Loading...
HomeMy WebLinkAbout2022-01-11-CEC-min RIECEIVED Minutes of the 2022 15IIFolllr 4 111:rin Lexington Capital Expenditures Committee (CEC) Meeting xx January 11, 2022 APRIL 14" L.ILMNVn;A II ON MA .G AINGI, Location and Time: Remote Meeting; 8:00 A.M. CEC Members Present (remote participation): Charles Lamb, Chair; David Kanter, Vice-Chair & Clerk; Sandy Beebee; and Frank Smith CEC Members Absent: Rod Cole Others Present (remote participation): Other Lexington Committees: Glenn Parker, Chair, Appropriation Committee, liaison to CEC; Staff: Finance Department. Sara Arnold, Recording Secretary Documents Presented: • Notice of Public Meeting/Agenda CEC Meeting, January 11, 2022 • FY2023 Town Manager's Preliminary Budget & Financing Plan (White Book) • Email from Mr. Kanter to Mr. Lamb, January 10, 2022, Subject: White Book • Email from James Malloy, Town Manager, to Carolyn Kosnoff, Assistant Town Manager for Finance; and Jennifer Hewitt, Lexington Budget Officer, Subject: Oil vs. Electric Hot Water Heater Call to Order Mr. Lamb called this Remote (Virtual) Meeting, which had been posted as such, to order at 8:00 A.M. As the Committee members present had been previously advised of the special conditions of this meeting, he passed on repeating them (i.e., the authority to not require a physical presence of a quorum and other selected terms under the Open Meeting Law in legislation signed on June 16th of this year by Massachusetts Governor Charles D. Baker). Mr. Lamb advised that materials provided electronically to the Committee or presented at the meeting, would be available upon request and are those listed in the Minutes as Documents Presented. Any votes during this meeting would be taken by a roll call. Further, this meeting would be recorded to assist in preparing Minutes, and the recording would be deleted once the Minutes are approved. Mr. Lamb took a roll-call attendance, determining that four members were present. Committee Comments on the "White Book" for the Fiscal Year (FY) 2023 Budget Summit III Mr. Kanter's January 10, 2022 email to Mr. Lamb was used to discuss the potential points to be made by Mr. Lamb during his presentation of CEC comments on the White Book at the January 13, 2022, Budget Summit III. Mr. Kanter added during the discussion that the Summit presentation provides another opportunity to demonstrate this Committee's meaningful relevance in the budget process. During the discussion, Mr. Smith reported on his recent conversation with John Livsey, Town Engineer, about the current challenges associated with pursuing capital projects—an example being the pump-station replacement for which the recently received bid price was almost double the fall CIP estimate. According to Mr. Livsey, in addition to supply-chain issues, price increases may also be impacted by an influx of Federal funding, causing a surge in competing projects, and creating an increased demand on materials and contractors' labor Page 1 of 3 Minutes of the Lexington Capital Expenditures Committee (CEC) Meeting January 11, 2022 resources. Contractors are reporting that their suppliers' quotes are only good for two weeks. Mr. Smith suggested that dramatic price increases should be anticipated and expressed particular concern about the new Police Station Project. The situation appears to be more dire than reported just a few weeks ago. Both Mr. Kanter and Mr. Smith emphasized that the achievable project scope, as well as the bid price, are reasonably expected to be a major issue for many, if not each, Capital project going forward. During the discussion, it was agreed that the tone of the presentation to the Budget Summit should be one of appreciation for the great work done in producing the White Book and while our points should be clearly presented, they are not to be combative. Key points identified, but not all that were discussed, for the presentation included the following: • The current market issues are expected to be exceptionally challenging, thereby creating a precarious planning environment. This is expected to affect the execution of the Town's Five-Year Capital Plan, which is the foundation for the CEC Five-Year Capital Plan, putting the validity of both at risk. Furthermore, there is also the Department of Public Facility's ongoing efforts to integrate the reasonably applicable data from the contracted 20-year plan to update their planning. Additionally, across the range of Capital projects, achieving what scope is included in the FY2023 budget is likely to be at risk. • It is not only expected that there will be financial implications associated with the current challenges, but the scope of work and timing for projects are likely to be impacted as well. It is reasonable to include concern about the remaining funding of the new Police Station and the Lexington High School projects. • This Committee supports the on-going reduction in the use of Free Cash to support the Operating Budget and the resulting availability of more Free Cash for Capital needs. • This Committee supports the Select Board's priorities for Capital funding. • This Committee supports the establishment of a Stormwater Enterprise Fund because the fees would provide relief for the funding required by the Department of Public Works to address the consequences of that water runoff. • This Committee's very significant comments on the FY2023 Capital Improvement Projects & Programs (CIPs)—among those highlighted in Mr. Kanter's email—should be included in the presentation to the Summit. Mr. Lamb shared an email from Mr. Malloy that identified a substantial cost differential between replacing the oil-fired hot-water heater at the Town pool with another such heater or switching to electric. It was noted that some of the identified costs for the electric hot water heater would be for permanent infrastructure changes and so should not be identified as part of the ten-year cost for the electric option. Additionally, there were questions about the operating cost estimates for an electric hot water heater. Mr. Lamb agreed to pursue clarification. He anticipates minimally referencing the need for additional information at the Summit. He may say more, depending on this research. A Motion was made and seconded to support the presentation at the Summit, as discussed and however Mr. Lamb chooses to form it, including the development of any written material by Mr. Lamb. Roll-Call Vote: 4-0. Page 2 of 3 Minutes of the Lexington Capital Expenditures Committee (CEC) Meeting January 11, 2022 Adjourn A Motion was made and seconded at 9:11 A.M. to adjourn. Roll-Call Vote:4-0 This Minutes was approved by the CEC at its meeting on February 10, 2022 Page 3 of 3