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APPROPRIATION COMMITTEE 2 " REPORT, April 21, 2007, TO 2007 ATM
<br />This is not a requirement to begin funding the liability, but simply to determine the amount of the liability
<br />and record it as part of the annual audit. The Town engaged an actuary to measure the liability in order to
<br />be in compliance with GASB -45. The actuarial analysis has been completed and the results of the report,
<br />dated March 9, 2007, were presented to the Board of Selectmen at its meeting, April 18, 2007.
<br />As introduced last year, this Article is a placeholder for the eventual funding of this liability and no funds
<br />are requested at this time. It is anticipated that at the next Annual Town Meeting, the Town Manager will
<br />recommend an appropriation to begin funding future retiree health -care liabilities. The expected source
<br />will be funds the Town is now receiving from the Federal government to partially offset the prescription -
<br />drug benefit we provide to retirees in place of the Medicare Part D prescription benefit. During the current
<br />fiscal year (FY2007), the Town has received approximately $300K in Medicare Part D rebate, but these
<br />monies cannot be appropriated until they become part of the next certified Free Cash balance. It is
<br />expected that this will be an annual payment to the Town as long as we continue to offer a prescription
<br />drug benefit to retirees.
<br />This Committee unanimously (7 -0) supports Indefinite Postponement.
<br />Article 38: Rescind
<br />Funds Requested
<br />Funding
<br />Committee
<br />Prior Borrowing
<br />Source
<br />Recommendation
<br />Authorizations
<br />($3,000,000)
<br />Debt
<br />No Position (7 -1)
<br />Indefinitely
<br />Postpone
<br />The 1999 Annual Town Meeting approved (for FY2000) an appropriation of $3,000,000 "for acquiring
<br />land for open space and conservation purposes, including outdoor recreation, as provided by G.L.c.40,
<br />§8C, as amended ". The vote further provided "that to meet this appropriation the Treasurer with the
<br />approval of the Board of Selectmen is authorized to borrow $3,000,000 under G.L.c.44, §7(3); provided,
<br />however, that this appropriation and the expenditure of funds pursuant thereto shall be limited to the
<br />acquisition of such land and/or interest in land as may be approved by a two - thirds vote of an annual or
<br />special town meeting" [1999 Annual Town Meeting, Article 34 (Land Acquisition Bond), Motion dated
<br />March 22, 1999]
<br />While there were no specific acquisitions identified as ready for funding at that time, it is our
<br />understanding that the action was taken to demonstrate formally the Town's continuing commitment to
<br />open space, conservation, and outdoor recreation.
<br />Since then, first Town Meeting (by its approval at the 2005 Annual Town Meeting) and then the
<br />Lexington citizens (by voting to pass a referendum question in March 2006) have formally renewed that
<br />commitment with the adoption of the Community Preservation Act (CPA) —which was done at the
<br />maximum, 3 %, surcharge on their real- estate taxes. Those local funds, along with the matching (to some
<br />degree, but starting at 100 %) State funds, are for Affordable Housing, Open Space, Historic Preservation,
<br />Recreation, and for operating expenses of the Community Preservation Committee (CPC).
<br />With the implementation of the CPA in Lexington, there is now a more- robust, in -use program to achieve
<br />the same purpose(s) as the never -used bonding authority from 1999. While outstanding bonding
<br />authority —which remains part of Lexington's authorized borrowing authority and, thus, diminishes our
<br />total borrowing capacity —could have some very -minor adverse ef'f'ect as bond - rating agencies judge
<br />Lexington, that is not our reasoning for believing it is prudent to rescind this unused authority. Even
<br />without an ef'f'ect on the Town's bond rating and even having been told there is no legal impediment to
<br />having two concurrent, alternate, funding procedures, we still would urge rescission as we cannot support
<br />having two, parallel, funding paths for the purchase of open space. We see a purchase that would fall
<br />under the 1999 authority as falling within the scope of the CPA, and believe any such CPA - eligible
<br />project should be presented to the CPC so it can compete along with other CPA - eligible projects. Further,
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