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October 28, 2014, FINCOM Meeting. Minutes

Finance Committee · Record date 2014-10-28 · Record 09dbd690d6b9a054ca

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Town of Canton Finance Committee                        Minutes Voted on: / / -10   4/
                                             Meeting Minutes                               Vote:    —0 0
                                         Tuesday, October 28, 2014



  Members Present:
 Rob Barker, Sepp Bergschneider, Jerry Dorfman, Nichola Gallagher, Dianne Gustafson, Stephanie
 Leach, Tim McKenna, Mark Porter, Barbara Saint Andre and Jim Sims.

 Members Absent:
 Diane Wolff.

 Guests Present:
 Jim Murgia, Finance Director
 Ellen Jones, Finance Committee Secretary

 Opening:
 A meeting of the Canton Finance Committee was called to order at 7:04 p.m. on Tuesday, October 28,
 2014 in the Salah Meeting Room of Town Hall.

 A.      Approval of Agenda
 Chairman Porter stated that the purpose of the meeting was to discuss the operating results for fiscal
 2014, first quarter results for fiscal 2015 and other miscellaneous items.

 B.      Announcements
 There were no announcements.

 C.      New Business

Final FY14 Operating Results — General Fund — (see meeting handout) Mr. Murgia, the Finance
Director, reported to the Finance Committee that the Town had an excellent year financially for fiscal
2014. The Town had prepared for a $2.1 million deficit in the general fund but ended the year with a $2
million surplus. The $4.1 million swing was attributed to better than expected revenue in local receipts
($1.4 million), property tax revenues due to new growth and fewer abatements ($787,046), tax
title/foreclose revenue ($782,539), transfers from other funds such as the solar facility and bond
premiums ($552,765) and unspent appropriations (also known as "turnbacks") of $541,527. Of the
$500,000 Reserve Fund overseen by the Finance Committee, $213,000 was allocated in July leaving
$287,000 as unspent.

Town Meeting appropriated $2.1 million of free cash to Shepard's Pond Dam repairs (approximately
$900,000), a snow and ice budget supplement (approximately $500,000), a transfer to stabilization funds
($485,000), other budget supplements (approximately $150,000) and July 4th events for 2013 and 2014
($70,000).

Mr. Murgia also reported that the Town's total reserves at the end of fiscal 2014 was approximately $10.6
million or 13.5% of fiscal 2015's budget broken down as follows: stabilization funds ($5.1 million), free
cash ($3.3 million) and overlay reserve ($2.3 million).

Mr. Murgia stated that fiscal 2014 was the best year financially for the Town of Canton.

Free Cash Certification as of July 1, 2014— (see meeting handout) Mr. Murgia reported that the Town's
free cash for the General Fund was certified by the DOR (Department of Revenue) at $3.271 million. The
Town had been deducted for six items due to deficits. One of these items was $152,789 for police grants.
Mr. Murgia stated that the Town had submitted the paperwork in a timely manner to the appropriate
agency, but that the agency did not have the funds to reimburse the Town. The Town has reached out to
our state legislators for assistance in obtaining these reimbursements.


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Final FY14 Operating Results — Enterprise Funds (see meeting handout) Mr. Murgia reported that
                                                           —


 the Water Enterprise Fund ended fiscal 2014 with an $800,000 surplus, thereby increasing its "free cash"
 to almost $2 million representing 31% of reserves. Mr. Murgia stated that healthy enterprise reserves
 could be used for capital purchases or could be used to reduce water and sewer rates. He gave an
 example of last year's purchase of water meters from reserves.

 The Rink Enterprise ended fiscal 2014 with a $48,850 surplus, increasing its "free cash" to about $75,000.

 Mr. Murgia explained that a high percentage of reserves was not looked at negatively by the bond rating
 agencies. Mr. Murgia stated that the consumption information with regard to sewer was not quite
 accurate and that measures were being taken by the consultant to adjust this.

 First Quarter FY2015 Operating Results — General Fund (see meeting handout) Mr. Murgia
                                                               —


 presented the operating results for the first quarter of fiscal 2015. The Town had budgeted an $801,000
 operating deficit with free cash being used for streets and sidewalks ($500,000), the Hansen School
 addition design ($250,000) and OPEB (other post employment benefits $51,000). The operating deficit
 for the first quarter was $2.5 million as compared to $2.7 million one year ago.

 Vice Chairman Saint Andre inquired about the Trash Collection budget (#433) as well as the
 Unemployment Compensation budget (#913). Mr. Murgia explained that there were currently two
 vendors being paid under the trash collection budget and that $247,000 had been expended and $1.4
 million had been expended/encumbered (91% of budget). The current contract with SEMASS for solid
 waste removal runs out December 31st. Republic will take over the solid waste disposal.

With regard to the $150,000 unemployment budget having already been 100% spent for FYI 5, Mr.
Murgia explained that $150,000 was transferred out of the General Fund budget to the Trust Fund in July.
Payments for unemployment claims are then spent out of the Trust Fund.

 Mitigation Funds Follow Up Ms. Gustafson gave the Committee an update with regard to the
                              —


mitigation funds discussion from the prior Finance Committee meeting on July 29. Ms. Gustafson had
recently received an email from William Friel's (Town Administrator) office with copies of current
mitigation agreements. At the time of the meeting, Ms. Gustafson had not had the opportunity to review
in detail the language within these agreements stating as to how the funds could be expended under
these agreements. A member stated that with the exception of the University Station/Westwood
agreement most of the agreements provide cash to the Town but do no contain a lot of restrictions as to
what purposes the funds could be used for. With regard to the University Station/Westwood agreement,
a member was under the impression that the agreement did not bind the Board of Selectmen but had the
intent that the funds were to be used for roadway improvements.

Mr. Sims stated that the NSTAR mitigation agreement had not been included with the agreements from
Mr. Friel and asked Ms. Gustafson to inquire about this agreement.

Mr. Murgia clarified for Committee members that proceeds from rental income would be considered as
general revenue. However decisions can be made to divert revenues under certain Mass general Laws.
Rental income from revolving funds established under Ch. 44 Section 53E1/2 such Library rentals and
Pequitside rentals is approved at Annual Town Meeting and diverted to other uses. Mr. Sims stated that
the School Rental Fund is being diverted to other uses because Town Meeting approved this revenue
under a different statute. Revenue generated from cell tower rentals is traditionally General Fund
revenue and is not considered rental income. Revenue generated under Ch. 44 53A is considered
donations or gifts and goes into a separate fund and may be spent without appropriation. This is the case
with revenue deemed mitigation revenue.

Ms. Gustafson will remain the point of contact with the Board of Selectmen's office with regard to the
mitigation funds and agreements. The Finance Committee members expressed interest in the
expenditures that have occurred under these mitigation funds.

Ms. Gallagher inquired as to how much is available under these mitigation agreements to be redistributed
to the School Department.


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Finance Committee Secretary — Rate of Pay — Mr. Murgia explained to the Committee that the Finance
 Secretary (who is also the 35 hours per week Administrative Secretary to the Finance Director), recently
 received approval by the Board of Selectmen for a retroactive grade increase (to July 1, 2014) from
 Grade 12 to Grade 13 for the Administrative Secretary position. The Finance Committee was asked to
 consider an increase from a Grade 12 to a Grade 13 for the Finance Committee Secretary position.
 There was no specific discussion as to the rate of pay but it was agreed that the rate of pay for the
 Finance Committee Secretary would be consistent with the rate of pay for the Finance Director's
 Administrative Secretary rate of pay.

 A motion made by Robert Barker to increase the Finance Committee Secretary position from
 Grade 12 to Grade 13 retroactive to July 1, 2014 was seconded by Sepp Bergschneider.
 Vote: 10-0-0.

 D.      Old Business/Open Issues

 Association of Town Finance Committees (ATFC) — Annual Meeting Update — Mr. McKenna
 provided an update to the Committee with regard to four individuals attending the ATFC Annual Meeting
 on Saturday, October 18 at the Tri County Regional Vocational Technical High School in Franklin. Mr.
 McKenna, Ms. Gallagher, Mr. Dorfman, Ms. Leach and Mr. Murgia attended the meeting.

 Mr. McKenna recapped some of the "hot" items for the future that were presented by the Needham Town
 Manager, such as recruitment, funding facilities, town consolidation of services and sustainability.

 Mr. McKenna attended a session with regard to financial policies and the importance of having these
 policies in place in order for actions and progress to happen. Canton does have some financial policies in
 place. Mr. McKenna also attended an afternoon session having to do with cities and towns sharing of
 services and resources such as IT (information technology) departments and centralized emergency
 dispatch.

 Liaison Reports

Fire Department — Mr. Dorfman gave an overview of a meeting he had with Fire Chief Doody on August
19. At that time there were four firefighters out on IOD (injured on duty) and 2 firefighters set to retire in
October. Mr. Dorfman referred to the Norfolk County Regional Emergency Communications Center
(NCRECC) MMA staffing study. The MMA consultant would be available to come to a Finance
Committee meeting to discuss the most recent study. Mr. Dorfman would reach out to Bill Friel's office to
check on the availability of the MMA consultant attending a Finance Committee meeting in the future.

Mr. Bergschneider and Ms. Gustafson reminisced that the Fire Department overtime and staffing had
been a topic of concern and discussion during their first tenure on the Finance Committee several years
ago.

Council on Aging (COA) — Mr. Sims requested either the liaison for the BRC (Buildings Renovation
Committee) or for the COA reach out for information about the $60,000 shortfall for the Senior Center
which would be covered by one of the BOS mitigation funds. The Chair suggested that Dr. Barker, the
liaison to the BRC could follow up with Bob McCarthy (Chairman of the BRC) as to the status of this
shortfall and the budget for this project.

School Department — Dr. Barker, the liaison for the School Department) would request detail from the
School Department as to the possible future need for an additional school. Ms. Gustafson asked Dr.
Barker to obtain information with regard to (1) the number of classrooms in each school building facility
(2) the number of grades in each facility and (3) the number of students in each classroom.

Planning Board - Mr. McKenna stated that he would be attending the Planning Board meeting on
November 5 in which there would be a presentation by the developer for the Plymouth Rubber site.


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Chairman Porter informed the Committee that he had met with the Planning Board Chairman as well as
  the Capital Planning Committee Chairman and that there had been a general sense of agreement with
  regard to the submittal of information to the Finance Committee during the budget and preparation of the
  warrant process.


 Finance Committee Website/Town Website — Mr. Sims presented to the Committee using the laptop
 and projector an overview of the Town's new website and Finance Committee website. Mr. Sims stated
 that there were some departments, such as the Library, that was seeking to maintain their current stand-
 alone websites. This may have a financial impact if the Town has to continue to pay for these additional
 websites.

 Mr. Sims stated his concern with regard to the Finance Committee minutes being stored in Laser Fiche
 with a link to the laser fiche from the new website. As of the time of the meeting none of the prior
 FINCOM meeting minutes had been transferred over to the new Finance Committee subsection of the
 website.

 Mr. Sims stated that the new website was scheduled to be released sometime around November 7-8 but
 that he had recently attended a meeting in which there was discussion that it could be delayed.

 Ms. Gallagher asked about the vendor's intent to migrate over all the information from the current
 website, and to the cost to the Town and to the new vendor's contract costs for the inclusion of
 independent websites maintained by some Town departments. The Chair will provide the e-mail address
 for the Town's Information Systems Manager so Ms. Gallagher could review these contracts.

 Ms. Gustafson inquired about the Annual Town Reports. These are in laser fiche currently, as well, but
 may not be available on the new site.

 There was some discussion as to whose role it was to post information to the new website — Town Clerk
 or Finance Committee etc. Ms. Saint Andre spoke in favor of the Finance Committee having the ability to
 post documents to the website. Ms. Gustafson stated that it would generally be dealt with in the policies
 from IT as to whose function it was to post documents.

 E.      Approval of Minutes

A motion made by Rob Barker to approve the July 29, 2014 meeting minutes as written was
seconded by Tim McKenna. Vote: 9-0-1. Mr. Bergschneider abstained as he was not present at the
July 29th meeting.

F.       Next Meeting Date: The next meeting date would be determined in the near future.

Adjournment: A motion made by Barbara Saint Andre to adjourn the meeting at 8:22 p.m. was
seconded by Sepp Bergschneider. Vote: 10-0-0.

Minutes reviewed by: Jim Sims

Respectfully s bmit



Mark 'Porter
Chairman, Ca n Finance Committee




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Town of Canton
                              Finance Committee Meeting — October 28, 2014

                                        List of Meeting Handouts


Agenda (1 page).

Memorandum with exhibits from Jim Murgia to Board of Selectmen dated August 14, 2014 regarding
General Fund's Fiscal 2014 Operating Results (10 pages).

Memorandum with exhibits from Jim Murgia to Board of Selectmen dated August 14, 2014 regarding
Enterprise Funds' Fiscal 2014 Operating Results (3 pages).

Email with exhibits from Jim Murgia to Mark Porter et al dated October 21, 2014 regarding FY2014 Free
Cash Certification (6 pages).

Memorandum with exhibits from Jim Murgia to Board of Selectmen dated October 27, 2014 regarding
First Quarter Operating Results as of September 2014 (8 pages).

Mitigation Fund Summary as of 6/12/14, provided by Kathy Butters, Town Accountant (11 pages).

Mitigation Agreements, provided by Bill Friel, Town Administrator, October 23, 2014:
1) iON the Ball (April 9, 2013).
2) Westwood Marketplace Holdings, LLC (University Station project) (August 2013).
3) T-Mobile/Comcast Cable Communications Management, LLC (January 7, 2011).
4) AT&T Wireless PCS, Inc. (September 8, 1998).
5) Verizon Wireless (April 18, 2008).
6) MetroPCS Massachusetts, LLC (April 14, 2009).
7) Town of Stoughton (March 26, 2002).
8) Town of Stoughton (December 2009).
9) Avalon Canton, Inc. (May 7, 2013).
10) Pequit View (Barletta)
11) The NSTAR mitigation agreement was not provided to the Finance Committee at the time of the
October 28, 2014 meeting.




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