TOWN OF GRANBY
BOARD OF FINANCE SPECIAL MEETING MINUTES
JANUARY 12, 2010
PRESENT: Michael Guarco, Chairman; Gordon Bischoff, Francis Brady, Robert Clark, Frederick Moffa, OD, and Al Wilke
Also present: John Adams, First Selectman; William F. Smith, Jr., Town Manager; Barbarajean Scibelli, Administration Finance Officer; Alan Addley, Superintendent of Schools; J. Cal Heminway, BOE Chairman; Harry Traver, BOE Business Manager; Mark Neumann, Selectman, and Roger Hernsdorf, Town Treasurer
hairman Guarco stated there was a quorum and called the meeting to order at 7:30 p.m.
MINUTES
The Board reviewed the minutes for the meeting of November 23, 2009 before taking action.
On a MOTION by Gordon Bischoff, seconded by Al Wilke, to approve minutes of November 23, 2009, the Board voted unanimously (6-0-0) to approve the minutes.
PRESENTATION OF JUNE 30, 009 AUDIT REPORT
Chairman Guarco welcomed Mr. Kask. Mr. Kask introduced himself and stated their firm, Blum, Shapiro and Company, issued and delivered the Comprehensive Annual Financial Report (CAFR), the Federal Single Audit Report, State Single Audit Report, and Management Letter in accordance with auditing standards. He indicated that the Town of Granby received a clean opinion for this year. The disclosures in the financial statements are neutral, consistent and clear.
e commented about his work with the state legislature concerning the state single audit report threshold of $100,000 for major programs increasing to $300,000 next year.
Mr. Kask discussed what an audit included, some of which are consideration of internal control over financial reporting for assessment purposes, test basis, and evidence supporting the amounts and disclosures in the financial statements.
He reported from the Comprehensive Annual Financial Report. Page one, Independent Audit’s report describes the responsibilities of the accounting firm and the third paragraph gives the clean opinion for the town. Pages 3-15 are the Management’s Discussion and Analysis, which describes the town’s financial activities.
He presented highlights to Exhibits I, II, III, IV, V, VI, and IX -- pages 16, 17, 18-19, 20-21, 22, 23, and 26. He indicated Exhibit I shows the net assets of governmental activities as $57 million. Exhibit II shows the net cost of providing programs and functions as approximately $44 million. Exhibit III shows budgetary basis of accounting for liabilities and fund balances in governmental funds as $20 million. Exhibit IV shows the statement of revenues, expenditures and changes in fund balances for governmental funds as approximately $11 million at year-end. Exhibit V shows $1.8 million for total net assets. Exhibit VI shows the health benefits at end of year as approximately $1.8. Exhibit IX shows the pension trust fund at year-end as approximately $1.5 million net decrease. The net assets held in trust for pension benefits at end of year was approximately $9.1 million.
He commented about the other post-employment benefits (OPEB) being the first year reported on. Town Manager Smith indicated the town plans to address the commitment by using internal service funds to meet this year’s obligation. There are risks involved in satisfying the requirement. If the internal service fund becomes insufficient, the general fund use will become necessary to use. Every two years a review is completed to analyze the fund’s obligation to meet its requirements. Mr. Kask indicated that municipalities across the state are similar to Granby’s situation in financing this fund. The town and board currently pay as you go for OPEB benefits. However, there is a 30-year plan in place to address the funding issue.
Mr. Kask thanked the town and school finance employees for all their efforts in assisting in the audit process.
Chairman Guarco thanked Joseph Kask, the administration, and staff for a job well done.
STATEMENTS OF ACCOUNTS
The November and December Statement of Accounts from the Board of Education were distributed and Harry Traver, BOE Business Manager reported on the December Statement of Accounts. The favorable amount forecast is $89,294. However, $40,000 is being used to offset administrative fees for administrative illnesses.
The November and December Budget Operations reports were distributed. Barbarajean Scibelli reviewed the December Budget Operations Report. Tax collections are coming in at 65%. Auto supplement will fall short. Other revenue accounts should make up for this shortfall. The MFG Machine Equipment is a little short and other funds will cover. The Elderly Tax Relief and Misc – State accounts show an excess. Payments received in the Misc-State account were from the senior van grant and silver street bridge grant. Local revenues are coming in as expected and the Planning and Zoning account shows a small amount in excess because of two 9-lot subdivisions being created Expenditures are on target. Mrs. Scibelli indicated the snow removal overtime account should
meet the budget at this time unless storm activity increases. Mrs. Scibelli answered questions that the short-term investment should meet expectations.
Town Manager Smith reported there were seven foreclosures in FY 2008 and 11 foreclosures in FY 2009.
An update on the finance software program shows it is going well. The payroll program section started January 1st. Creating reports is one of the next steps that will take some time because of its complexity.
DISCUSSION OF 2010-11 PLUS-ONE BUDGET AND SETTING 2010-11 BUDGET GUIDELINES
Town Manager Smith reported that the town’s plus-one budget primarily dealt with compensation. He stated that the town cannot maintain service levels at a zero increase for FY 2010-11.
First Selectman Adams concurred with Town Manager Smith and commented some of the areas that may be affected with a zero increase budget are town hall may not be open during lunch hour, library hours cutback, and police services and public works personnel.
Superintendent of Schools Alan Addley presented the school’s plus-one budget indicating a 1.65% increase in the operating budget to meet service levels of the school.
A discussion ensued about sharing services, looking for savings in major public utilities, and the economy in general.
Both Town Manager and Superintendent of Schools indicated the school and town are working together in all capacities that can be done, constantly looking for savings.
Chairman Guarco led the discussion with his Board concerning the budget process, public input, and the economy in general. Some highlight comments were:
· The primary driver behind a mill rate increase this year is the need to cover debt service through the mill rate.
· The Board’s drive to drop off use of General Fund surplus affects the operating budget when at zero increase.
· The Debt Service peaked last year. Granby must gradually substitute Property Tax Rate/Dollars for Use of Reserves.
· Acknowledged a lot has been accomplished over the years in town. The new philosophy is people are doing more with less. The town needs to show how we do more with less.
· The economy viewpoint is strong. A flat operating budget approach is preferred. The Board of Finance will find the money to keep the mill rate increase (1.71%) down.
· Some risk factors in the budget are intergovernmental revenues decreasing, the ECS being very volatile.
On a MOTION by Al Wilke, seconded by Francis Brady, the Board voted unanimously (6-0-0) to consider suggesting to both boards that they plan on a flat budget for the next fiscal year and that we review their plans after they have been developed and submitted for future budget hearings and then make a final determination as to what the consequences of that might be.
BOARD OF FINANCE MEMBER DESIGNATION FOR BUDGET WORKSHOPS
The Board of Finance members held discussions assigning members to attend the budget workshops for:
Board of Education
· Fred Moffa, OD and Francis Brady
Board of Selectmen
· Michael Guarco and Gordon Bischoff
CONFIRM DATE OF NEXT MEETING
The next regular meeting of January 25th will be cancelled and a special meeting is scheduled for February 9, 2010 at 7:30 p.m.
A Board of Selectmen Three Board Meeting is scheduled for January 19, 2010 at 7:30 p.m. in the Senior Center Community Room. A discussion was held about scheduling public sessions for Q&A on the 2010-11 budget that Chairman Guarco will take the lead on. These sessions will be scheduled for a morning, afternoon, and evening.
ADJOURNMENT
On a MOTION by Mr. Brady, seconded by Mr. Wilke, the Board voted unanimously (6-0-0) to adjourn the meeting at 9:25 p.m.
Respectfully submitted,
Patricia I. Chieski
Recording Secretary
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