2010-10-06-AC-min - Laserfiche WebLink

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October 6, 2010 Summit I —October 6, 2010 A joint meeting of the Board of Selectmen and School Committee will be planned soon to discuss forming a capital planning task force. Mr. Goddard asked the Selectmento consider making the Task Force a town -wide health hazard task force because of the other two Town buildings with PCBs that EPA has been notified about. Upon motion duly made and seconded, the School Committee voted 4 -1 (Coppe opposed) to form a Task Force specific to Estabrook School post mitigation as well as to identifying sources to cover the cost of mitigation. Upon motion duly made and seconded, the Board of Selectmen voted 3 -1-1 (Kelley opposed and Burnell abstained) to form a Task Force specific to Estabrook School post mitigation as well as to identifying sources to cover the cost of mitigation. Overview of Lexington's Financial Condition Mr. Valente presented a summary evaluation of the town's financial condition: 1) evaluate fiscal health through a series of financial indicators and comparative benchmarks; 2) 3 -year revenue and expenditure projection; and 3) key policy issues that the Selectmen, School Committee and finance committees need to consider when discussing the budget for FY2012. Lexington's financial condition is generally sound: it has good revenue growth, stable labor costs as a percentage of total operating costs, adequate pension funding, a good balance of revenues related to economic growth, low debt service and adequate reserves; is satisfactory in the areas of expenditure growth; and is unsatisfactory in the areas of state aid and employee liabilities, in particular employee benefit costs and unreliable state aid. Revenue growth has, for the most part, been positive. State aid dependence may be difficult to manage where there is a reduction in funding, but the contingency plan in place helps create reserves capable of offsetting cyclical downturns in state aid and local receipts. Uncollected property taxes have increased and may indicate an inability by property owners to pay due to economic conditions; which may result in less cash on hand for the Town to invest. Personnel cost indicators are favorable to marginal; increasing salaries and wages may point to future pension and health insurance costs and if salaries and wages as a percent of operating expenditures are increasing it may be an indicator of deferred maintenance of the Town's infrastructure. Employee benefits indicator is unfavorable and represents a significant and increasing share of the Town's operating costs. Debt Service indicator is favorable; over the last ten years Lexington has invested extensively in new capital projects. Reserves and fund balance indicator is favorable because of several types of reserves. -3-