HomeMy WebLinkAboutFCMeetingMinutes_01.03.02 FINANCE COMMITTEE MINUTES
JANUARY 3,2002
ATTENDANCE: Members present: Michael Garron,Chairman;Bernice Fink,Vice Chairman,Keith
Mitchell;Paula Porten;Paul Stewart; Jack Watkins.
Not Present: Paul Theberge
Also present: Mark Rees,Town Manager;Charles Benevento,Director of Finance and Administration
CALL TO ORDER: Michael Garron called the meeting to order at 7:25 p.m.
APPROVAL OF MINUTES:
Bernice Fink made a MOTION,seconded by Jack Watkins to approve the November 15,2001 minutes.
Vote approved 6—0.
Keith Mitchell made a MOTION,seconded by Paula Porten,to approve the November 29,2001 minutes.
Vote approved 5—0— 1:(Bernice Fink abstained.)
Jack Watkins made a MOTION,seconded by Keith Mitchell to approve the December 3,2001 minutes as
amended. Vote approved 5—0— 1.(Bernice Fink abstained.)
NEW BUSINESS:
New High School Financing Options
The Finance Director presented four options(residential):
1) Option C
• Standard borrowing method
• Temporary borrowing until the construction is done,then permanently bonded
• $9.1M more than Option A in additional interest
• Tax rate kept low initially,later increases,then drops
2) Option A—$15.OM Bond in FY03_
• Bond$15.OM(estimate)for 10 years;bond retraining$43.OM when state reimbursement begins
• Temporary borrowing in two years then permanently fund at an accelerated schedule.
• Payment peaks in FY04 then begins to decline so that payments are lower by the time the next
school is to be funded.
• Lowest in interest
3) Qption B -
• Same as Option A,but Level funded
• Decreased cost to taxpayers in first years of project
• $6.6M more than Option A in additional interest
4) Option D
• Standard borrowing method,but Level payments
• Decreased cost in first years of project
• $19.7M more than Option A in additional payments
The Town Manager said that he recommends Option A because it carries the least amount of interest,and it
allows the most flexibility to fund future capital projects. He said that the school prefers level funding.
Bernice Fink suggested a$20.OM Bond rather than a$15.OM Bond.
Bernice Fink made a MOTION,seconded by Paula Porten,to recommend to the Board of Selectmen that
they approve funding the Town's share of the new high school at an accelerated payment rate.
Vote approved 6—0.
Changes to Debt and C.I.P.Policies
The Finance Director informed the committee that there is a proposal to refine the current Debt and CIP
policies as follows:
First Group
• Net Direct Debt Service—definition added
• Net Revenue—definition added
• Net Debt Service Target—changed to lower the percentage cap of net operating revenues from 4-6%to
3-5%
Second Grouu
• CIF Budget Allocation—changed to raise the percentage of the total CIP related costs from 2-3%to 4-
6%of net revenue,and included net debt service to the tax related appropriations.
Keith Mitchell made a MOTION,seconded by Jack Watkins,to recommend that the Board of Selectmen
eliminate the two current policies as written and replace thein with the proposed changes including the two
additional definitions.
Vote approved 6—0.
OTHER
The Finance Director handed out the FY01 Annual Financial Reports.
Keith Mitchell requested that a letter be written to the School Superintendent asking if the$200,000 that
they received is being added to the base or is it a one-time award. Bernice Fink also requested that letters
be drafted to Representatives Jones and Torrisi and Congressman Tarr thanking them for being
instrumental in the Town receiving the additional funds. The Finance Committee Chairman instructed the
senior clerk to draft the letters.
ADJOURNMENT
Keith Mitchell made a MOTION,seconded by Jack Watkins,to adjourn the Finance Committee meeting at
8:40 p.m. Vote approved 6-0.