HomeMy WebLinkAboutAd Hoc Budget Committee Minutes October 15, 2008_201402060848053004
Town of Nantucket
Ad Hoc Budget Committee Meeting
Minutes – Ad Hoc Budget Committee Meeting October 15th, 2008
Present: Ms. Libby Gibson, Ms. Jenny Garneau, Ms. Susan Genthner, Mr. James Kelly,
Mr. Michael Kopko, Ms. Irene Larivee, Mr. Matthew Mulcahy, and Ms. Patricia
Roggeveen.
Absent: Robert Pellicone Ed. D.
Also present: Mr. Rick Atherton, Ms. Margaret Bergman, Ms. Robin Harvey, Mr. John
Tiffany, Mr. Whiting Willauer, and Mr. Craig Abernathy
1. Call to Order:
Mr. Kopko called the meeting to order at 9:00 AM.
2. Approval of Minutes:
Mr. Kopko asked for unanimous consent to approve the minutes from the
meeting of September 4th, 2008. Hearing no objections the minutes were approved by
unanimous consent.
3. FY 2010 Budget Updates:
At the Board of Selectmen meeting of October 8th, 2008, Ms. Gibson stated that
Ms. Larivee presented an update on budget projections and the timeline for completing
the budget. She said that in the time between the initial projection and the Board
meeting economic conditions had changed. The first quarter State Local Aid
disbursement had been received, but Ms. Gibson said she would be watching future aid
disbursements carefully. She noted that local revenue for the first quarter was at about
the same level as the previous year, but again felt that it would be prudent to watch this
area carefully. Ms. Gibson said that she was expecting more information from the State
that could impact State contracts, such as impending sewer projects.
Minutes – Ad Hoc Budget Committee
October 15th, 2008 Page 2 of 6
Ms. Larivee said that first quarter FY 2009 revenue came in slightly above the
levels reported in first quarter FY 2008. She stated that she would not be making any
adjustments to FY 2010 revenue projections until more revenue data is available and
the Tax Recap is certified. Ms. Larivee said she expects to make further revisions in mid‐
December. In regard to local revenue, Ms. Larivee said that while the demand for
building permits had fallen, the loss in revenue had been compensated for by an
increase in revenue from Our Island Home. Mr. Mulcahy asked if the increase in
revenues at Our Island Home was due to increases in Medicare receipts. Ms. Larivee
said that the increase in revenue was due to an increase in fees.
Mr. Kopko stated that he and Mr. Atherton attended a Selectmen’s Association
meeting on the previous Friday. He reported that the general mood of the meeting was
that economic conditions look worse than ever going forward. Mr. Kelly asked if it was
possible to get a schedule of support from the State in order to plan for any risk of loss
and determine the scope of potential loss due to cuts in funding from the State. He
asked if the Town has implemented its hiring freeze, to which Ms. Gibson responded
that the freeze had been communicated verbally but not formally. Mr. Kelly asked if the
School was operating under similar constraints, to which Ms. Genthner answered that
Dr. Pellicone had instructed all departments that vacancies would be filled on a case by
case basis.
Mr. Kopko asked if there had been any progress on the FY 2010 School Budget.
Ms. Genthner answered that Dr. Pellicone was working with administrative teams to
complete a balanced budget based upon the assumptions of the Ad Hoc Budget
Committee. She noted that the FY 2009 Budget $600,000 would need to be cut due to
increases in operating costs, contaminated sand removal, and a deficit in School Lunch
funding. Ms. Genthner said that Dr. Pellicone would be providing more information
about where the cuts will take place. Mr. Kopko asked if the School was operating with
specific guidelines, and Ms. Genthner answered that they were working with directives
from the School Committee.
In regard to the Community School, Ms. Roggeveen asked that it not be the
target of budget cuts. She felt that it would not be appropriate for the School to cut
funding from the Community School because the Community School budget had been
approved as a separate line item by voters at Annual Town Meeting. Mr. Kopko asked
that School and Town officials sit down and talk about the model for the Community
School. Ms. Roggeveen said that she felt it was important to talk about any changes
now in order to be proactive. Mr. Kopko said that if the Town could make the school
district situation more rational by taking on some of the responsibility of the Community
School, then that is an option that should be considered. Ms. Roggeveen said that she
would like to add the topic as an agenda item for a meeting at which Dr. Pellicone would
be available for comment.
Minutes – Ad Hoc Budget Committee
October 15th, 2008 Page 3 of 6
In other budget updates, Ms. Larivee said that FY 2010 health insurance costs are
expected to be level, and that should free up about $324,000 to be allocated elsewhere.
She said that the recommendation of the Finance Department was to allocate the
monies for a one time spend. Mr. Mulcahy asked what types of items might be
identified for the funds. Ms. Larivee said that it could be put into the stabilization fund
or used for capital items.
4. Review of Budget Information Meeting Schedule and Content:
Ms. Gibson said that the Budget Information Meetings would be held at the High
School on Thursday, October 16th, at 6:00 PM; Tuesday, October 21st, at 8:30 AM; and
Tuesday, November 18th, at 8:30 AM. There had been plans to televise the meetings,
but Plum Television declined the offer to televise the event. Mr. Kopko said that he felt
if it were necessary to spend money to have the meetings televised it might be a good
idea. Ms. Gibson said the presentation for the first two meetings will focus on revenues,
and be presented in a PowerPoint format. Mr. Atherton asked that Ms. Gibson highlight
the increases in revenue at Our Island Home and exactly how much of the other
revenue shortfalls the increases were covering.
Looking forward in the budget timeline, Ms. Gibson said that departmental
budgets were due to Town Administration by Friday, October 17th, 2008. The next
meeting of the Ad Hoc Budget Committee was scheduled to immediately follow the
Budget Information Meeting scheduled for Tuesday, November 18th, at 8:30 AM, and on
the 19th an agenda item would provide for budget discussion at the Selectmen’s
meeting. Mr. Mulcahy asked if projections still forecast a $2.3 million shortfall. Ms.
Larivee said her projections forecast a $2.2 to $2.3 million shortfall, but she will
continue to look at revenues as they can cause the amount of the shortfall to change.
5. New Business:
Mr. Kopko proposed that the Ad Hoc Budget Committee explore options for the
establishment of a capital fund. He said the capital fund could work as a savings
account, and that the funds could be used to cover capital items that are not approved
by voters. Mr. Mulcahy asked about the logistics of setting up such a fund. Ms. Gibson
said that she and Mr. Rice have been examining some options for establishing such a
fund. She said that monies returned from the Health Insurance Trust or Free Cash could
be deposited in this type of account. Mr. Mulcahy asked if the establishment of a
capital fund would require a vote at Annual Town Meeting. Ms. Gibson answered that a
vote would be necessary to appropriate the funds and to establish the capital fund. Mr.
Kopko said that the fund could demonstrate the Town’s commitment to saving and
planning. Noting that he also had a “rainy day” fund, Mr. Kelly said that such a fund was
something that people could relate to on a personal level.
Minutes – Ad Hoc Budget Committee
October 15th, 2008 Page 4 of 6
In regard to playing fields, Mr. Kopko said that he felt it was important for the
School and the Town to establish a master plan. He said that it was a complex issue and
that it is difficult to rationalize the need to voters. Mr. Mulcahy stated that he felt more
input from citizens would be essential to a successful development process. Mr. Kopko
said that making this a priority would help overall budgeting for the Town and the
School. Ms. Genthner stated that she would put the item on the School Committee
agenda and ask the School Committee to give the master plan priority.
Mr. Kopko said that he wished to discuss the new teacher’s contract, noting that
it sounded like a “big, huge hot fudge sundae for everybody at this table to eat.” He
asked if the School could provide the details of the contract, specifically by providing the
data in a template that would facilitate an “apples to apples” comparison. Ms. Gibson
said that Ms. Larivee developed a cost analysis that she would be happy to share with
the School Committee, and noted that Glenn Field, Assistant to the Superintendent for
Business, has software that is configured for the purpose of “costing out contracts.”
Mr. Kopko said that the Town was working under specific guidelines. He
highlighted a recent letter published in the local media in which Bruce Miller explained
that a salary increase of five percent should cover everything, i.e. annual pay increases,
step increases, bonuses etc... Mr. Kopko asked if the teacher’s contract met the
guideline of a five percent increase that included all compensation. Ms. Genthner
answered that the contract did not meet that guideline when all compensation was
included. Mr. Kopko said that he felt not meeting the guideline would be a problem.
Mr. Kelly said that he thought that everyone at the table had talked about
communicating labor contract agreements in a document template that allowed for
increases to be easily represented. In noting that the Ad Hoc Budget Committee
discussed guidelines for labor negotiations over one year ago, he said that he was
“taken aback” that the guidelines were not followed. Mr. Kopko stated that his sense
was that the Town had been given assurances through the process that the guidelines
were being followed, and then at the end of the process found out the guidelines were
not followed. Mr. Kelly said that he said this development will “set up” the Town for
conflict in future labor negotiations. Mr. Kopko said the reason for the meetings of the
Ad Hoc Budget Committee was to help everyone stay “on the same page.” Mr. Kelly
noted that the Committee had been meeting on a regular basis and the matter of the
teacher’s contract negotiation had not been mentioned.
Ms. Genthner asked the Committee in what format was the new contract
viewed. Ms. Gibson answered that the only information the Ad Hoc Budget Committee
had viewed was the information that was published in local media. Ms. Roggeveen said
that the format was important in that it projected long term costs and allowed for the
comparison of “apples to apples.” She noted that this was key to the Town’s
administration of finances, and that good information is critical to maintaining the
public trust. Mr. Kopko said that salary increases were reported at four, four and three
Minutes – Ad Hoc Budget Committee
October 15th, 2008 Page 5 of 6
and a half percent over a three year period. He pointed out that these reports list only
increases to base pay, while the directive the Town has tried to implement would
include all increases in compensation.
Ms. Larivee said that it was important to consider the length of time that
teachers have been working with the School, since teachers with long periods of service
would have already reached the maximum step. She said that teachers at the maximum
step would not receive compensation in excess of the base salary increases. Ms.
Roggeveen asked if the total percentage increase in compensation was known, to which
Ms. Genthner replied that she did not have that information at hand. Mr. Kopko said
that he felt this was a very important number. Mr. Kelly voiced frustration, stating that
the purpose of the meetings of the Ad Hoc Budget Committee was to avoid these kinds
of lapses in communication. He said that he felt the meetings should facilitate the
sharing of information, but instead the Ad Hoc Budget Committee had been left “out of
the loop.” Mr. Kelly stated that the teacher’s contract agreement went against the basic
tenets of good dialog. In reference to the Airport labor negotiations in the prior year, he
said that the Finance Committee had a clear objective of not allowing the problems it
had with contract negotiations in the past to occur again, as they were unproductive.
Ms. Garneau pointed out that the teacher’s contract is not voted on separately,
but that it is a part of the overall School budget. Mr. Kelly said that the School
Committee approves the contract, but the purpose of the Ad Hoc Budget Committee is
to have discussion and dialog on contract negotiations. Ms. Garneau asked how could
the Committee discuss ongoing, confidential contract negotiations. Mr. Kelly answered
that there were limits and guidelines that could be discussed. Ms. Roggeveen added
that the guidelines were set by what the Town can afford. She said that the problem
when organizations go outside of the guidelines gets serious because the Town can’t
afford it. Mr. Kopko said that Dr. Pellicone clearly expressed a commitment to
delivering a contract that met established guidelines. He said that failure to meet the
guidelines had left him feeling “gob smacked.” Mr. Kelly said that it was important to
remember that the full details of the contract had not been disclosed.
Ms. Genthner said that the details of the contract were still under negotiation,
and that she was not at liberty to discuss them. She said that the Massachusetts
Teacher’s Association had been informed that they could not have everything they
wanted, i.e. salary increases, small classes, teaching assistants, and administrative
assistants. Mr. Kopko said that the difference was that the Town had clearly
communicated the guidelines for what it has to work with in labor negotiations. He said
that due to limited resources it was imperative to follow these guidelines. Mr. Kelly said
that the School can use different parameters since it has a separate budget, noting that
the teachers could have a ten percent increase if class sizes were doubled. However, he
said that not meeting the salary increase targets makes future negotiations a problem
for the Town, as everyone would want to have the same salary increase as the teachers.
Minutes – Ad Hoc Budget Committee
October 15th, 2008 Page 6 of 6
Mr. Kopko said that for many years the Town maintained unsustainable
increases in spending for payroll. In a coordinated effort, much of the Town’s leadership
worked to rein in salary increases, but Mr. Kopko said the School had made it more
difficult to achieve those goals. He asked that Dr. Pellicone and Mr. Field attend the
next meeting of the Ad Hoc Budget Committee, and also asked Ms. Gibson to make sure
the School was clear on the format for presenting the contract information. Ms. Gibson
said that she will give the format to the School. Mr. Kopko said that information in the
correct format would be key to discussions in the next meeting.
6. Old Business:
None:
7. Date of Next Meeting:
The next meeting was scheduled for Wednesday, October 29th, 2008, at 3:00 PM.
8. Adjournment:
Mr. Kopko asked for a motion to adjourn that was “so moved” by Mr. Kelly. The
meeting was adjourned at 9:46 AM.
Prepared by Craig Abernathy