 7% debt guideline with respect to debt service and none of the requests fit within that guideline and, in essence, there is no capital available this year.

Although there are very good intentions behind all the projects, Mr. Henault stated that the issue becomes what is practical and what the Board is comfortable with putting before the voters. Mr. Henault stated that the Board’s options are to move the proposals on to public hearing as is, to ask the two Boards to adjust their figures and address them at another meeting, or to refuse to hear any capital projects and refuse to move any projects on to public hearing.

The Board questioned Ms. Glassman about the proposed improvements to Eno Hall and the feasibility of phasing the project. Mr. North questioned the absence of recurring maintenance in the operating budget. Ms. Glassman emphasized that a recurrent theme in all of the Board of Selectmen’s budget process was to take care of what the Town has before starting any new projects. The Town buildings, which were inventoried and studied in 1998, have not yet been put on a program of regular maintenance.

The Board discussed at length with Mr. Kane his debt service projections, the effects of interest rates on those projections and the timing of when projects are approved and when they are actually bonded. Mr. North stated that there is a gap of roughly $12 million in the six-year plan between what can be afforded while staying within the 7% debt policy and what has been proposed. Mr. Askham thought that there would be about $1.5 million in reserves that could be used towards capital, based on Mr. Kane’s projections.

Mr. North stated that he wished to adhere to the debt policy as closely as possible and, therefore, was inclined to look only at proposed projects that could be funded out of the undesignated fund balance up to roughly $2.4 million. He stated that the guidance that was given to the Boards prior to this evening’s presentation of the capital plan was within the same scope. He thought that the two roof projects could be phased over two years, the boiler projects are important as is the Eno Hall project, but there would be no reason that those improvements could not be phased over several years as well. He shared Ms. Mielert’s concern over the lack of ongoing maintenance in the Board of Selectmen’s operating budget.

Ms. Fitzpatrick concurred and stated that the Board has taken the same approach throughout her tenure, namely doing its best to adhere to the debt policy and keeping the reserves at a healthy level that does not impact the Town’s bond rating and allows it to have an emergency reserve. She noted that one exception was made in order to accommodate the high school project and that is why the debt policy is currently being exceeded.

Ms. Mielert stated that $550,000 is the amount to sprinkler Eno Hall. The absence of sprinklers is what limits use of the building and must be the first item to be addressed should the project be phased. Mr. North concurred and added that the $550,000, when coupled with $200,000 in grants and Eno funds of $200,000, more than 50% of the total scope of the project presented could feasibly be accomplished. He also felt that it was important that, although acknowledging the importance of the historic nature of the building, the project team should be instructed to value engineer every phase of this historic renovation so as to consider modern materials that have the same aesthetic result.

Mr. Mason stated that he thought that it is important that the Board of Finance give the two Boards some direction. Based on Mr. Kane’s projections, Ms. Fitzpatrick thought that the Board might be able to approve $4.2 million of capital. The Board explored the possibility of asking the two Boards to rework their six-year plans. Mr. Henault stated that he did not want to be in the position of selecting projects. However, Mr. Kane stated that there is a tight timeline and that the Board will need to have an acceptable amount in place by March 24^th. Ms. Glassman stated that, if the Board of Selectmen is given an amount, they will prioritize their projects to accommodate that number.

Mr. Kane stated that the Board should be comfortable with and support any projects that come before them and not just rubber stamp projects that fit within a given amount. Mr. Mason stated that the Boards have expressed their priorities. Ms. Fitzpatrick thought that the Tootin Hills roof project was important. She had concerns about not accommodating the Griffin land purchase, but was not willing to commit reserves to do so and, if bonding was not an option, was not sure how it was doable as the Board would have to commit to the entire amount, regardless of how it is actually paid for. The Board discussed various combinations of reserves and bonding to accommodate various projects, noting that the water extensions, the sewer extensions and the pump station renovation would not have an effect on the debt policy.

Ms. Mielert made a motion to move on to Public Hearing the Streetscape project for $325,000, the Firetown/Barndoor Hills land purchase of $2.7 million and the Tootin Hills roof replacement project, to be funded by bonding, and $700,000 for HVAC/boiler replacements, $950,000 for Eno Hall renovations (with no more than $550,000 to be bonded) and the Laurel Hill/Gersten property purchase of $370,000 to be funded out of reserves. Also, as they do not affect the debt policy, the water extensions, sewer extensions and rehabilitation of the South Pump Station would also be moved forward. Ms. Fitzpatrick seconded the motion.

Mr. North stated that, although he supported the spirit of the motion, he did not support the sources of funding as he felt that the undesignated fund balance should be used towards projects that are high priority and of an emergency in nature. He felt that the projects that were more of this nature would be $600,000 for the Eno Hall renovations (sprinklers and walkway replacements and architectural sprinkler treatments), the net cost of the Tootin Hills roof ($880,250), and the two boiler replacements ($700,000), for a total net Town cost of $2,180,250 out of the undesignated fund balance. He felt that the other projects, were are less pressing, should be put before the voters as a referendum item.

Mr. Henault agreed with Mr. North and noted that his proposal accomplishes the same thing as Ms. Mielert’s motion, but preferred the way in which the projects were laid out in Mr. North’s scenario. He felt that the Town should comment on the land purchases. Ms. Fitzpatrick also agreed with Mr. North’s point.

Ms. Mielert made a motion to move the following capital projects on to Public Hearing: envisioning funding to come from bonding, the Firetown Road/Barndoor Hills land purchase, the Gersten property purchase, and the Streetscape improvements; envisioning funding to come from reserves, Eno Hall improvements in the amount of $600,000, the Tootin Hills roof replacement project in the amount of $880,250 and the boiler replacement projects at two schools totaling $700,000; and with funding to come from user fees, water extensions, sewer extensions and the rehabilitation of the South Pump Station. Ms. Fitzpatrick seconded the motion and it passed unanimously.

Ms. Glassman reviewed the proposed operating budget for the Board of Selectmen for 2008/09, noting that initial budget requests came in at 9.62% and were reduced to 3.48% in order to comply with the 3.5% guideline that was set by the Board of Finance. She indicated that the items that were removed included requests for a number of new positions (Risk Manager, Building Dept. staff, two additional custodians for the Library) as well as certain positions and materials at the Library. Additional staff positions that were included in the budget are an additional Police Officer, a Dispatcher, a part-time Police Records Clerk and a Public Works Director. A survey of officers in other towns disclosed that Simsbury is significantly lower in terms of the number of officers it has relative to is population size and this was determined to be a public health and safety issue. Ms. Glassman stated that, given the number of buildings that require maintenance, the number of projects and roads, and supervision of the Highway Dept. staff, a professional manager is essentially needed.

Ms. Glassman indicated that there were anticipated increases in insurance and utilities and these estimates were made by professional advisors and Mr. Kane. She also indicated that the Board of Selectmen had voted against the charette recommendation at their meeting the prior evening. She noted that the proposed budget also included expansion of public swim times at the Town’s pools as well as some additional reference materials for the Library.

Relative to Capital Nonrecurring, there are $500,000 of maintenance-type projects consistent with the recurring theme of taking care of what the Town already has in place. She noted that the Town currently has no regular maintenance plan for its properties and no real inventory of what state its buildings are in or what needs to be done, no road paving management plan, no handle on how many vehicles are out for personal use and no accountability on how gas is used by Town employees and that there is a lot of work to be done in these areas. Mr. North commented that he hopes that the initiative to hire a new Public Works Director includes a job description that has a more financial and less operational emphasis. He also thought that the skills required to manage a physical plant are different from the skills needed to manage an infrastructure. Ms. Glassman stated that they have been working with the Town of Avon in this regard as they already have many management programs in place. Mr. North applauded the initiative in this area.

Mr. Askham asked about Library personnel, noting that that number remained unchanged, and yet there was a significant increase in the part-time budget. Ms. Bullock explained that the increase was due to the three-year Hartford Foundation grant, which will fund teaching operations at the technology wing.

Mr. North objected to the relocation of conference/seminar expense out of the respective cost centers into its own cost center, stating that it made the Board of Finance’s job more difficult in terms of monitoring the expense of various cost centers. Ms. Glassman stated that the Board of Selectmen wanted to do this for one year so as to get a handle on actual costs that were needed for staff to retain certifications for future budgeting purposes.

Mr. Henault asked if the increase in fees from the Building Department was realistic, given the current housing market. Mr. Kane stated that the fee projection was based on a five-year average. Mr. Henault also noted that it will be important to keep an eye on interest revenue as interest rates start dipping.

Ms. Fitzpatrick stated that she had sent an e-mail to the Board regarding the performance measures project and asked if the Board would be amenable to her forwarding this e-mail to the First Selectman as action was needed as to whether or not to move forward. Ms. Fitzpatrick stated that she had concerns relative to the project that centered on the research methodology and that there is no fixed dollar amount of exposure for the Town. According to the terms of the agreement, the Town is required to conduct citizen focus groups and surveys and none of these items are quantified. Ms. Fitzpatrick’s attempts to get them quantified were unsuccessful. Therefore, although she thought it was a worthy endeavor, she had concerns about the management of the project and thought that perhaps this program was not the best vehicle. The Board concurred that Ms. Fitzpatrick should forward her e-mail to Ms. Glassman, who indicated that the Board of Selectmen would not take any action based solely on the e-mail and that formal direction will need to come from the Board of Finance.

Mr. North asked Ms. Glassman if she could request that the Town’s technology staff investigate “push technology” relative to the Town e-mail boxes so that, when mail arrives in them, it gets pushed out to the members’ personal e-mail accounts. Ms. Glassman thought that this procedure ran counter to the Freedom of Information policy and wanted to encourage use of the Town e-mail. Mr. North stated that he did not have a problem responding through the Town system, but that timely notification as to there being a message in the mailboxes was problematic for the members. Ms. Glassman stated that she would follow up. Mr. Mason asked for additional organizational features in the mailboxes as well that allow them to set up folders, etc. The current form only allows for one long list that the members can only delete.