BOARD OF FINANCE
MARCH 11, 2008
REGULAR MEETING
1. CALL TO ORDER
The Regular Meeting of the Board of Finance was called to order at 6:10 P.M. in the Simsbury High School Auditorium, 34 Farms Village Road, Simsbury, Connecticut. 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 (second half of the meeting), Board of Education Business Manager David Holden, Superintendent of Schools, Diane Ullman, Board of Education Chairman Jack Sennott and other interested parties.
Mr. Mason made a motion to move Item 1 on the Agenda (Approval of Minutes) to be the last item on the agenda. Mr. North seconded the motion and it passed unanimously.
2. BOARD OF EDUCATION 2008/09 BUDGET PRESENTATION (PURSUANT TO SECTION 905 OF THE TOWN CHARTER)
Mr. Sennott stated that the Board of Education had their regular meeting after the Board of Finance’s January 15th meeting, at which time they were given a firm guideline to hold any budget increase to 3.5%. The Board of Education acknowledged that the major issues driving that guideline were the Board of Finance’s attempts to mitigate the tax effects of the recent revaluation, the disproportionate share of the Town’s tax base that is born by residential taxpayers, and the Board of Finance’s 7% debt policy.
Mr. Sennott addressed the issue of the fact that student enrollment is projected to decline by 57% students next year and the resultant questions as to why the budget is not decreasing accordingly. He stated that the BOE’s budget process is based on core priorities from the classroom out (i.e., what is best for the student): class size guidelines, establishing student support systems and services and professional development for teachers. Mr. Sennott stated that the teacher settlement that was reached over the summer (and represents 70% of their budget costs) was for a 4.8% increase for 2008/09. Therefore, changes had to be made to the remaining 30% of the budget in order to achieve 3.5%. The Board, in turn, asked the Superintendent to make adjustments so as to realize the 3.5% guideline and, when
they reviewed the list, determined that anything less than a 4.2% increase would result in cuts to programs.
The Board discussed at length with Mr. Sennott and Ms. Ullman the declining enrollment statistics in conjunction with increased staffing statistics, which Mr. Sennott attributed to the BOE’s conscious effort to decrease classroom size, to introduce new programs and to address the increasing population of special needs students who require one-on-one attention, noting that the number of autistic students has increased from 35 to 57 over the last five years. Ms. Ullman added that the Board of Education’s priorities arise from parent requests and that staff reductions would put class size levels back to 2005 levels, setting their initiative back by two years.
Mr. North felt that there were currently no material violations of the classroom size guidelines. Mr. Henault stated that he felt the Board was struggling with the fact that the entire class size issue hinges on a 4.2% budget increase vs. a 3.5%, which equates to a $413,000 difference. When this amount is applied to a tax rate increase projection (excluding the effects of revaluation), it means the difference between a 3.25% increase to the taxpayer vs. a 2.71% tax increase. He feared that, if it is not established what will be done now relative to declining enrollment, then the Town will never see the Board of Education budget decline.
Mr. Askham stated that the COLA indicates a decline in peoples’ ability to pay and that increasing taxes absent a corresponding increase in salaries does not sit well with taxpayers. Mr. Sennott stated that this salary decline is not yet being seen in corporate earnings and that the BOE budget is designed towards protecting the assets and the school system is the crown jewel of the Town. Mr. Mason stated that, although there are some unknowns, both the budgets were looked at using before and after revaluation scenarios using assumptions that were the best available at the time and that the real problem is that the taxpayer is looking at less resources to deal with their tax bill.
Mr. Askham added that increased ECS funding will be used towards reserves that will, in turn, be used to fund Board of Education capital projects so that they can stay within the debt guideline. Ms. Mielert stated that, relative to any additional ECS funding, the Governor has referred to extra money for education but she also complains that she has not heard of one town that has cut taxes as a result of the extra money. She said that it is unclear to her as to how the State intends for the Town to use this money and that the Board is trying to find a balance between giving more money to schools while at the same time giving some tax relief to the taxpayers. She added that the Board may have sent a mixed message by not setting a cap and instead setting a guideline. Although she argued for a guideline at the time, given
the current economic indicators and discussions revolving around recession, she regrets that and felt that it might have been kinder to give both Boards a 3.5% cap on spending. She noted that the Board of Education is efficient and good at planning and trying to save money when possible while trying to do the best for the Town’s children.
3. OTHER BUSINESS
Mr. Henault asked for discussion on the Board of Education’s budget presentation. Ms. Fitzpatrick said that the Board always regrets that it can not give everything that is asked and that she appreciates the Board of Education’s and Superintendent’s efforts to maximize every cent that they get. However, the Board of Finance is faced with the broad responsibility for all of the Town’s finances and must evaluate the priorities that come before it. Given that it is a tough year, she felt that the BOE should take another look at their budget and conform to the 3.5% guideline.
Ms. Fitzpatrick made a motion to request that the Board of Finance request that the Board of Education re-examine their submitted budget so as to conform o the 3.5% guideline. Mr. North seconded the motion.
Mr. Henault questioned Mr. Kane about timing of public notice relative to the Public Hearing that is scheduled for April 1st. Mr. Kane suggested that the Board should meet no later than next Thursday or Friday in order to provide adequate lead time.
The motion passed unanimously.
Mr. Askham cited a recent article that noted that the State has not funded its OPEB obligation and are behind on their pension obligation and, if they were to do so, the State budget would increase by 15%.
4. APPROVAL OF MINUTES
Mr. North made a motion to approve the February 12, 2008 Regular Meeting minutes. Ms. Fitzpatrick seconded the motion and it passed unanimously.
Ms. Fitzpatrick made a motion to approve the February 26, 2008 Regular Meeting minutes. Mr. North seconded the motion.
Mr. North stated that he had some confusion relative to the motion made pertaining to capital projects relative to the Eno Hall project in that it was his perception that the intent of the motion was to approve $600,000 of the $1.2 million of work to be done. He was then shocked to see bond language that referred to a project total of $1 million. He thought that the confusion may have arisen when projects were moved around to as to whether they were to be funded out of the Undesignated Fund Balance and Town cost to bond. He noted that, prior to the motion, the Treasurer had encouraged the Board to make motions based on the total cost, regardless of the funds’ source and that the motion was not consistent in that regard as the amount referred to for the Tootin Hills project was the net Town cost, rather than the
total project cost. His intent was that the $600,000 cost for the Eno project was the gross cost to be offset by the Eno Fund, any grants that were available and the balance from Undesignated Fund Balance. He asked for input from the other Board members.
Mr. Mason stated that his recollection was that there would be $600,000 net out of reserves and that other funds would come from other sources. Ms. Mielert stated that her motion intended a total project cost of $1 million as there is currently almost $200,000 in the Fund and a grant has been applied for from the Small Town Economic Assistance Program. Ms. Fitzpatrick concurred that her impression was that $600,000 would be designated from reserves, but that she had a concern that the bonding language exposes the reserves for an amount up to $1 million. Mr. Kane stated that Part B of the Special Town Meeting/Referendum language will refer to how a project is actually to be funded. Mr. Henault suggested that the Board table approval of the minutes until after the Public Hearing.
Ms. Mielert requested a correction of “CROG” to “CRCOG”. Mr. North asked that the word “request” be changed to “option” and that the phrase “by the State” be added on page 3 for clarification.
5. ADJOURNMENT
Mr. Mason made a motion to adjourn the meeting at 7:25 P.M. Ms. Mielert seconded the motion and it passed unanimously.
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Paul Henault, Chairman Debra L. Sweeney, Clerk
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