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HomeMy WebLinkAbout2017-12-05 Finance Committee Minutes TOWN OF NORTH ANDOVER FINANCE COMMITTEE Meeting Minutes Meeting Date December 5th, 2017 Meeting Location: Police Station's Community Room, 1475 Osgood Street Timothy Tschirhart, TT, Chairman X Ed MacMillian EM X Jennifer Goldinan, JG, Vice Chair X Divya Bhatnagar, DB X Karin Blake, KB X Charles Trafton CT X Thomas Ringler, TR X Angela Ciofolo, AC X Liz Gerron, LG X Sasha Weinreich, SW X Note: All FINCOM votes are subject to change upon receipt of new information. Note: Documents used in this meeting are listed in Document Table, herein. Non Finance Committee Members in attendance Andrew Maylor (AM), Town Manager Eric Kfoury, (EK), Community Development Director Call to order 6:56 Annual Town Five Year Financial Forecast-Andrew Maylor and Economic Development-Eric Kfoury Discussion starts on or about 6:57 pm/00:24 on video time TT: Directing the question to The Town Manager(AM), Andrew Maylor, what can you tell us about the 5 year forecast? AM: Started out saying that the forecast holds a fairly consistent sort of methodology which is reasonably close to doing or getting to where we need to get to in the current year. AM: Spoke of revenue estimates and cost estimates, also stating that they look at 5 year averages. AM: Also talked about governmental funding, stating that we have done well and have incrementally increased our budget and service levels. It is called the "Science of muddling through", we are a little incremental by style. TT: Asked of the average increase in operating expenses AM: Responded 3.5 to 4%,but larger departments such as Schools, DPW, Police and the Fire Department are higher. I December 5,2017 AM: Spoke of Local Receipts, and explained that they are motor vehicle excise tax, and that they are the largest components of local singular revenue that are non property tax. AM: Went on to say that Motor Vehicles excise tax tells us a story of the economy When things are good we buy cars, we buy new cars (we hold them for less time), we buy cars for our children. We have seen a general trend up on this. AM: Explained"New Growth"when additions or improvements are made on to properties, the addition of the cost of the permits and also the additional tax that is associated with that improvement or addition. EK: Stated that building Permits are up by about 200 more from last year. AM: Regarding building permits AM spoke of some of the big projects in town, and also, how it can sometimes be difficult to project building permits ahead of time, so many different scenarios. TT: With all the excess permits where does the money get spent, what do you foresee? Is it capital, operating? AM: Spoke of the past and how at one point we had negative money and how we would spend every dollar and borrow. Now the approach has changed and now we set aside dollars first and set up floors and ceilings (so we do not get too crazy on things), and we are going to grow in a way that makes sense, and have reserves. We have budgets that are more responsible. AM: Spoke of having the proper reserves, also spoke of flexibility that helped us make decisions or when opportunities arise (example such as the kindergarten project), or when problems exist. AM: Spoke of taking care of safeguards and risks and how we can now take and use reserves for responsible projects. AM: Commented that 76% of revenue comes out of property taxes. AM: We do try to be conservative, and are cautious such as not to be aggressive on hiring too many employees, because employees have cost beyond salary. AM: Stated 60%to 70% are employee cost. The Committee commented and asked a variety of questions to AM regarding the budget and Finances of the Town. AM: Our average repayment when borrowing money is about 11 years. We only ask for what we need when we need it. AM: Spoke of Capital Plan and that every project approved has to be substantially complete in 18 months. AM: Commented that we need to pay attention to fundamentals and that we should not be borrowing money that you cannot afford to pay. TT: What do you see in the upside that is not in your forecast? EK: Replied back stating that he feels most positive about on the mills on High Street. 2 December 5,2017 EK: Spoke of the 2 major corporations that left over 300,000 square feet empty. We were able to turn that around and we now have over 90 companies, with a variety of mixed use such as offices, manufacturing to restaurants. They also have about 60 residential units. We have 100% occupancy on the East side and about 75%to 80% on the west side. EK: Regarding the High Street Mills residential units, they are coming in with a proposal of an additional 51 residential units (new construction). EK: This is what I would focus on as a major positive. AM and EK: Both spoke of the Forgetta Farm project, on Route 125, this will start around the spring. It is 193 residential units that also includes 43,000 square feet of commercial. AM: Also stated that a division of Coleman that will be moving into the old Solo Company site (off of route 125). The Finance Committee made comments and also asked a variety of questions to EK and AM regarding economic development. AM: Commented that the State is helpful in letting potential Businesses know the location and availability of commercial properties. AM: We come into this game (regarding attracting business to our town), knowing our shortcomings and strengths. AM: Commented that North Andover is 87%residential and 13% commercial, and also stated that he does not believe that is going to change much. AM: It is important to mention that we maintain good relations with the already existing business in town,because we want them to stay. AM: Spoke of the stretch of Route 114 and behind Route 114 and the various types of commercial businesses. TT: What can you tell us about Osgood Landing? AM: That is a complicated question. He spoke of the marijuana proposed project and also Amazon. This spot on Osgood Street will benefit the community if it is occupied. This is 169 acres of unused space. AM: The town created a very flexible, liberal and appealing mixed use for the Osgood Landing property. AM: Speaking to the Committee, the goal here is to answer and give you everything we have, you may not be happy with what you hear, we may disagree,but in the end of the day at least we are all having an honest conversation. AM: Commented that the DPW's new renovations will be complete soon and the Kittredge project will be complete next(sometime in the spring). Continued to speak of future projects for the town which will be about 7 figures. 3 December 5,2017 AM: Stated that EK and his staff have done a great job, and also in making the existing businesses in Town feel good about staying here. The Finance Committee thanked AM and EK. Discussion reizardint!the Fixed Revenue and Cost Committee (Tim and Liz) Discussion starts on or about 8:37 pm/0:01:41 on video time TT: I want to put a nail on this Fixed Revenue and Cost Committee that Liz and I have been going to. A lot of conservatism goes into this, this is the second time for me on this Committee so this is no surprise to me. Appointment of FinCom member to OPEB Committee Discussion starts on or about 8:39 pm/0:01:43 on video time TT: Asked if anyone was interested in joining the OPEB Committee. TT: The Committee would like to have 2 members from the Finance Committee. Charles Trafton is on this Committee already. We need another member. I have no idea when the meetings will be. EM: Stated that he would like to volunteer, but he travels and was concerned he would not be able to make all the meetings. JG: Spoke up and stated that she would like to volunteer, but expressed concerns regarding her schedule, with other upcoming meetings that she needs to attend. JG: Stated that she may be able to make the meetings that EM cannot make. TT: He will reach out to Chris Nobile and lock down some meeting dates for the OPEB Committee Meetings. I will get back to you. Discussion of Calendar and process Discussion starts on or about 8:45 pm/0:01:47 on video time JG: Passed out the Finance Committee schedule to the Committee members and spoke of the upcoming Finance Committee meetings, as well as other meetings in Town. Approval of Minutes November 14, 2017 Discussion starts on or about 8:47 pm/0:01:50 on video time CT: Made a motion to approve Minutes as written JG: Second the motion All in favor New Business Discussion starts on or about 8:49 pm/0:01:52 on video CT: Stated that Dan Leary reached out to him personally, so he will be meeting with him one on one, to find out some information and get some financial questions answered. I will report back what information I find out at the next meeting. 4 December 5,2017 Public Comment Discussion starts on or about 8:49 pm/0:01:52 on video time Stan Limpert, 43 Stonecleave Road Limpert: spoke of Revenue and Fixed Cost and commented that it is so rational these days, also he stated that he always learns so much from Andrew Maylor. Ad*ournment 8:54 PM SW: made a motion to adjourn JG: Second the motion All in favor to adjourn Document Table Agenda December 5th, 2017 Minutes for November 14th, 2017 Financial Forecast Fiscal years 2019-2023 Finance Committee Meeting Calendar Schedule 2017-2018 5 December 5,2017