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March 20, 2017, Finance Committee Meeting. Minutes

Finance Committee · Record date 2017-03-20 · Record 4fea4d002a5385bf15

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Canton Finance Committee                          Minutes Voted on: 3/29/17
                                            Meeting Minutes                              vote: g-o-o
                                         Monday, March 20, 2017



Members Present:
Rob Barker, Jerry Dorfman, Nichols Gallagher, Dianne Gustafson, Cynthia Holcombe, Stephanie Leach,
Tim McKenna, Barbara Saint Andre and Cindy Thomas.

Members Absent:
All members were present for the meeting.

Guests Present:
Cindy O'Connell, Conservation Agent
Aidan Maguire, Canton Representative to the Blue Hills School Committee
Steven Moore, Asst. Supt. for Business &Personnel, Blue Hills Regional Technical High School
Jim Quaglia, Superintendent-Director, Blue Hills Regional Technical High School
Kyle Bush, Resident
Jim Murgia, Finance Director
Ellen Jones, Finance Committee Secretary

Opening: A meeting of the Canton Finance Committee was called to order by Chair Saint Andre at
7:05 p.m. on Monday, March 20, 2017 in the Salah Meeting Room of Town Hall.

A.       Approval of Agenda

Chair Saint Andre reviewed the agenda and welcomed the Conservation Agent and representatives from
the Blue Hills Regional Technical School and stated the Committee would also be reviewing and voting
on Town Meeting articles.

B.       Announcements

There were no announcements

C.       New Business

Article 34 —Vote to Amend Wetlands Protection By-Law —Discussion with Conservation Agent
Cindy O'Connell
Ms. O'Connell stated that Article 34 was a housekeeping article with modifications to Article XV of the
General By-Laws —the Canton Wetlands Protection By-Law.

She stated that the article contained the addition of an exception to allow residents to remove dead
vegetation within the 100 foot buffer zone which is a jurisdictional area for the Conservation Commission.
The Conservation office receives many telephone calls, especially since the fatalities of last winter, with
inquiries about tree removal. In the past any work done within the 100 foot zone required that the
homeowners file an application with the Conservation Commission (a Request for a Determination of
Applicability). The addition of this new paragraph to the by-law would mean the removal of diseased or
damaged trees that are more than 50 feet, but less than 100 feet away from a wetland would not require
the application. The jurisdiction is not changing. With regard to who would determine which trees are
diseased or damaged, Ms. O'Connell stated that that determination would made by her.

The second insertion in the by-law would bring the notification of the by-law consistent with the same
language of the state wetlands protection by-law to allow applicants to notify abutters by three methods of
notification instead of two methods of notification adding "certificates of mailing" as an acceptable method
of notification. The state by-law also allows "certificates of mailings" which are significantly less
expensive than certified mailings. The "certificates of mailings" would be sufficient proof of mailings to
abutters.


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According to Ms. O'Connell both changes to the Wetlands Protection By-Law have been approved by the
 Conservation Commission.

 Article 35 —Vote to Authorize the Leasina of the Tilden House

 Ms. O'Connell stated that the Tilden House is on the Pequitside Farm property and the Conservation
 Commission is the steward of the property. There was an agreement between the Commission and the
 Friends of the Little Red House that was approved a few years ago when the work began on the Tilden
 House. She further stated that Mr. George Comeau was more knowledgeable on the details of the
 leasing of the Tilden House than she was but that the Commission is supportive of the concept of the
 leasing and formally took a vote at a public meeting, but the main source of support is the Friends of the
 Little Red House.

 Blue Hills Regional Technical High School — FY18 Budget and $86.5 million Capital Project —
 Discussion with James Quaglia, Steven Moore and Aidan Maguire

 Mr. Moore introduced Mr. Quaglia and Mr. Maguire. Three booklets containing information on the budget,
 member assessments and the school renovation project were provided to the Committee members (see
 meeting documents). These booklets were printed by the students at Blue Hills.

 Some of the highlights of Mr. Moore's discussion about the FY18 budget were as follows:
• Their budget is built on three ideas: Responsible in addressing the needs of students for advancing
     the district toward long-term goals; Realistic with the understanding of economic factors that generate
     revenue for the member towns and Responsive to the known needs of the students and the
     understanding of the tools that teachers need to meet the needs of the students.
• MCAS scores have remained at high levels with increases in biology. The school is at a Level 2
    status.
• The budget increase for salaries for FY18 is $326,108 or 3.1 %.
• The budget increase for expenses for FY18 is $245,969 or 2.9%.
• The overall increase for FY18 is 3% (does not include funding for MSBA project funds).
• The largest increase for the budget is for instructional salaries and instructional expenses. Additional
    money going into the budget is being used for salaries and expenses that have a direct impact on
   students.
• The adjusted overall increase for FY18 (which includes a $647,003 increase to capital projects) is
   6.8%. The $647,003 will be offset by some E&D funding (Excess and Deficiency similar to the
   Town's Free Cash). The E&D is certified by the state each year. The district is allowed to retain 5%
   of this E&D for their budget, with the remaining funds going back to the member communities.
• Member town assessments will be increasing less than the 6.8% budget increase for FY18 which
    includes $647,003 for capital projects.
• In response to Mr. Barker's inquiry about the math state average not being included in the chart on
   page 7(MCAS Advanced/Proficient Scores) Mr. Moore stated that he would include this for next year.
• Blue Hills is focusing on math skills development and is adding a criminal justice teacher
• Solar Panels would not work on the roof of the building because of the present layout. With the
   possible addition of HVAC units on the roof from the MSBA project there would be even less room for
   solar panels.
• Blue Hills is a member of the state's GIC health insurance program. There will be a $70,000 increase
   or 3.7°/o for FY18 for current employees and a $70,481 increase or 4.8%for FY18 for retired
   employees.
• The goal for the Blue Hills School has always been a 3% or less budget increase.


The following are some of the highlights of the proposed member town assessments:
• For FY18 the School assessments for the nine member towns is increasing by $568,963 or 4.19%.
• Canton's FY18 assessment is decreasing by $16,701 or -1.41 %for FY18.
• Canton's total assessment for FY18 will be $1,164,066.
• Assessments are based on the prior year's October enrollment figures. Canton's enrollment
   decreased by four students. The required contribution by the state for per pupil spending is $13,556.


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Ch. 70 aid is funded directly from the state to Blue Hills Regional School. If Ch. 70 aid decreases for
     Blue Hills, the school "owns" the decrease and does not go back to the member towns seeking an
     assessment increase.
     Blue Hills will be using $993,078 of available E&D for the FY18 operating budget. ($660,507 is from
     available E&D and $332,571 is from a special project account in 2015 for which the MSBA covered
     some of the project costs). This will leave a zero balance in the E&D fund, however, the budget was
     increased a year ago for a feasibility study and schematic design MSBA project which was
     approximately $1 million. Once the School receives the MSBA reimbursement for that project those
     funds will go back in the E&D fund for next year. The School expects to receive roughly a 53%
     MSBA reimbursement.

 Mr. Quaglia reviewed for the Finance Committee the proposed $86.5 million School Renovation Project
 as follows (see meeting documents):
• The school will not be increasing the footprint of the building. The architects have determined that the
     "bones" of the building are very good and worth preserving and renovating the 51-year old building.
• Main purpose of the project is to replace outdated and failing systems that are nearing the end of their
      useful life.
• Items to be included in the major renovation are windows, entries, glazing, entire HVAC systems,
     electrical, transformers, plumbing, ADA compliance and life safety systems.
• ADA is a large cost driver of the renovation project.
• After six SOIs (Statements of Interest) to the MSBA for this project, MSBA finally accepted Blue Hills
      into the Core Program.
• Blue Hills anticipates 50% reimbursement for the project.
• The total construction cost through completion is anticipated at $86.5 million.
• In response to a Committee member's inquiry regarding the possible use of students as labor for the
     project, Mr. Quaglia stated that because of the strength of unions in Massachusetts and liability
     issues, students would not be used for any major construction aspects of the project. He indicated
     that possibly students could be utilized for wood or wrought iron railing work.
• The project is expected to last over an 18-month to two-year timeframe.
• The high cost of a new building as well as the lack of land for a new school were deciding factors for
     renovating versus building new. Mr. Quaglia gave an example of a $145 million new regional
     vocational school building in Lexington. Current playing fields at the Blue Hills schools are wetlands
     and would not be viable land for construction.
• Ms. Thomas inquired about the possibility of PCBs and asbestos in the building. Mr. Quaglia could
     not comment on this at the present time because there has not been any testing done. He indicated
     that abatement would be a significant portion of the project cost. To date, approximately 30% of the
     building has had the asbestos floor tiles and mastic removed.
• Ms. Thomas also inquired as to how the project could affect students. Mr. Quaglia responded that
     originally modulars had been a consideration but the construction manager uses a phasing
    construction schedule and does not use modular or portable classrooms. Vacations and summertime
     will be used to replace major items such as windows and walls.
• According to Mr. Quaglia, Consigli Construction does not have a history of overruns but
    approximately 10%will be built into the contract for cost overruns.
• By June 23, 2017 Blue Hills must inform MSBA about the cost of the project.
• With regard to the disruption of services, classes and use of the grounds and pools for the residents,
     Mr. Quaglia indicated that during the 18-month to two-year construction period evening classes would
     be stopped. Use of the pool and recreation facilities would not be allowed during the construction
     phase. He does not foresee a significant loss of revenue with the discontinuation of evening classes.

Mr. Moore addressed the member approval process for the project:
• The project is in Phase 4 of the project —schematic design.
• The project will go to the MSBA in August 2017 for funding approval.
• The borrowing authorization letter for the entire cost of the project will be sent to the School District
    sometime in September 2017.
• The Blue Hills School Committee will send a notice that it has approved the borrowing for the project
    to all of the towns that are members of the School District.
• The member towns have 60 days after the notice from Blue Hills to vote to disapprove the project. If
    one member town rejects the project then the project and the process of getting legislative approval

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by the Towns comes to an end and does not go forward. If a town does not vote to disapprove the
       project, the town is considered to have approved it.
•      If the District wishes to pursue the project after it has been rejected by a member town, it would be by
      a districtwide ballot referendum and would require a simple majority to approve it on a ballot
      referendum. Approval of the project could cause lack of available funds for a community resulting in
      a potential override.
•     The Board of Selectmen would be the authority to call for a fall town meeting, or 200 registered voters
      could petition for a special town meeting.
•     July 2017 through January 2018 there would be no funding yet for the project.
•     Blue Hills would go out fora $10.0 million BAN (bond anticipation note) sometime around January
      2018.
•     In July 2018 the first half of the $43.25 million would be borrowed.
•     Chair Saint Andre inquired if there would be final design and final phasing plans by July or August of
      this year. She also emphasized that voters would need more detailed financial numbers about the
      project.
•     July and August will be a critical time for Blue Hills to produce detailed information for MSBA. Once
      that happens Blue Hills would be able to provide more detailed information to the "stakeholders" or
      member towns.
•     MSBA is viewing Blue Hills as a "limited scope repair" project and would be following the MSBA's
     accelerated timeline.
•    The approximate cost to the Town of Canton would be an extra $200,000 per year for 30 years (see
      meeting document). This estimate is based on a 5% interest rate. The model is a level debt service
      model versus a level principal debt model. The debt estimate is also based on 50% reimbursement
     from MSBA.
•    Canton's assessment is based on the four-year average of enrollment.
•    In order for the operating budget to be approved it requires six out of nine member towns for
     approval. If four towns disapprove the budget Blue Hills is required to re-examine the budget and
     present an updated budget to the member towns.
•    If the town approves the budget for FY18 and it includes the $1.3 million funds to pay for a designer
     for the construction project, and the project does not go forward, those funds in the operating budget
     in the capital account, would be placed in a fund for repairs of failing systems. These funds would
     carry over year to year. If money is left over at the end of the year and it was not designated to a
     special projects fund, then it would go back into the E&D fund and would be used to reduce future
     assessments.

The Chair is looking forward to seeing more details on the project. Mr. Quaglia's target for sending
additional information to the member towns is mid-July, at the latest. At a Finance Committee member's
suggestion, Mr. Quaglia stated that it would be beneficial to have an open house of the project sometime
over the summer. Canton is the 5'h out of nine communities that Blue Hills has presented information to
about the project.


D.       Other Business/Open Issues

The Finance Committee voted on the following Town Meeting Articles:

Article 34 —Vote to Amend Wetlands Protection By-Law

A motion made by Mr. Barker that the General By-Laws with regard to the Wetlands Protection By-
Law be amended as set forth in the warrant was seconded by Ms. Gallagher. Vote: 9-0-0,

Articles 4, 5, 6 and 9 will be voted at a future meeting.

Article 27 Motion 8 —Community Preservation Committee —Canton Little League - $173,500

Chair Saint Andre informed the Committee that Mr. George Comeau, Chair of the Canton Community
Preservation Committee, would be willing to attend a Finance Committee meeting to discuss some of the
unresolved concerns the Committee has with regard to the maintenance and upkeep of the restroom and
storage facility the Canton Little League would like to build at the Kennedy School field. A Committee
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member emphasized the need to also hear the opinion of the School Committee on this project. The
 Finance Committee will vote on this article at a future meeting.

Vote —Article 17 —Increase Stabilization Fund — Mr. Murgia provided to the Committee an updated
Estimated Free Cash Reserves balance sheet(see meeting documents). Some of the highlights of the
Committee's discussion are as follows:
• Actual free cash reserve balance as of 6/30/16 was $4.2 million.
• So far in the budget process, $809,000 has been identified for various articles at ATM and
   $1,168,371 has been estimated as the increase to the Overlay Reserve leaving a balance of $2.2
    million.
• Mr. Murgia reminded the members that any increase to the Overlay Reserve would cause a reduction
   to Free Cash.
• Any transfer into the Stabilization Fund does not change the overall balances of the reserves of the
   Town.
• The bond rating agencies look favorably at transfers into the Stabilization Fund.
• The Municipal Modernization Act has made it a simple majority to transfer money into the
   Stabilization Fund but a 2/3 majority is still required to transfer money out of the Fund.
• At last year's ATM voters transferred $600,000 into the Stabilization Fund.
• A Finance Committee member inquired about the balance in the OPEB budget. The FY17 OPEB
   budget was $770,000. The FY18 budget has been increased to $800,000.

A motion made by Mr. McKenna that $500,000 be transferred for FY2017 from Free Cash into the
Stabilization Fund was seconded by Mr. Barker. Vote: 9-0-0.

Vote —Article 59 Motion 1 —Appropriate Funds to Meet Expenses for Next Fiscal Year(FY18)
The purpose of the transfers in Article 59 Motion 1 are transfers into the general fund to balance the FY18
budget. Transfers from the Enterprise Funds to the Fixed Costs budget is to cover health insurance
costs, pension costs and OPEB costs. A $100,000 increase from $650,000 to $750,000 for the transfer
from the Ambulance Service to the Fire Department budget is to offset cover for the new central dispatch.

A motion made by Mr. Barker to transfer to the General Fund in FY18 in order to fund the
operating budget the following sums of money for a total transfer of $2,340,524

                                    Votes to Transfer Available Funds

      With a vote that $2,340,524 be transferred as follows:
                  TRANSFER FROM                           AMOUNT                PURPOSE
     AMBULANCE SERVICE                                     $750,000    FIRE DEPARTMENT
     WATER ENTERPRISE FUND                                  514,825    FIXED COSTS
     SEWER ENTERPRISE FUND                                  358,865    FIXED COSTS
     SOLAR FACILITY                                         331,144    TOWN-WIDE ELECTRICTY
     SCHOOL FOOD SERVICE                                    160,500    HEALTH INSURANCE
     AMBULANCE SERVICE                                      175,190    DEBT SERVICE
     GREENLODGE STREET PARKING FEES                          35,000    EXECUTIVE OFFICE
     SALE OF LOTS/GRAVES                                     10,000    CEMETERY MAINTENANCE
     CEMETERY PERPETUAL CARE (EXPENDABLE)                     5,000    CEMETERY MAINTENANCE

                                                          $2,340,524



was seconded by Ms. Gallagher. Vote: 9-0-0.


E.       Approval of Minutes

The March 16th meeting minutes were not approved and will be voted at a future meeting.

F.       Next Meeting Date: The next meeting is scheduled to take place on Wednesday, March 22.



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Adjournment: A motion made by Mr. McKenna to adjourn the meeting at 9:25 p.m. was seconded
by Ms. Gallagher. Vote: 9-0-0.

Minutes reviewed by: Stephanie Leach
Respectfully submitted,
(S PAZ
a               a
Barbara/Saint André
Chair, Canton Finance Committee

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[Original embedded text, retained for comparison]
Adjournment: A motion made by Mr. McKenna to adjourn the meeting at 9:25 p.m. was seconded
 by Ms. Gallagher. Vote: 9-0-0.

 Minutes reviewed by: Stephanie Leach

 Respectfully submitted,


  .l~
 Barbar aint Andre
 Chair, Canton Finance Committee




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Canton Finance Committee Meeting
                                      Monday, March 20 16, 2017

                                          Meeting Documents

  Please note: These meeting documents may also be found on the Town's website under the
  Posted Minutes section (Laser Fiche).

 Agenda (1 page).

 Article 34 —draft —Vote to Amend Wetlands Protection By-Law, as of 3/20/17 (1 page).

 Wetlands Protection By-Law, Article XV (4 pages).

 Blue Hills Proposed 2017-2018 Operating Budget, dated 2/2/17(19 pages).

 Blue Hills Proposed 2017-2018 Member Town Assessments, dated 2/2/17(15 pages).

 Blue Hills School Renovation Project(7 pages).

 College and Career Opportunities, 2017-2018(6 pages).

 M unicipal Assessment History Fact Sheet, Canton (1 page).

 Canton Project Assessment 10 Year Estimate, Level Debt Payment Model (1 page).




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