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October 10, 2017, Finance Committee Meeting. Minutes
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Source page 1
Canton Finance Committee Minutes voted on: 2/26/18
Meeting Minutes Vote: 4-0-1
Tuesday, October 10, 2017
Members Present:
Rob Barker, Cynthia Holcombe, Dianne Gustafson, Tim McKenna and Cindy Thomas.
Members Absent:
Nichola Gallagher and Barbara Saint Andre.
Guests Present:
Dr. Jennifer Fischer-Mueller, Superintendent, Canton Public Schools
M ike Loughran, Chair, Canton School Committee
Barry Nectow, Canton School Business Administrator
Jim Murgia, Finance Director
Ellen Jones, Finance Committee Secretary
Opening: A meeting of the Canton Finance Committee was called to order by Chair Barker at 7:04 pm.
on Tuesday, October 10, 2017 in the Salah Meeting Room of Town Hall.
A. Approval of Agenda
Chair Barker reviewed the items on the agenda which included a Reserve Fund Transfer Request
requested by the School Committee, an update on the Blue Hills Regional School building project, a
review of the General Fund and Enterprise Funds' operating results for fiscal 2017 and an update on the
capital budget requests.
B. Announcements
Chair Barker announced that the Finance Committee by-law was changed so that the Finance
Committee was reduced from 12 members to nine members. Currently there are seven members on
the committee with 2 vacancies. Chair Barker stated that a member could join at any time after being
a ppointed by the Town Moderator.
C. New Business
Reserve Fund Transfer Request - $200,000— School Department- Dr. Fischer-Mueller stated that the
School Committee was seeking support for a feasibility study which was an unplanned expense due to
the results of the School Department's Facilities Master Plan study. Dr. Fischer-Mueller gave a
background on her work with staff for creating a strategic framework. In September the School
Committee had approved a Facilities Master Plan. Both the strategic framework and facilities master
plan were shared with parents, staff and the BOS. The School Committee is present before the Finance
Committee to learn more about the facilities in Canton and how the School Committee can create an
alignment between education vision values and facilities. Dr. Fischer-Mueller turned the discussion over
to Mr. Nectow.
M r. Nectow referred to the following meeting documents: Executive Summary from the draft of the
Comprehensive Facilities Assessment Study, a Timeline for Critical School Committee/Town Decisions
(Votes) and a 6-Year Capital Plan (2018 thru 2023).
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Mr. Nectow stated that after reviewing the many options available the School Committee voted in early September to move forward with the 5B1 option. Phase 1 of the 30-year master plan includes four projects: 1) renovation or building of a new Galvin Middle School, 2) conversion of the Rodman Building back to classroom space for use as an 8`h Grade Academy and 4) relocation of the Rodman Early Childhood Center from the Rodman Building to one or all of the elementary schools and 4) relocation of the Administration team from the Rodman Building to a location to be determined. The next step in the process would be to hire an architect to conduct a feasibility study. M r. Nectow explained that the feasibility study would include such items as 1) a review of the educational programs at the Rodman Early Childhood Center and the Galvin Middle School and use of building space to address educational/program needs 2) document conditions at the Rodman Building, 3)review space needs at the three elementary schools and 4) establish design for the Rodman Early Childhood Center and the Rodman Building. The Galvin Middle School Building would not be included in the feasibility study because the School Committee would be applying to the MSBA program in the first q uarter of 2018 and the School Department would most likely hear from the MSBA within a year or the first quarter of 2019. M r. Nectow reviewed the timeline and the preliminary costs. If the MSBA invites the Town into the program for the Galvin Middle School project, the School Committee would be looking for funding for a feasibility and schematic design at Town Meeting in 2018 or 2019 to hire a project manager and an architect. If that project moved forward the School Committee would be looking for funding the design and construction at Town Meeting to start in 2021 with completion in September of 2024. With regard to moving the Early Childhood Center out of the Rodman Building to another school location, the feasibility study would help to give the School Committee a better idea of the cost estimate and would seek funding at the upcoming Town Meeting 2018. The project would take approximately one year and the plan would be to occupy the new space in September of 2019. M r. Nectow stated that the feasibility study would also help the School Committee determine what to do with the Rodman Building as to what could be done with the building. The School Committee would be looking for the full design money at the Town Meeting in 2018. The School Committee would be seeking design funding at the Town Meeting in May 2018 and in Town Meeting 2019 the construction funding would be requested, with a 2-year construction timeframe and a plan on occupying the space in 2022. With regard to the Rodman Administration relocation project, Mr. Nectow stated that the Administration staff would be moved out of the building in September 2019. The feasibility study would help the School Committee to look at alternative options available for the Administration staff to move into. They are hoping that by May 2018 they would have a better idea of space being considered. There would be approximately 30 administrators that would have to be relocated by September 2019. M r. Nectow reviewed the Short-Term Master Plan Schedule and Projected Expenditures starting with the $200,000 being requested through a transfer from the Reserve Fund for the feasibility study. Additional funding of $6,125,000 would be requested at the ATM 2018 for fiscal 2019 for modular classrooms at one or more of the elementary schools, $2,880,000 would be requested for design funding for the Rodman Building conversion to an 8th Grade Academy and another $1,125,000 would be requested for design/construction and FF&E for relocation of the administration team. The total a mount the School Committee would be requesting at ATM 2018 is approximately $10 million. If the School Committee receives a response from the MSBA another $1.5 million for the feasibility/schematic design for the Galvin could be added to the $10 million being requested at ATM 2018. Approximately $30 million would be requested for FY2021 for construction of the conversion of the Rodman Building FINCOM 20171010 Minutes Page 2 of9 01/21/18
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for an 8th Grade Academy. In FY2021 $100 million would be needed for the construction of the Galvin plus another $1 million of FF&E and relocation expenses. The only project being considered for submission to the MSBA is the Galvin Middle School. If approved by MSBA the reimbursement rate would be approximately 40% or $40,000,000 reimbursed to the Town. The numbers presented by Mr. Nectow were gross numbers and did not take into consideration the reimbursement from the MSBA. The Town must fully appropriate for the cost of the project at Town Meeting. The total cost for Phase 1 of the Master Plan Schedule Phase I is a gross cost of $142 million with a pproximately $40 million being reimbursed from the MSBA. Chair Barker questioned if the Galvin Middle School project could be included in the initial feasibility so that all could be considered for a maximum utilization of resources for the final consideration. Dr. Fischer-Mueller stated that the feasibility study and the S01 for the Galvin are tied together. Ms. Gustafson asked for a summary for the primary drivers for each of these projects i.e. is it i nvolvement, condition of the buildings, programming. She further stated that the public needs to u nderstand the purpose of all of this. She also inquired as to what extent are the projects divisible that if a few projects are done and then the state does not agree for the funding for the Galvin Middle School project or the Town refuses to support. She also stated that the Timeline did not mention an override vote and in this instance this funding would have to be done through an override vote and that it could not be done within the levy. What would be the purpose of doing these projects if the Galvin Middle School project did not occur? Dr. Fischer-Mueller responded that the multiple drivers in their master plan include educational vision (for a changing world) and how education is changing as well as upgrading the buildings given their current date and the recent changes in enrollment. Education is responding to the changing needs in the world and the classrooms need to change and be flexible. The study also helped to provide the School Committee with information on capital improvements that need to happen. Enrollment shifts across elementary schools have occurred and overcrowding is an issue at the Middle School. The drivers in the Master Plan include: how education needs to be delivered, changes in operation functions of the facilities and shift in enrollment. Ms. Gustafson asked for clarification in the shifts in enrollment: Dr. Fischer-Mueller referred to demographic numbers from 2011 forward to 2016 a nd projected out to 2026 and 2027 the overall change across all the grades is 3,264 students and currently the district is at 3,271 which is a reduction across all of the grades. Changes across all of the elementary schools is occurring. The JFK has seen the most enrollment increase but JFK projected out 10 years has a decrease of 12 students while the Hansen School has had an increase but according to a projection there could bean additional 30 students and the Luce School has seen a dramatic reduction from 2011/2012 636 students (included one-half day kindergarten) to 500 students with a projection of 438 students which is a decrease of 12. Ms. Gustafson commented that across the district there were not large increases in student population. This comes back to why a different physical plant arrangement is needed in which to work and teach as opposed to having to build a new school because there are 500 new students. In Ms. Gustafson's opinion the feasibility study did conclude that a new building for elementary students was not needed, even though space was an issue. With regard to enrollment specifically, everyone was in agreement that there was not an existing student population at the elementary level that could not be accommodated at the middle and high school level. FINCOM 20171010 Minutes Page 3 of9 01/21/18
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Dr. Fischer-Mueller did state that the Galvin Middle School was a high priority for them in terms of a need for renovation and the educational shift. Decompression at the elementary level can come with the support of modular classrooms. Currently classrooms at the elementary level have been "sliced up" to accommodate student services. Ms. Thomas inquired as to how in depth the Master Plan examined the Rodman Building. Over many years the Rodman Building had been examined as to the condition and what functions could be done or not done within the space to make it a quality educational space. Dr. Fischer-Mueller stated that they d id not have actual plans of the Rodman Building to provide to the architect as to how the building was constructed. Further examination as to which walls are weight bearing walls in the Rodman still needed to be determined. The building did need a closer look but in terms of capacity it would be sufficient for the number of students they would be planning on for that building. I n response to a Finance Committee member's question as to the reason the SOI process would not be utilized for the Rodman Building Mr. Nectow responded that the School Committee felt that it was more responsible and economical to go for the new Galvin Building. Dr. Fischer-Mueller stated again that the plan is to house the pre-kindergarteners in either one or more of the elementary facilities if the 5th grade is moved to the Galvin Middle School with the 8th grade moved to the Rodman Building. The plan is to soften the transition for the 8th grade to the high school and to allow teachers to focus on their fundamental, academic and developmental growth and to have a well thought out plan and deliberate approach to the education of the 8Th grade. I n response to a Finance Committee member's inquiry about a connection from Building A to Building B, Dr. Fischer-Mueller stated that the feasibility study does address a connection between the high school and the Rodman. This would help to support travel to the cafeteria. There is no intention that the Rodman and the 8`h grade would be part of the High School. Ms. Fischer-Mueller shared with the Finance Committee a report from 1999 when there was a renovation of the High School in which the report stated that there were issues of safety moving from building A &Band that the goal was to eliminate outside traffic during the day and removing Building A from any future High School design. Ms. Gustafson, who was a part of the High School planning renovation encouraged the School Committee to research the previous work that had been done regarding the Rodman Building, including the structural condition of Building A that was evaluated by the prior project supervisor to avoid spending money for studies that have already been done. At that time a connection between the buildings was evaluated but deemed not feasible because of cost and fire access. Dr. Fischer-Mueller expressed appreciation for Mr. Sims attending the meeting and sharing the 1999 report with the School Committee and that they could learn from individuals that were involved in the process during the high school renovation. Dr. Fischer-Mueller stated that the School Committee had conducted eight meetings to inform the public about the Master Plan and that they have set up a site for the public to "feed" their questions into this site. The response has been great from parents and community leaders. M r. Nectow stated that the option 5B1 that the School Committee allows for that if the new middle school is not supported, but that the Sth Grade Academy is implemented freeing up this grade at the Galvin and the Rodman Early Childhood is moved out to the elementary schools, the 5th grade could still be moved into the existing Galvin Middle School. Ms. Gustafson concluded that the report was most critical of the Galvin Middle School specifically with the design. The School Committee would know in the first part of 2019 with regard to the MSBA approval. FINCOM 20171010 Minutes Page 4 of9 01/2l/18
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Resident Jim Sims commented that the first phase of the project could cost anywhere from $100 million to $142 million which could cost each taxpayer about $600 to $900 more in property taxes per year for the next 20 years This increase in taxes would not include any future debt coming on beyond the $100- 142 million. Mr. Sims stated that MSBA will not reimburse for administrative space, so if the plan to move the administrative staff into the Galvin Middle School occurs, it might reduce the amount that the Town receives from the MSBA for reimbursement. He referred to the study in that the study stated that the Galvin Middle School had more square footage than is needed for those enrolled, has more classroom capacity than is required for the current enrollment and in 2015 $4 million was approved for the addition at the Hansen but the MSBA would not reimburse the Town because classrooms were based on class size limits set by the Town's School Committee but that the Town could not qualify because the DOE recommends larger class sizes. The Master Plan states that enrollment is scheduled to peak in 2024 with the Middle School peaking around 2021, the time at which the Master Plan would be completed. Mr. Sims raised concerns with the renovation of the Rodman Building referring specifically to the $1 million cost to renovate just the heating system in the Rodman. He stated that 17 years ago it was determined that the Rodman Building could not or should not be converted based on the letter from the Commissioner of Education in 2000 because it would not be economically worth any kind of conversion and that they recommended it be made a school administration building. M r. Loughran stated that if in 2019 the Town finds out that they are not accepted into the MSBA program for the Galvin Middle School project they would delay it and apply the following year. Mr. Sims spoke in support of delaying the $200,000 Reserve Fund Transfer until Town Meeting and asking for the funds at that time from the Reserve Fund or from free cash rather than depleting the Town's Reserve Fund. Mr. Loughran spoke in favor of the project with support from not only the parents but the taxpayers because everyone would benefit from this project. Dr. Fischer-Mueller stated that the feasibility study would help the Town decide the option that would be preferred and that questions raised at the Finance Committee meeting would be answered by the feasibility study with a greater level of detail. M r. Sims stated that the plan did not address the land/construction costs of building a new school. He inquired if the School Committee had inquired about the Gridley School being utilized as temporary space for two years for the administrative staff. M r. Nectow is hopeful that the feasibility study would be completed before Town Meeting so that they would have an idea of the costs estimates. A warrant article would be submitted. I n response to Ms. Gustafson's inquiry about the $100,000 being requested for the feasibility study for the modular portion as compared to $75,000 for Rodman conversion and $25,000 for Rodman administration relocation, Mr. Nectow stated that there would be a more fully developed plan for the modular classrooms as to layout and solid cost estimates. The feasibility study would determine which elementary facilities would need these modular classrooms. The purpose of the modular classrooms would allow more flexible learning space. This also assumes that the Pre-K would come out of the Rodman Building as part of this feasibility study. M r. Nectow is hopeful that the $75,000 for the Rodman 8th grade feasibility study would give more in- depth information in concept, not design, beyond the Master Plan with information from structural engineers, electrical engineers and plumbing expertise as to in what would be needed to convert the Rodman Building to an 8th Grade Academy. The School Committee is not expecting a full design from the feasibility study but a "go" or "no go" for the project. Ms. Gustafson inquired if a cafeteria or a gym would be included in this study. Mr. Nectow is hoping that the feasibility study for the Rodman relocation of administrative staff would give the School Committee options of where to relocate. FINCOM 20171010 Minutes Page 5 oY 9 Ol/21/l8
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Ms. Gustafson is concerned that the $200,000 may not be enough to give the School Committee the kind of information needed to make the decisions it would need. Dr. Fischer-Mueller agreed that it is critical that the feasibility study contain enough information for the School Committee to be able to make decisions and that they will be working closely with the consultant to make sure that they will be producing a report that will be useful for the School Committee to make those final decisions. Ms. Thomas made the point that it may not make sense to conduct the $25,000 feasibility study for administration relocation if it was not being recommended to go forward with the 8`n Grade Academy in the Rodman Building. Mr. Nectow explained that some of the process is driven by how the funds have to be appropriated and that if the School Committee waited until Town Meeting for the appropriation for the study you would not have time to do the work Chair Barker stated that the School Committee would have to address the public perception for the need of a new elementary school in the east section of Canton, as that has been the discussion for a n umber of years, despite the numbers for enrollment not really supporting the need for a new school. Ms. Gustafson, based on the study, spoke in favor of the School Committee focusing its efforts on evaluating the A Building and determining the MSBA support for the renovation of the Middle School. Chair Barker summarized as follows: four different projects, three that are "ancillary" and one project, the Galvin Middle School is the priority with regard to feasibility. Ms. Gustafson questioned if this feasibility study request met the scope of the purpose of the Reserve Fund and was the request an emergency. Mr. Murgia mentioned that this could have been a request from free cash at a special town meeting, but there were no plans made by the BOS to hold a special town meeting. He also suggested that the School Committee could have paid for this out of their operating budget and if it created a budget problem for the Schools, they could ask for a budget supplement at Town Meeting or return to the Finance Committee for a reserve fund transfer later in the fiscal year. There were concerns at utilizing the Reserve Fund so early in the year, not knowing other budget issues that might occur in the remainder of the fiscal year. M r. Nectow explained that with an S01 you do not state if a new or renovation is to occur. If you are accepted in, then the feasibility study is done at which time it is determined to build or renovate. Mr. McKenna inquired if the Finance Committee did not vote to support the reserve fund transfer, would the School Committee still move forward or would they be able to find the funds within their budget. Ms. Fischer-Mueller explained that over 80% of the School Department's budget is defined by FTEs and salaries so there is very little cushion in their budget to come up with the $200,000 to fund this study. This is a high priority for the School Committee with the timing being crucial and the School Committee would not want to delay this for a full year. Chair Barker spoke in support of using the Reserve Fund in order to "jump start" this project but the preferred source of funds would have been free cash. Ms. Thomas spoke in support of splitting the difference and funding $100,000 out of the Reserve Fund and $100,000 out of the School operating budget to avoid compromising the Reserve Fund so significantly at such an early point in the fiscal year. Chair Barker expressed that there was a willingness among the Finance Committee members that if the School Department had to return to the Finance Committee towards the end of the year for a transfer for $100,000 and the funds were available it would most likely be supported by the Finance Committee, b ut there were no guarantees that the money would be available. A motion made by Mr. McKenna to approve a $200,000 transfer from the Reserve Fund to the School Department for a feasibility study was seconded by Ms. Thomas. FINCOM 20171010 Minutes Page 6 of9 01/21/18
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Ms. Holcombe made an amendment to approve a $100,000 transfer from the Reserve Fund to the School Department budget for a feasibility study which amendment was seconded by Ms. Gustafson. Vote: 5-0-0. Dr. Fischer-Mueller thanked the Finance Committee for their vote of support and that this was a show of support to get the answers to many questions that had been put forth during the meeting. Blue Hills Regional Technical School —Update on Proposed Building Renovation Protect — Mr. Murgia gave an overview of the Blue Hills Regional Technical School building renovation project. The MSBA gave approval for the $85 million project for which Blue Hills would receive reimbursement of a pproximately $43 million or 50-55% of the project. The balance for the project would be shared among the nine member communities. Canton's share of the cost would be approximately $150,000 per year or 7% of the remaining project cost. If no action is taken by the local legislative body of all nine member communities within 60 days of the a pproval voted by the Blue Hills School Committee, automatic approval of the Blue Hills bonding decision would occur. If any member of the district community voted not to support the project, Blue Hills would be required to fund a district wide vote. Members of Blue Hills recently attended the BOS meeting, at which time the BOS was in support of the project but did not take an official vote on the project. General Fund's Fiscal 2017 Operating Results - Mr. Murgia reported that 2017 was a good year for the Town with revenues exceeding expenditures by $500,000. The budgeted deficit of $2.5 million was offset by surplus revenue of $2.5 million. Departments turned back approximately $476,000 which i ncluded the Reserve Fund with a $220,000 remaining balance at the fiscal year end. Free Cash reserves at year end are estimated to be $4.7 million, Stabilization was $7 million and the Surplus Overlay Reserve with $3.7 million for a combined reserves total of $15.4 million or 17% of budget. Enterprise Funds' Fiscal 2017 Operating Results - Mr. Murgia reported that the Water Enterprise Fund ended the fiscal year with a deficit of $27,677 which was better than the budgeted deficit of $800,000. The Water Enterprise revenue for FY17 was $7 million or $630,000 better than the $6.3 budgeted revenue. The Water Enterprise ended the fiscal year with a cash reserve of $1.8 million. The Sewer Enterprise Fund ended the year with a deficit of $85,306 due to reduced spending. Sewer salaries and debt service ended the year more favorably than budgeted for. The Rink Enterprise Fund ended the year with a $53,000 surplus due to the Zamboni being sold within the fiscal year. D. Other Business/Open Issues ATFC Annual Conference —Three members of the Finance Committee would be attending the Association of Town Finance Committees Annual Conference on October 21. Budget Timeline — Mr. Murgia reviewed the budget timeline with the Committee with the following dates as key dates: January 12 —municipal operating budget to the Finance Committee; January 19 — school operating budget to the Finance Committee; January 26 —revenue estimates to the Finance Committee; during February the Finance Committee would discussed the revenue estimates; FINCOM 20171010 Minutes Page 7 of9 01/21/18
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and March 1 —the Capital Planning Committee would be presenting their recommendations to the
Finance Committee.
Informational Meeting re~ardin~ Town Meeting — Mr. Murgia discussed that the Finance Committee
may want to host an information Meeting after the Town Meeting Recommendations are delivered to
the residents and prior to Town Meeting. This would bean informal meeting that would take place at a
location such as the library and would include a member of the Board of Selectmen, Planning Board
Member, School Committee member and article sponsors. This forum would not be for debating the
merits of an article but as an informational meeting for the public to learn more about an article.
New Open Meeting Law Regulations -The Attorney General issued new Open Meeting Laws that took
effect October 6th. Finance Committee members were asked to submit a certificate to the Town Clerk's
office.
Approval of Minutes
A motion made by Mr. McKenna to approve the minutes as written for July 26, 2017 was seconded by
Ms. Gustafson. Vote: 3-0-2. Two members abstained as they were not in attendance for the July 26tH
meeting.
Next Meeting Date: The next meeting date would be decided in the near future.
Adjournment: A motion made by Mr. McKenna to adjourn the meeting at 9:17 p.m. was seconded by
Ms. Gustafson. Vote: 5-0-0.
Minutes reviewed by: Rob Barker
Respec Ily submitted,
~~
Rob Barker
Chair, Canton Finance Committee
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Canton Finance Committee Meeting
Tuesday, October 10, 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).
Timeline for Canton School Committee/Town Decisions (Votes) dated September 22, 2017 (1 page).
6-Year Capital Plan (2018 thru 2023) as of September 26, 2017(Master Plan Related Projects Only (1 page).
Current Debt Exclusions as of October 2, 2017(1 page).
Reserve Fund Transfer Request - $200,000 —from the School Committee for a feasibility study (1 page).
Memorandum from the Canton School Committee to the Finance Committee regarding a request for funds for a
Feasibility Study, dated October 4, 2017(2 pages).
Executive Summary —Comprehensive Facilities Study (26 pages).
Blue Hills Regional Technical School —Project Cost and Borrowing Schedule and other information related to the
$84 million building renovation project(16 pages).
Memorandum from Jim Murgia to the Board of Selectmen regarding the General Funds' Fiscal 2017 Operating
Results, dated August 31, 2017(10 pages).
Memorandum from Jim Murgia to the Board of Selectmen regarding the Enterprise Funds' Fiscal 2017 Operating
Results, dated August 30, 2017(3 pages).
Memorandum from Jim Murgia to Departments, Boards, Committees, dated September 19, 2017(7 pages).
Finance Committee Liaison List dated October 4, 2017 (1 page).
Fiscal 2019 Budget Timeline provided by the Finance Director (2 pages).
E mail from Town Clerk to Boards &Committees regarding the new Open Meeting Law regulations recently issued
by the Attorney General(2 pages).
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