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FINCOM MINUTES 04-27-2015
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Town of Canton Finance Committee Minutes Voted on: 5/13/15
Meeting Minutes Vote: 9-0-1
Monday, April 27, 20015
Members Present:
Sepp Bergschneider, Jim Casamento, Jerry Dorfman, Nichola Gallagher, Dianne Gustafson, Tim
McKenna, Barbara Saint Andre and Jim Sims.
Members Absent:
Rob Barker, Stephanie Leach and Diane Wolff.
Guests Present:
Kevin Donovan, Resident
Jeff Granatino, Superintendent, Canton Public Schools
Pat Johnson, Capital Planning Committee
Gene Manning, Chairman, Capital Planning Committee
Barry Nectow, School Business Administrator
Jim Murgia, Finance Director
Ellen Jones, Finance Committee Secretary
Opening:
A meeting of the Canton Finance Committee was called to order at 7:00 p.m. on Monday, April 27, 2015
in the Community Meeting Room of the Canton Public Library.
A. Approval of Agenda
Acting Chair Barbara Saint Andre welcomed the guests and reviewed the items on the agenda.
B. Announcements
There were no announcements at this time during the meeting.
C. New Business
FY16 Cherry Sheet Information — Updated State Aid - $136,208
Mr. Murgia provided the latest Cherry Sheet numbers for state aid that had recently been released by the
House. The Revenue Committee recommended a Total Estimated Receipts FY16 budget of $7,262,423
which represents a $74,000 increase over the FY15 Cherry Sheet Estimate (see meeting handout). The
Senate had not released their version yet. The latest House version is $8,000 greater than the
Governor's FY16 proposal. The net state increase between the Revenue Committee's FY16
recommendation of $6,321,666 and the FY16 House proposal is $136,208. The $136,208 would be
recurring revenue. The sharing of this recurring revenue would be $91,000 for the School Department (or
2/3) and $45,000 for municipal departments (or 1/3).
Request for Additional Funding for FY16 School Department Budget and New Capital Request of
$540,000 for FY16
Superintendent Granatino and Barry Nectow introduced themselves. School Committee Chairman Bob
Golledge was unable to attend the meeting due to an out of town commitment. There were no School
Committee members in attendance at the meeting.
Mr. Granatino stated that the School Committee was now pursuing the purchase of six school buses at a
cost of $540,000 through the long term debt capital process (see meeting handout). These new buses
would help to implement the school start time changes. They were also interested in addressing a
$286,800 budget shortfall for FY16. Since the last meeting with the Finance Committee the School
Committee had been able to reduce the shortfall to $65,800 (see meeting handout). The $177,000
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transportation charges (for operating costs associated with six new buses) had been built into the
Superintendent's FY16 Budget Recap. Mr. Nectow provided a Start Time Committee Transportation
Analysis for the $177,000 (see meeting handout).
Mr. Granatino reported to the Committee that they had received the support of the Capital Planning
Committee for the purchase of the six buses. The Finance Committee is recommending an FY16 budget
for the School Department of $36,168,994. The School Committee had voted an FY16 budget of
$36,455,794. This represented a difference of $286,600. This $286,600 was reduced by the additional
state aid of $91,000 to a shortfall of $195,800 and further reduced to $65,800 after considering $130,000
of additional revenue offsets.
The Finance Committee discussed the following issues:
• The Committee was concerned with the sustainability in the budget for the operating costs
associated with the six buses.
• With $80,000 being transferred from the SPED Stabilization fund for FY15, a Committee member
was concerned if another transfer would be needed for FY16. Mr. Nectow stated that they fully
expected to utilize circuit breaker funds by year end but that SPED costs continue to remain
unpredictable.
• The Finance Committee was also concerned about the debt service costs associated with the
buses and the effect on the fixed costs budget.
• By adding an additional 12.8 FTEs (teachers) for FY16, Committee members were concerned
about the potential impact to the fixed costs budget for health insurance costs. Mr. Murgia
estimated that for every FTE hired, there could be an additional $15,000 per FTE per year for
health insurance costs. Mr. Murgia stated that the only time the health insurance fixed costs
budget had been increased from adding new hires was during the year of the override.
• The School Department was budgeting six bus drivers (in addition to the 12.8 teachers) at 5.5
hours per day which would make them benefits eligible for a potential additional cost of $90,000
per year. In response to Mr. Murgia's suggestion to hire bus drivers less than 5.5 hours per day,
Mr. Granatino stated that it was difficult to hire employees for such little hours per day and that
parents expected continuity of drivers. Mr. Murgia also commented that that the Council on Aging
had been successful in hiring retirees to drive their senior buses for far less than what the School
Committee was budgeting for these six new bus drivers.
• A Committee member questioned if the $50 increase to the annual bus fee from $200 to $250
could potentially decrease the number of students riding the bus, thus decreasing the amount of
bus fee revenue to the School Budget. Mr. Nectow did not think this would have an impact.
Mr. Granatino stated that the School Committee would be discussing the buses and the operating budget
again at their meeting on Thursday, April 30.
Ms. Johnson was the dissenting vote in the Capital Planning Committee's 3-1 vote regarding the
$540,000 long term debt request for the buses. Ms. Johnson expressed her concern for the adverse
effect the bus purchase could have on the operating budget.
Mr. Manning, Chairman of the Capital Planning Committee, stated that the School Committee did have in
their capital plan the capacity for $540,000. While the CPC did initially have concerns about the impact
on the School's operating budget, the majority of them were comfortable with this request going forward
at Town Meeting.
Mr. Casamento questioned if the School Committee had information as to the cost of operating six
additional buses through the present bus company, Michael J. Connolly Company. At an estimated cost
of $55,000 per bus for six buses the total yearly impact to the budget could be approximately $335,000.
Mr. Casamento was convinced that purchasing six buses would not be the cheapest financial cost to the
Town. There are two more option years left on the contract with the present bus company. The School
Department had contacted the bus company and they would be able to accommodate Canton leasing six
additional buses.
Acting Chair Saint Andre invited a member of the audience to make a public statement. Mr. Kevin
Donovan of 3 Adrienne Drive, an attendee at frequent School Committee meetings, was concerned about
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the ongoing budget increases. Mr. Donovan spoke in support of additional teaching FTEs as opposed to purchasing six buses. Mr. Donovan also expressed concern with the classroom size. Vote to Reopen Article 12 "Omnibus" Capital Outlay Program — Vote New Motion - $540,000 A motion made by Nichola Gallagher to reopen Article 12 was seconded by Dianne Gustafson. Vote: 8-0-0. A motion made by Nichola Gallagher for $540,000 for the purchase of six school buses through borrowing was seconded by Dianne Gustafson. Ms. Gustafson expressed concern about the operating costs associated with the buses. Mr. Casamento spoke in opposition to purchasing buses because the costs would be more expensive than leasing six additional buses through the existing bus company. He could not support the School Committee's request if it meant additional costs to the Town. Mr. Casamento stated that if you add the benefits employees received it could be that purchasing exceeds leasing costs. Ms. Gallagher spoke in support of the School Committee's request. Mr. Dorfman spoke in opposition to the Town being in the bus business and spoke in support of the Town leasing through the bus company. Mr. Dorfman also stated that the bus budget presented appears to be optimistic. The bus budget does not reflect any benefits to be paid (pension and health), does not address follow off of bus ridership revenue due to an increase of $50.00 for the rider fee and the cost of additional staff to fill in for drivers on leave. Mr. Granatino stated that benefits costs appear on the municipal side and that DEP could fill in for absent drivers. Mr. McKenna commented that the School Committee had provided detailed costs with regard to purchasing and operating six additional buses but failed to provide information with regard to the leasing option. Vote: 4-4-0. The tie vote meant the motion failed. Mr. Sims, Mr. Casamento, Mr. Dorfman and Mr. Bergschneider voted in opposition to this motion. If this motion was brought forth at Town Meeting the Finance Committee would report to Town Meeting that their vote was a tie vote. At the time of the Finance Committee meeting the Board of Selectmen had not taken a position on the additional state aid of $136,208 or the municipal share of $45,000. Vote to Reopen Article 42 — School Department Budget A motion made by Nichola Gallagher to reopen the School Department budget under Article 42 was seconded by Dianne Gustafson. Vote: 8-0-0. A motion made by Jim Casamento to increase the Finance Committee recommendation for the FY16 School Department budget of $36,198,994 by $91,000 to $36,259,994 was seconded by Nichola Gallagher. Vote 8-0-0 The FY16 School Department budget of $36,259,994 would represent a 4.95% increase over the FY15 budget. Mr. Murgia suggested to the Finance Committee to hold off on voting on the additional state aid of $45,000 for the municipal departments until the Board of Selectmen takes a position on this additional amount. Mr. Murgia clarified for the members that if the School Committee went ahead with their request for an additional $65,800 they would have to identify a source of funds at Town Meeting. If the buses were not supported by Town Meeting the $177,000 being budgeted for the operating costs of the six buses would FINCOM Minutes 04-27-2015 Page 3 of 6 04/28/2015 Printed on 5/11/15
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still remain in the School Department budget and could be spent by the Department in any manner due to bottom line authority. FY15 Operating Results as of March 31, 2015— (see meeting handout) Mr. Murgia stated that the results were very positive for the first three quarters of FY15 and that the actual operating surplus for this same period amounted to $2.4 million. The revenue for the first nine months was 79.2% of budgeted revenue for FY15. Local receipts were 5.5% more than budgeted for all of fiscal 2015. Excise taxes could exceed $4 million for the fiscal year which would be the first time for Canton. Pre-Town ATM/STM Meeting held on April 15, 2015 — (see meeting handout) Mr. Sims reported to the Committee that the majority of the meeting dealt with the procedure of STM. It had been discussed that there would be an approximately 3-hour informal session of STM articles prior to any voting. Because Article 23 was essentially Article 1 of the Special Town Meeting and Article 24 was Article 2 of the Special Town Meeting and the votes for these articles were to postpone indefinitely, it had been decided that Articles 23 and 24 would be added to the Consent Agenda. Coverage for the First Night of ATM/STM — Because Acting Chair Saint Andre' would be unable to attend the first night of Annual Town Meeting, there was some discussion as to which Finance Committee member would be chairing that night. The Finance Committee members decided that Dianne Gustafson would fill in for Ms. Saint Andre. D. Other Business/Open Issues New Officials Forum on June 2, 2015 — Mr. Casamento and Ms. Leach would be attending the Forum. Conflict of Interest Law — Acknowledgement of Receipt/On-Line Training - Members were reminded about their obligation for completing the requirements of the Conflict of Interest Law. These certificates should be returned to the Town Clerk's office. Committee Members — Term Expirations — (see meeting handouts) Four members terms were set to expire at the conclusion of the 2015 Annual Town Meeting - Robert Barker, Gerald Dorfman, Tim McKenna and Diane Wolff. Ms. Wolff was not eligible for reappointment but the other three members were eligible for reappointment by the Moderator. Members were encouraged to reach out to the Moderator after Town Meeting to express their interest for reappointment. Acting Chair Saint Andre announced that there were vacancies on the Committee. Liaison Reports — There were no liaison reports at the meeting. Article 4— Consent Agenda A motion made by Nichola Gallagher to reopen Article 4 was seconded by Jim Casamento. Vote: 8-0-0. A motion made by Nichola Gallagher to add Articles 23 & 24 to the Consent Agenda was seconded by Sepp Bergschneider. Vote: 8-0-0. E. Approval of Minutes A motion made by Sepp Bergschneider to approve the April 9th minutes as written was seconded by Jim Casamento. Vote: 8-0-0. FINCOM Minutes 04-27-2015 Page 4 of 6 04/28/2015 Printed on 5/11/15
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F. Next Meeting Date: Meetings would be posted for May 11, 2015 at 6:00 p.m. and May 13, 2015 at 6:30 p.m. prior to the start of the first two nights of Annual Town Meeting. Adjournment: A motion made by Nichola Gallagher to adjourn the meeting at 9:00 p.m. was seconded by Sepp Bergschneider. Vote: 8-0-0. Minutes reviewed by: Sepp Bergschneider Respectfully submitted, Earba Saint Andre Acting Chair, Canton Finance Committee FINCOM Minutes 04-27-2015 Page 5 of 6 04/28/2015 Printed on 5/11/15
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Town of Canton
Finance Committee Meeting — Monday, April 27, 2015
List of Meeting Handouts
Please note: These meeting handouts may also be found on the Town's website under the Posted
Minutes section (Laser Fiche).
Agenda (1 page).
Fiscal 2016 Cherry Sheet Comparison, dated 4/22/15, provided by Jim Murgia, Finance Director
1 page).
Email from Bob Golledge to the Finance Committee, dated April 27, 2015 (1 page).
FY16 Budget Recommendation Recap, April 24, 2015, provided by Barry Nectow, School Business
Administrator (2 pages).
Start Tim Committee Transportation Analysis/Operating Budget Impact, dated April 27, 2015, provided by
Barry Nectow, School Business Administrator (2 pages).
New Motion — Article 12 Motion 10 - $540,000 for six school buses, dated April 23, 2015, provided by
Barry Nectow (1 page).
Operating Results as of March 31, 2015, dated April 17, 2015, provided by Jim Murgia, Finance Director
(8 pages).
Email from Tracy Kenney regarding Summary of the Conflict of Interest Law for Municipal Employees and
Municipal Employee Online Training Program, dated April 3, 2015 (1 page).
Email from Jim Sims to the Finance Committee regarding Pre ATM Meeting Summary (2 pages).
List of Finance Committee Members dated April 27, 2015 (1 page).
Copy of Finance Committee By-Law, dated 2014 edition (3 pages).
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