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HomeMy WebLinkAbout2014-02-25-CEC-min •'pJ5 pAgb7 NIpBl„�� LL n Minutes of the gi Lexington Capital Expenditures Committee (CEC) Meeting February 25, 2014 APRIL 19' Location and Time Town Office Building, Parker Room, 8.00 A M Members Present Jill Hai, Chair, David Kanter, Vice-Chair, Bill Hurley, Wendy Manz, Beth Masterman Members Absent None Others Present Rob Addelson, Assistant Town Manager for Finance Recording Secretary Sara Arnold Documents Presented • Notice of Public Meeting/Agenda for February 25, 2014 Meeting • Email from Deborah Brown, Town Moderator, to Ms Hai, February 17, 2014, Re MGL, campaigns, and finance committee members • Draft #1 Capital Expenditures Committee Report to 2014 Annual Town Meeting (ATM) & 2014 Special Town Meeting (Mar 24th) (STM) • Draft #4 Minutes of the CEC Meeting, February 24, 2014 • Draft Minutes of the CEC Meeting, February 12, 2014 Call to Order Ms Hai called the meeting to order at 8.07 A M CEC Member Involvement in the Campaigns of those Running for Town-wide Elections Ms Hai reported on an email from Ms Brown, explaining that the finance-committee members are designated "special municipal employees" by the Board of Selectmen (BoS), and according to Town Counsel, this designation does not prohibit those individuals from campaigning for a person who is running for political office "unless a member is using his or her official committee position for political purposes" In response to Ms Masterman's concurrence and that, thus, our members are not otherwise constrained by the State, Mr Kanter said that the Committee members, however, could—and have in the past—voluntarily agree that limiting our involvement would be a worthwhile position to take Ms Hai also reported that she spoke to Glenn Parker, Chair, Appropriation Committee, about this issue A year or two ago, the Appropriation Committee discussed updating the position it adopted some years ago which restricts such participation—that this Committee had then also adopted—but was unable to reach consensus Ms Hai and Mr Parker are interested in having the two committees meet jointly to explore the issue They agreed, and at this meeting it was generally agreed by this Committee that the two finance committees should adopt the same policy Such a meeting will be scheduled after the 2014 ATM is dissolved and no further action is planned by this Committee until that meeting has been held Page 1 of 4 Minutes of the Lexington Capital Expenditures Committee (CEC) Meeting February 25, 2014 Bond-Related Issues (Affects 2014 ATM Articles 16 & 22) Ms Hai and Mr Addelson provided information regarding 1 Rescission of Unneeded Bonding Authority When Town Meeting authorizes the Town to issue bonds to finance authorized expenditures, but those bonds are never issued, it is necessary for the Town to rescind the authorizations This will be done for several prior authorizations under Article 16 2 Premiums Received by the Town from the Successful Bidder for Town Bonds a. Bidders often offer a payment in excess of the face value of the bonds to be more competitive in the Town's selection process That excess is called a Premium and, in effect, reduces the effective interest rate on the bonds for the Town below the bond's coupon rate—which rate applies when those bonds are sold on the secondary market. While a Premium had always been allowed to be applied to offset the Town's bond-issuance costs—which were over $50,000 for the last bond offering on February 5, 2014—a Premium now also can be applied toward the funding of projects that were exempted from the limitations of Proposition 21/2 by the voters having passed a referendum on such an exemption b At that last bond offering, the Town sold bonds totaling $22,811,000 and the successful low bidder included a Premium of over $3 4 million—which made the net interest rate to the Town to be 1 665% Of that Premium, over $246,000 could be allocated to the new bonds for the exempt projects for the Bridge/Bowman Schools Renovation and the Estabrook School replacement. Under Article 16, the previous debt authorizations for those projects will be reduced (through rescission) by the dollar amounts of their share of the Premium and, under Article 22, the same dollar amounts will be supplemental appropriations to those projects The net effect of those two actions is there is no change in the authorized spending capacity for the projects c The balance of the Premium will be applied back as revenue to the original funding sources and will become available of use by those funds beginning in FY2016 The largest portion of that balance is over $1 6 million for the Community Preservation Fund (CPF) as the new bonding included financing for the purchase of the Wright Farm and the property at 39 Marrett Road for the Community Center 3 Unused Bond Proceeds When a purpose for which a bond was issued is completed and any of the proceeds (the cash) from the bond are no longer needed for that purpose, those amounts will be proposed for appropriation as part of the funding for one or more new purposes and so appear in the Motions for those new purposes The Committee's Report(s) to the 2014 ATM and Accompanying March 24, 2014, STM Updates were provided on several articles/projects—in part by Mr Kanter based on his having attended the BoS meeting the previous evening during which the BoS approved the FY2015 Recommended Budget & Financing Plan ("Brown Book") • Community Center TBD ("to be determined") will be used regarding the request of funds from the CPF to renovate the Community Center because the needed Page 2 of 4 Minutes of the Lexington Capital Expenditures Committee (CEC) Meeting February 25, 2014 estimate for the project is not expected to be presented to the BoS until March 10 Mr Kanter expressed his support for the Town appropriating enough to complete the heating, ventilation, and air conditioning (HVAC) upgrades even if it further delays the opening of the building He suggested that the Community Preservation Committee and the BoS should be informed of this Committee's position regarding this expenditure A Motion was made and seconded to endorse adequate funding for including the recommended HVAC renovations in the initial contract for upgrading the Community Center Vote 5-0 • Fire Station Funding for a new fire station design will be indefinitely postponed A STM could well be called to make an appropriation when funds are needed to evaluate alternative sites for a new fire station • Visitor Center The Tourism Committee and Lexington Historical Society were tasked with resolving their different concepts regarding the scope for this project, but to date the differences have not been resolved The BoS used qualifying language to indicate its support of this project—with scope yet to be determined—is subject to that resolution • Article 12 (Appropriate for Wastewater System Improvements) The Motion will have two parts so as also to address the Pump Station Upgrades • Article 14 (Appropriate for School Capital Projects and Equipment) As done last year, the Motion will include one sub-item which will be a request for an aggregated appropriation for a collection of extraordinary repairs, replacements, and upgrades • Lexington High School Modular Buildings $7 7 million was appropriated at the November 4, 2013, STM for this project, with a 2-phase execution over two years, to provide additional learning spaces The lowest responsible and responsive bid for Phase 1, even after modifying the bid specifications and rebidding, exceeded the allocation of the appropriation for that Phase, thereby leaving what is considered an inadequate remaining balance of the appropriation for Phase 2 A request to supplement the original appropriation by $495,000 will be presented to the ATM so there would be what is considered at this time to be a sufficient appropriation for Phase 2 • Maria Hastings Elementary School Mr Kanter expressed his desire to the BoS for a proactive statement in the budget for the feasibility study regarding renovation/reconstruction of Hastings School as he feels silence on that urgent need sends the wrong message, however, that was not done by the BoS If the Massachusetts School Building Authority (MSBA) were to support the Statement of Interest that has already has been submitted to the MSBA, the funding of that study would need to be addressed by a STM • Cary Memorial Building Renovations The full requested appropriation (about $8 7 million) will be in the recommended budget without any conditions • 39 Marrett Road Sidewalk Construction There is currently no design A Motion was made and seconded to support there being construction of an additional sidewalk, but in the absence of a design, this Committee does not currently support an appropriation of construction funding for the project. Vote 5-0 Page 3 of 4 Minutes of the Lexington Capital Expenditures Committee (CEC) Meeting February 25, 2014 Mr Kanter reviewed the process for writing the report. He would like all remaining draft inputs for the Programs section submitted to him by Friday this week. Ms Hai added that the Appropriation Committee plans to endorse this Committee's report in its report to the Town Meetings rather than continuing the past practice of also extensively addressing the same Capital aspects that this Committee addresses in its report. Initial Sense-of-the-Committee Regarding Its Recommendations on the Warrant Articles Included in Its Report to the Town Meetings Straw votes were taken on each of those Articles and/or sub-Articles All were unconditionally and unanimously supported, 5-0, except as follows • Community Center Sidewalk 0-5, unless a design is available • Visitor Center TBD • Massachusetts Avenue Intersection Improvements Whether this is moved for Indefinite Postponement (because State funding of the construction is not likely in the next few years) or funding is proposed (because funding soon by the State is likely), the vote is 5-0 • Traffic Island Renovation (at Hartwell Avenue and Bedford Street) There were different opinions on whether the request for $83,000 (plus unpriced labor & materials to be provided from the Department of Public Works) was more than the Town should spend on this project. Vote was 2-3 (Mr Hurley and Ms Hai support the project, Ms Manz, Ms Masterman, and Mr Kanter do not) • Fire Station Design Indefinite Postponement of the funding request will be moved, this Committee supports that 5-0 • Appropriate to the General Stabilization Fund It is expected that Indefinite Postponement will be moved for this Article, this Committee supports that 5-0 Approval of Minutes A Motion was made and seconded to approve the Draft #4 Minutes of the CEC Meeting, February 4, 2014 Vote 5-0 A Motion was made and seconded to approve the Draft Minutes of the CEC Meeting, February 12, 2014 Vote 5-0 Adjourn A Motion was made and seconded at 10.37 A M to adjourn Vote 5-0 These Minutes were approved by the CEC at its meeting on March 4, 2014 Page 4 of 4