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February 28, 2017, Finance Committee Meeting. Minutes
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Town of Canton Finance Committee Ivt~nutes voted on: 3/16/17
Meeting Minutes vote: 5-0-0
Tuesday, February 28, 2017
Members Present:
Rob Barker, Nichols Gallagher, Dianne Gustafson, Cynthia Holcombe, Stephanie Leach, Tim McKenna,
Barbara Saint Andre and Cindy Thomas.
Members Absent:
Jerry Dorfman.
Guests Present:
Derek Bonner, Vice President, Fresenius Kabi Compounding
Jessica Craw, Ernst &Young
Jim Fitzpatrick, Board Member, Council on Aging
Gene Manning, Chair, Economic Development Committee
Nick Pirelli, Acting Director, Parks &Recreation
Dick Staiti, Esq.
Diane Tynan, Director, Council on Aging
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
7:02 p.m. on Tuesday, February 28, 2017 in the Salah Meeting Room of Town Hall.
A. Approval of Agenda
Chair Saint Andre reviewed the items on the agenda —Council on Aging Budget, Parks &Recreation
Budget, Economic Development Committee Special Tax Assessment, voting on various articles and the
recent bond sale.
B. Announcements
There were no announcements.
C. New Business
FY18 Council on Aginq Budget Request — Ms. Tynan, Director of Council on Aging, introduced Mr. Jim
Fitzpatrick, a Council on Aging Board Member. Ms. Tynan presented statistics (see meeting handout)
regarding the increased census population of individuals 60 and older in the Town of Canton (23.9°/o
increase between 1990 and 2000 and a 19.9% increase between 2000 and 2010), the increased number
of individuals the COA has served, events provided, rides provided and trips arranged. The Council on
Aging also provides other services to individuals under age 60 and disabled individuals. Those services
include transportation, food stamps, fuel assistance, social services, etc.
The Council on Aging currently has three passenger buses, one 12-passenger van and a car. Ms. Tynan
provided detailed information regarding bus drivers' salaries from 2014 through 2017(see meeting
handout). Ms. Tynan is requesting a $26,200 increase to the Bus Drivers Salaries budget line item for
FY18. The Council on Aging receives $49,000 of grant money from the Massachusetts Executive Office
of Elder Services. From this grant money, Ms. Tynan has been using $18,000 of those funds to cover
some of the costs for the bus drivers' salaries to meet increased demand for transportation. Ms. Tynan
would rather utilize this $18,000 for expanding services at the Senior Center. She would like to hire
temporary licensed social workers, hire temporary staff for offering additional programs, extend Senior
Center hours until 6:00 p.m. (two Wednesdays per month) to offer dinners through the HESSCO program
and to have the Senior Center open one Saturday per month from 9-1 p.m.
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Article 19 —Vote to Approve Senior Citizen Property Work-Off Abatement Program — Ms. Tynan
stated that the Board of Selectmen and the Board of Assessors were the sponsor of Article 19 but that
she fully supports this article. Currently there are 110 seniors that participate in the work-off abatement
program fora $1,000 real estate tax abatement per individual. These abatements are paid out of the
Assessor's Overlay. Ms. Gustafson inquired if there would be an increase to the number of hours the
seniors work under the program (100 hours). Mr. Murgia stated that under this program the state would
not allow towns to pay more than the state's minimum hourly wage. The number of hours the seniors
would be required to work would depend on that minimum hourly wage. If the minimum wage were
$11.00 per hour, the senior would be able to work as many hours up to $1,500 per year.
Even though the abatement program has been in existence for a number of years in Canton and the
Town had previously adopted this statue at a previous Town Meeting, the Town must accept this again
because there may be a new provision to the program. Ms. Tyan explained that a representative may
work for a senior that may be physically unable to work the program.
Ms. Thomas pointed out that a clause in the statute states the maximum reduction of the tax bill would be
based on a maximum of 125 hours. This would help alleviate the Town having to return to Town Meeting
for an amendment.
Ms. Tynan extended the invitation to members to visit the Center if they have not done so already. The
budget and article discussion with Ms. Tynan and Mr. Fitzpatrick ended at approximately 7:22 p.m.
FY18 Parks &Recreation Budget — Mr. Pirelli thanked the Finance Committee for inviting him to their
meeting. Mr. Pirelli gave a brief overview of some of the exciting programs that Parks &Recreation will
be offering during the upcoming months: a Barn Dance at the Pappas Rehabilitation Center with a live
caller, Senior Center bus trips, live streaming of the 4~h of July celebration, Edge Extreme program for
older youths, etc.
Mr. Pirelli's FY18 budget request for the Youth Services Budget is to level fund the budget.
With regard to the Parks &Recreation FY18 budget, Mr. Pirelli is requesting the following changes:
• $8,500 increase to the Part Time Workers budget line item -Two college students will assist the
current maintenance staff. This had previously been charged to the Recreation Revolving Fund.
• $5,000 increase to Lifeguards Salaries budget line item —This will help to designate Canton's
learn to swim program as a Red Cross program. In response to Mr. Barker's inquiry if Canton's
learn to swim program was in direct competition with any programs offered at the Blue Hills
Regional School, Mr. Pirelli stated that he had not asked for program costs or enrollment
numbers from Blue Hills.
• $2,000 increase to the Overtime Salary budget line item —This request was based on a 3-year
average.
• Various miscellaneous increases to expense line items based on historical averages, need based
and increased costs - $2,000 increase to Electricity, $1,000 increase to Building Repairs &
Maintenance, $1,000 increase to Building Supplies, $2,000 increase to Playgrounds for wood
chips and equipment and $1,000 increase for field line painting supplies.
• $1,500 increase to Communications budget line item for playground surveillance — Mr. Pirelli
stated that there is a need for surveillance at the playgrounds. The cameras would be on motion
sensors, would not be monitored by individuals on a 24-hour basis, would have storage capacity
of approximately two weeks and would provide quality resolution and video. The main purpose of
the cameras and posted signage would be for deterring vandals and for use after an incidence
occurrence to catch vandals.
I n response to Chair Saint Andre's inquiry as to how long these videos would be kept as a public record
and was there consideration given as to the legality of storing images of children, Mr. Pirelli stated that he
would get back to the Chair on this issue. He stated that there would be a sign placed at all locations
where cameras were posted and that a disclosure notice would be placed on the Town's website.
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Article 27, Motion 8 —Canton Little League Restroom at Kennedy Field — Mr. Pirelli suggested that a
memorandum of agreement needed to be reached among the Parks &Recreation, the School Committee
and the Canton Little League with regard to the construction, care, maintenance, staffing etc. of a new
building at the Kennedy Field. Currently the Parks &Recreation is responsible for the maintenance of the
grounds at the Kennedy Field. With the addition of a private building on the grounds, more questions
than answers have arisen over this project. Would there be additional operating costs in a budget such
as the Parks &Recreation budget for the upkeep of this new building? Who would be responsible for this
building? Who would maintain keys and access to this building? Is this building just for restrooms and
storage or would it be for concessions as well? Who would be responsible for trash if it is used for
concessions?
It was conveyed to Chair Saint Andre during a recent conversation with the Chair of the Community
Preservation Committee that the School Committee would be in charge of the building project and that
the grant money received from the Community Preservation Committee and any other dollars raised
would be controlled and spent by the School Committee.
Furthermore, it was stated to her that the CCPC would have explicit details spelled out in the grant award
agreement.
FY18 Rink Enterprise Budget — Mr. Pirelli stated that the DCR is still exploring four possible sites for a
new rink —three in Canton and one in Norwood. The BOS already voted to support a new rink in Canton.
The state would be issuing the results of their feasibility study in the near future. Mr. Pirelli stated that
they are still in the process of selling the Zamboni and is hopeful that it will sell for approximately $50,000.
Article 14 —Approval for Funding for the Annual 4t" of Julv Community Celebration — Mr. Pirelli is
seeking funding of $35,000 for the 4 of July to cover expenses such as fireworks, inflatables, light
towers, maintenance staff salaries, golf carts, gifts for the children etc. Although there is currently no
private funding for the 4`h of July celebration, Mr. Pirelli is in support of public/private partnerships and will
be exploring these partnerships in the future.
Article 57 —Amend General By-Law XVI, Section 24(Canton Alliance Actainst Substance Abuse)-
Mr. Pirelli stated that the main purpose of this article was to amend the titles of officers on the CAASA so
that they would be more in alignment with titles of officers on other Town committees. He also stated that
he was level funding the CAASA budget for FY18 so there would be no increase to the budget of
$10,000.
The discussion with Mr. Pirelli ended at approximately 7:58 p.m.
Article 21 —Special Tax Agreement ISTA) with Fresenius Kabi Compounding —Gene Manning,
Chair of the EDC, was accompanied by Derek Bonner, Vice President of Fresenius, Jessica Craw of
Ernst and Young and Dick Staiti, Esq. Mr. Manning gave an overview of the Special Tax Agreement that
the Board of Selectmen will be seeking Town Meeting approval for as follows:
• The STA agreement negotiation process was started 18 months ago for a building located at 20
Dan Road.
• The STA has been approved by the Massachusetts Executive Office of Housing and Economic
Development.
• The agreement has been reviewed and approved by the Board of Selectmen, Board of Assessors
and Town Counsel.
Mr. Bonner introduced himself and provided the following information regarding Fresenius and the startup
activities at 20 Dan Road:
• Fresenius, a Germany-based company, is a $30 billion worldwide business.
• The company currently operates a dialysis business in Waltham.
• Kabi provides hospital supply products such as generic intravenous drugs.
• The Canton facility will focus on compounding/mixing which are then transferred into fusible form.
• Fresenius has 18 compounding centers worldwide.
• The company has entered into a partnership with Partners Health care which includes Brigham
and Women's and Mass General Hospital.
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• Fresenius has also entered into a 10-year lease with options with Real Estate Investment Trust of
Cleveland, OH for a portion of the building at 20 Dan Road.
• They have submitted to the Town construction permits and demolition has commenced at the
site.
With regard to the Special Tax Assessment Agreement:
• The STA agreement states that Fresenius will be investing $4.1 million in construction, renovation
and other hard development costs with another $4.4 million invested for machinery, equipment,
furniture and fixtures at the property. Mr. Bonner estimates that it could be more in the area of
$15 million instead of $8.5 million.
• The STA exemption/abatement will start July 1, 2018 with afive-year descending schedule of a
50%tax abatement in year 1, a 40%tax abatement in year 2, a 30% tax abatement in year 3, a
20% tax abatement in year 4 and a 10%tax abatement in year 5. Years 6-10 will be taxed at the
full taxable value of the building.
• Current valuation is at $6.5 million with Fresenius investing another $8.5 to $15 million.
• The building has been vacant since 2011. Fresenius will be creating a positive revenue stream.
• Projected taxes will be approximately $395,000 per year. In year 1 a 50% abatement would
result in $197,000 of taxes, year 2 at 40% abatement $158,000, year 3 at 30% abatement
$118,000, and in year 4 at 20% abatement $79,000 in taxes. In year 5 with an increased
valuation, there could be as much as $539,000 in taxes.
• Claw back clause — In response to an inquiry from a Finance Committee member as to whether
the STA agreement contained language in the form of a "claw back" term to protect the Town in
the event that the taxpayer decides to vacate the premises prior to the end of the STA
Agreement, Mr. Manning stated that the Town was protected and the agreement did contain such
a clause.
• Additional STA — Mr. Manning stated that Fresenius was committed to a long term relationship
with the Town and that it was unlikely they would be looking for an extension of the STA or TIF.
• Memorandum of Understanding —The Memorandum of Understanding included items such as
a $1,000 Student Scholarship per year for fiscal years 2019 through 2023; 2) local preference for
hiring; 3) a single $5,000 donation to the Canton Senior Center in calendar year 2017; 4) a
membership to CABI (Canton Association of Business and Industry) for 2019 through 2023 and
5)an annual report file by Fresenius with the Town by January 31S` of every year. In response to
an inquiry as to why Blue Hills Regional High School was not considered for an annual Student
Scholarship, Mr. Manning would work on implementing this.
• A Finance Committee member inquired about schools to careers. Mr. Bonner stated that they
would be willing to select students for tours through the facility.
The discussion with Derek Bonner, Jessica Craw and Dick Staiti ended at approximately 8:25 p.m.
Article 58 —Amend Additional 43D Priority Development Sites — Mr. Manning will be presenting two
parcels for designation as 43D priority development sites for approval at Town Meeting.
• The two parcels (42 acres) are at the Reebok site.
• If approved at Town Meeting this designation will help market the properties with the commitment
that guarantees a new owner a decision in 90 days for permitting purposes through the various
boards.
• Reebok's owner, Adidas, has agreed to be willing to work with the Town to facilitate this process.
• A broker has recently been assigned for marketing the property. Currently, there are no definitive
plans for the property. The property is not zoned as residential.
• A Finance Committee member inquired that if the property were not sold, would leasing be an
option. Mr. Manning thought that leasing could be an option.
• Another Finance Committee member inquired if some of the other boards, such as the
Conservation Commission or Planning Board, have weighed in on the marketing/sale of this
property. Mr. Manning did not think that they have given opinions on this site.
• Mr. Manning stated that Boston Mutual is still moving forward with the hotel being proposed near
Reebok.
• Mr. Murgia stated that in a recent conversation with S&P Bond Rating Agency they were pleased
that the Town will be taking action at Town Meeting with regard to these parcels.
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The discussion with Mr. Manning regarding the 43D Priority Development Sites ended at
approximately 8:38 p.m.
The Finance Committee discussed and voted the following articles:
Vote —Article 14 —Approval of Funding for the Annual 4th of July Community Celebration
A motion made by Mr. Barker that the sum of Thirty Five Thousand Dollars ($35,000) be
transferred from Free Cash (Undesignated Fund Balance) to be expended by the Finance Director
as Chief Procurement Officer, with the approval of the Board of Selectmen,for the July 4:n
community celebration in 2017 with the intent that said funds shall be available in FY17 in
anticipation of July 4, 2017 was seconded by Ms. Gallagher. Vote: 8-0-0.
Vote —Article 21 —Vote to Approve a Special Tax Agreement with Fresenius Kabi Compounding
A motion made by Ms. Gallagher to recommend that the Special Tax Agreement as written in the
warrant be recommended to Annual Town Meeting was seconded by Mr. Barker. Vote: 8-0-0.
Vote —Article 27 Motion 8 —Canton Little League Bathroom and Storage Facilities —Kennedy
School
The Finance Committee did not take a vote on Article 27 Motion 8. They decided to wait until the School
Committee meets with them on March 8`h so they can further discuss with the School Committee as to
who would be responsible for overseeing the construction of the project, if the scope of the project
included a concession stand and who would be responsible for the maintenance of the building on an on-
going basis.
Vote —Article 37 —Vote to Amend Article 2, Section 1 of the General By-Laws (Annual Town
Election, Time of►
The Finance Committee did not take a vote on Article 37 because they are awaiting Town Counsel's
opinion on the legality of Article 37.
Vote —Article 57 —Amend General By-Law XVI, Section 24 (Canton Alliance Against Substance
Abuse
A motion made by Ms. Gallagher that Article XVI, Section 24 Paragraph (d) Organization of the
General By-Laws be amended by deleting the words "President Secretary and Clerk" and
inserting in place thereof the words "Chairman, Vice-Chairman, Clerk and Treasurer" was
seconded by Ms. Thomas. Vote: 8-0-0.
Vote —Article 58 —Amend Additional 43D Development Sites
A motion made by Mr. McKenna that the Special Tax Agreement as written in Article 58 be
recommended to Annual Town Meeting was seconded by Mr. Barker. Vote: 8-0-0.
Vote —Article 7 Motion 2 —Set Salaries of Elected Officials
The Finance Committee has discussed Article 7 Motion 2 at a few meetings. There had been some
discussion by the Committee about "grandfathering" elected officials currently in office that are receiving
salaries and vote subsequently elected officials not receive a salary. Chair Saint Andre inquired Town
Counsel's legal opinion. Town Counsel responded through an email with the following comments:
This article is a routine annual appropriation article for elected officials and provides the means only
to appropriate money for the upcoming fiscal year - or the voters can choose not to appropriate
that money -and cannot as proposed in the question appropriate money for future years -each year
has to stand on its own footing. We cannot in such a routine appropriation article for elected
officials decide now that certain people will in the future -including as much as three years in the future
- be paid amounts from annual budgets not yet appropriated while others holding the same
position not be paid amounts from future annual budget appropriations for elected officials not yet
voted.
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A Finance Committee member requested that the Finance Committee's discussion for this article contain
information about the potential liability for benefits costs for elected officials.
A motion made by Ms. Saint Andre that the salary and compensation for all part-time elected
officials of the Town be fixed for the 2018 Fiscal Year beginning July 1, 2017 through June 30,
2018, as follows:
Board of Assessors $2,400.00,for each member
Board of Health $600.00, for each member
Board of Selectmen $1,400.00, for each member, with an additional
$200.00 to chairperson
Planning Board $0.00
School Committee $0.00
Library Trustees $0.00
was seconded by Mr. McKenna. Vote: 5-2-1. Mr. Barker and Ms. Nichols voted against this motion
while Ms. Holcombe abstained from the vote.
Vote —Article 11 —Authorize Certain Revolving Funds —The state's Modernization Act allows the
Town to set up a Revolving Fund By-Law with the interest earned credited to the General Fund. A by-law
based on a template provided by the Division of Local Services, Department of Revenue, was presented
to the Finance Committee.
Article 11, Motion 1
A motion made by Ms. Gallagher that the Revolving Fund By-Law as written in Article 11 motion 1
be recommended to Annual Town Meeting was seconded by Mr. McKenna. Vote: 8-0-0.
Article 11, Motion 2 —Motion 2 sets out the annual fiscal spending limits for the Revolving Fund. There
were increases to two funds as follows: Library from $50,000 to $75,000 and Parks &Recreation from
$400,000 to $500,000. The reason for these increases were to allow for the increase in donations being
made to these funds. Transfers from these revolving funds, such as the $35,000 annual transfer from the
Greenlodge Street Parking Fees revolving fund to the General fund are carried out in a Transfer article at
Town Meeting. If a different use of these funds was to be proposed in the future a by-law change would
be necessary. A Finance Committee member expressed concern if committee and departments were
aware of transfers and by-law changes. The Accounting Department monitors the spending from and the
purchase orders charged against the revolving funds to assure that inappropriate charges are not being
made to these funds.
A motion made by Mr. Barker that the Revolving Fund FY18 Spending Limits as written in Article
11 Motion 2 be recommended to Annual Town Meeting was seconded by Ms. Gallagher.
Vote: 8-0-0.
S&P AAA Bond Rating &Results of $8,085,000 February 27 Bond Sale (see meeting handouts)
Mr. Murgia presented information regarding the Town's recent bond rating and bond sale as follows:
• Before the Town went out to bid for the bond sale, S&P gave the Town a bond rating of AAA,
upholding its current rating (see meeting handout).
• A General Obligation Municipal bond sale took place on February 27`h for a total of $8,085,000.
• The Town received 10 bids.
• Projects included under this bond sale (see meeting handout) included a $3.6 million addition to
the Hansen School Addition, $2.6 million Mechanic Street water mains, a $700,000 fire engine,
$600,000 High School Turf Field and Track etc.
• The low bidder was Sun Trust Robinson Humphrey at a true interest cost of 2.53%.
• The high bidder was Fidelity Capital Markets at 2.72%.
• The Town received a bond premium of $300,000 which offset the total interest cost of
$2,279,813.75 to $1,979,304.15.
• Currently the excess bond premium results in surplus revenue. In the future under new rules
bond premiums can be used to reduce the amount borrowed.
• There are also 2009 bonds which are being considered for refinancing on March 20th. Bonds
that are issued with 20 year terms are callable (able to be refinanced) after 10 years.
Chair Saint Andre congratulated Mr. Murgia on the AAA bond rating.
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Article 19 —Vote to Approve Senior Citizen Property Work-Off Abatement Program -
A motion made by Mr. Barker that the Senior Citizen Property Work-Off Abatement Program as
written in Article 19 be recommended to Annual Town Meeting was seconded by Ms. Thomas.
Vote: 8-0-0.
D. Other Business/Open Issues
E. Approval of Minutes
A motion made by Ms. Thomas to approve the minutes as written for February 22, 2017 was
seconded by Ms. Leach. Vote: 5-0-3. Ms. Gustafson, Mr. McKenna and Ms. Gallagher abstained.
F. Next Meeting Date: The next meeting would take place on Thursday, March 2, 2017 at 7:00
p.m. in the Salah Meeting Room of Town Hall to discuss planning and zoning articles with Jeremy
Comeau and Laura Smead.
Adjournment: A motion made by Ms. Gallagher to adjourn the meeting at 9:21 p.m. was seconded
by Mr. McKenna. Vote: 8-0-0.
Minutes reviewed by: Nichols Gallagher
Respectfully submitted,
~i T
l ~.- ~
,L y ~~ ~,~
Ba~ .~
a ~aint Andre
Chair, Canton Finance Committee
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Town of Canton
Finance Committee Meeting —Tuesday, February 28, 2017
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).
Voting Checklist dated 2/27/17(2 pages).
Council on Aging —Bus Drivers Salary Information, provided by Diane Tynan (8 pages).
Canton Council on Aging — PowerPoint slides, provided by Diane Tynan (8 pages).
Special Tax Assessment Agreement, dated February 2017 (7pages).
Memorandum of Understanding between Town of Canton & Fresenius Kabi Compouding (3 pages).
Article 7 Motion 2 —Set Salaries of Elected Officials, Email from Paul DeRensis to Charlie Aspinwall
dated 2/21/17(2 pages).
Article 7 Motion 2 -Draft -Set Salaries of Elected Officials, dated 2/27/17 (1 page).
Article 11 —Draft —Authorize Certain Revolving Funds, dated 2/27/17(3 pages).
Article 14 —Draft —Approval of Funding for the Annual 4`h of July Community Celebration, dated 2/23/17
(1 page).
S&P Global AAA Bond Rating Report, dated 2/17/17(7 pages).
Bond Sale Results for $8,085,000 Bond Sale on 2/27/17(3 pages).
Draft Finance Committee Minutes for February 22, 2017(6 pages).
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