HomeMy WebLinkAboutAd Hoc Budget Committee Minutes October, 29, 2008_201402060848055036
Town of Nantucket
Ad Hoc Budget Committee Meeting
Minutes – Ad Hoc Budget Committee Meeting October 29th, 2008
Approved December 3, 2008
Present: Ms. Libby Gibson, Ms. Jenny Garneau, Ms. Susan Genthner, Mr. James Kelly,
Mr. Michael Kopko, Ms. Irene Larivee, and Mr. Matthew Mulcahy.
Absent: Ms. Patricia Roggeveen.
Also present: Mr. Rick Atherton, Mr. Brian Chadwick, Mr. Glenn Field, Ms. Robin Harvey,
Ms. Jane Miller, Mr. Malachy Rice, 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. Kelly moved to approve the minutes from the meeting of October 15th,
2008; seconded by Ms. Genthner. The minutes were approved by unanimous consent.
3. Review of the Mission and Expectations of the Ad Hoc Budget Committee:
Ms. Genthner said that after the conversations of the last meeting she tried to
think of ways to address the issue of people feeling surprised at the outcome of the
proposed teacher’s contract. She asserted her belief that meetings of the Ad Hoc
Budget committee should center on productive discussions and the sharing of
information. Ms. Genthner added that the it is important to periodically look at the
mission of work groups, and in the process gain a better understanding of individual
roles and the decision making process. Mr. Kopko agreed stating that he also felt it is a
good idea to periodically clarify the mission of the Ad Hoc Budget Committee or any
similar work group. On review of the Committee charter, Mr. Kopko noted that the
chair of the Capital Program Committee was designated as a representative to the
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October 29th, 2008 Page 2 of 5
Committee. Some discussion followed in regard to amending the charter to reflect
current membership standards.
4. Ideas for Methods of Public Education on the FY 2010 Budget:
Reflecting on the lack of public interest to two budget information meetings
pertaining to Fiscal Year 2010, Ms. Gibson asked for input from the Committee on how
to get more people involved in the process. Ms. Genthner said that she believed the
best results come from “going on the road.” She suggested that the Town attend
meetings of Rotary, School Councils and the Massachusetts Teacher’s Association and
make short presentations on the FY 2010 budget. Ms. Gibson added that she was still
looking into the possibility of televising budget presentations. Mr. Kopko commented
that he felt it is important to communicate FY 2010 budgeting issues early in order to
avoid being accused of “pushing” public opinion later in the budget process.
5. Review of School Department Cost Analysis of the Teacher’s Contract:
Ms. Genthner directed Committee members to information on the cost analysis
associated with the new teacher’s contract. She stated that she felt the information
would be helpful in explaining the School’s position, in addition to numbers and
percentages. Ms Genthner asked Glenn Field, Assistant to the Superintendent for
Business, to elaborate on the information. Mr. Field asked the Committee members to
begin with a document containing a scale plot. He explained that the matrix uses “point
specific individual employee identification,” and that this allows the matrix to account
for the wage, step and column of each employee. Using this method, Mr. Field said that
he was able to artificially age the workforce in order to make projections for FY 2010
and FY 2011, which after additional incentives of $14,000 resulted in a base cost
increase of five percent. He added that the process was simply taking the rate,
multiplying it by the volume, and then rolling it up into a summary page.
Mr. Mulcahy asked if it was possible to factor in positive monetary aspects of
attrition into the matrix, i.e. a senior teacher retiring at the top of the pay grade and
being replaced by an entry level teacher. Mr. Field responded that it is possible to make
those types of predictions, but he does not recommend the practice due to certain
levels of unpredictability. He stated that he makes these types of adjustments when he
has a signed letter of intent from the teacher with a retirement date. Mr. Field said that
there is a one time boost to School finances when a senior teacher retires and is
replaced by an entry level teacher, but that the entry level teacher’s salary will increase
at seven to ten percent each year (due to the fact that entry level teacher’s receive step
increases) while the senior teacher’s salary would be frozen at the maximum step. He
noted that the School is “blessed” to have fifty‐five to sixty percent of its teachers at the
maximum step.
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October 29th, 2008 Page 3 of 5
Mr. Kelly asked if there was an all inclusive percentage that represented the
amount of increase in teacher compensation. Mr. Field responded that the amount is
5.67%, when all incentives are elected and active. Mr. Kelly asked Mr. Field if he knew
the dollar amount difference between 5% and 5.67%, to which Mr. Field responded that
he believed the amount was $180,000 to $200,000. He noted that there is one other
variable not factored into his calculations, approximately $1 million in stipends and
differentials that are not included in the employment contract. Mr. Field explained that
these monies were budgeted for tutor help and mentoring, and classified the funding as
an unassigned wage that would increase in line with any bargaining agreement. Mr.
Kopko asked if these funds were considered to be compensation. Mr. Field answered
that these monies are classified as wage with the bulk of it going to Massachusetts
Teacher’s Association members. He added that it is generally accepted practice to
exclude these types of compensation when calculating base wages.
In regard to longevity, Mr. Kopko asked if these types of compensation were
included in the matrix. Mr. Field stated that since these factors are known, and the
School knows to whom the compensation is assigned, it can be included in the matrix.
Mr. Kopko noted that for Fiscal Years 2009, 2010, and 2011 the number stayed the
same. Mr. Field replied that this was due to his “best guess that we will get as much as
we lose.” He commented that he would like to neutralize the “previous vagary” by
adding that he is already tracking eight employees who will change columns in FY 2010
due to improved credentials.
In regard to professional incentives, Ms. Genthner said that she would like to
address a bit of its history at the School. She stated that under Dr. Pellicone the School
had worked hard to provide rewards for great service, and that the philosophy of the
current administration is that these types of awards are important. Ms. Garneau noted
that the School Committee worked hard to bring performance incentives into the
teacher’s contract, and that the School will be the first in the State to have such a
contract. She added that the contract not only rewards teachers for doing a good job,
but also measures and evaluates performance and encourages peer to peer knowledge
sharing. Dr. Pellicone reminded the Committee that the performance incentive is not a
part of the base salary and that it “sunsets” at the end of the contract. Ms. Miller
commented that one portion of the incentive program rewards teachers for getting
their National Teacher Certification, a highly regarded certification for educators.
In regard to retirement, Mr. Atherton said that he wished to clarify his
understanding that the School did not account for impending retirements until there
was written notification of the retirement. Mr. Field responded that when he is plotting
salaries for a three year forecast he does not include impending retirements, but in
budgeting for current years he is able to include retirement information, since it is
possible to have written notification at that time. Ms. Larivee commented that the
Town uses a similar method for its financial projections.
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October 29th, 2008 Page 4 of 5
Ms. Genthner complimented Mr. Field on presenting the contract data in such a
precise manner and then asked him if he could elaborate on new accounting methods
intended to help the School and the Finance Department reconcile finances. Mr. Field
said that he was offering himself as the “Rosetta Stone” for translating between
Department of Revenue (DOR) and Department of Education (DOE) requirements for
financial reporting. He stated that he had been assured by the Finance Department that
a dual, simultaneous chart of accounts will be created that will allow a level of electronic
reporting to DOE that does not currently exist, and the system will not alter the Town’s
DOR format.
6. New Business
Stating that he was making an effort to be sensitive to the Ad Hoc Budget
Committee charter, Mr. Kelly asked if there were expectations that shortfalls in the FY
2009 budget could impact the FY 2010 budget. Ms. Larivee responded that from the
Town’s perspective there would be more information at the meeting scheduled for
November 18th, 2008. She said that at that time it would be possible to review financial
information through October 31st and that changes continue to be factored into the FY
2010 budget. Ms. Garneau asked if an “open budget” for FY 2009 would be presented
at the Special Town Meeting. Ms. Gibson answered that an “open budget” would not
be presented. She stated that the Special Town Meeting was being held due to issues
with FY 2009 Solid Waste Enterprise Fund revenues projections, and that the FY2009
General Fund Budget article was a “placeholder” in case revenues fell below projections.
Mr. Kelly explained that he phrased his question with respect to the charter in order to
stay on track with Committee’s mandate. Some discussion of the reasons for the Special
Town Meeting followed.
Continuing on the theme of budget shortfalls, Mr. Field said that he had
identified three areas where the School was experiencing difficulty: utilities, special
educational residential mandated tuitions, and costs associated with replacement of the
fuel oil tank. Ms. Genthner added that the School is working with administration to
close the gap between budgets for these items and actual expenditures. She
commented that the School is trying to use a collaborative approach to stay on the
“front side” of decision‐making, but the expected budget shortfall would be in the range
of $600,000 to $800,000 for the current fiscal year. Mr. Atherton said that it was his
assumption that the School and the Town would have to look within current budgets
and find ways to make up the shortfalls. Ms. Larivee responded that the Town is
required to deliver a balanced budget.
Ms. Gibson said that the Town had no plans to pursue override related options.
Ms. Genthner stated that she would report back to the School Committee that they
should not expect to have an operating override. Mr. Atherton commented that he said
whatever option is decided upon, it would be better to make the decision sooner than
later. He noted that there is a projected budget deficit of $2.2 million, and that the
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October 29th, 2008 Page 5 of 5
percentage of the deficit to be applied to the School and the Town has not been
determined. Ms. Gibson said that Town Administration would present a budget
projection to the Board of Selectmen that will provide a general overview of
recommended cuts in spending. She echoed Mr. Atherton’s comments about deciding
the override issue early and added that some towns add the override to the Town
Election in order to already have it on the ballot to be approved by voters should it gain
approval at Annual Town Meeting.
On the topic of overrides, Ms. Genthner stated that the School had made no
decisions regarding whether or not they would present such an option to the voters.
She said that she has worked hard to communicate to School departments that it will be
necessary to “be lean” in regard to future financial operations. She reiterated her desire
to work with the Ad Hoc Budget Committee to improve communication.
Mr. Kopko asked if the Committee could be presented with a quick review of the
Capital Plan at the next meeting. Mr. Mulcahy, Finance Committee representative to
the Capital Plan Committee, answered that he could give an update, but he did not
believe a completed plan would be ready at that time.
7. Old Business:
None.
8. Date of Next Meeting:
The next meeting was scheduled for Tuesday, November 18th, 2008, immediately
following the public information meeting on the FY 2010 budget.
9. Adjournment:
Mr. Kopko asked for a motion to adjourn that was “so moved” by Mr. Mulcahy.
The meeting was adjourned at 10:10 AM.
Prepared by Craig Abernathy