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HomeMy WebLinkAbout2023-11-30-AC-min 11/30/2023 AC Minutes 1 Minutes Town of Lexington Appropriation Committee (AC) November 30, 2023 Place and Time: Remote participation via a Zoom teleconferencing session that was open to the public; 7:30 p.m.–9:30 p.m. Members Present: Glenn Parker, Chair; Sanjay Padaki, Vice-Chair; Alan Levine, Secretary; Anil Ahuja; John Bartenstein; Eric Michelson; Sean Osborne; Carolyn Kosnoff, Assistant Town Man- ager, Finance (non-voting, ex officio) Members Absent: Lily Manhua Yan Other Attendees: David Kanter, Capital Expenditures Committee; Deepika Sawhney, School Com- mittee At 7:33 p.m. Mr. Parker called the meeting to order and took attendance by roll call. All votes recorded below were conducted by roll call. Announcements and Liaison Reports Mr. Levine reported on the meeting of the School Building Committee (SBC). The Superintendent’s Office has circulated the first draft of an Educational Plan for Lexington High School, which will inform the design process. Comments on the draft are solicited. The SBC will be holding a series of four “visioning” meetings starting on December 5 from 3:30 p.m. to 5:30 p.m. They are recruiting a group of 60 people to participate at all four meetings, which will consist of 40 people connected with the school system and 20 more community repre- sentatives. Mr. Levine encouraged AC members to apply if their schedules can accommodate the meeting times. Mr. Levine suggested that the Appropriation Committee (AC) should consider having a second AC member to participate as a liaison to the SBC, and that the SBC could have its design team present to the AC sometime in March of 2024. Mr. Padaki asked whether cost estimates would be provided with the initial design concepts from the SBC. Mr. Levine confirmed that rough estimates would be done using basic metrics like gross floor space and the gross characteristics of other special features such as solar power requirements. Mr. Padaki asked if the Capital Expenditures Committee (CEC) is engaged with the SBC. Mr. Lev- ine stated that Sandy Beebee, CEC member, and Charles Lamb, Chair of the CEC, have been serv- ing as liaisons from the CEC. Mr. Michelson asked about the SBC process for Article 97 land and whether the Recreation Depart- ment is involved. Mr. Levine stated that the Recreation Department and Recreation Committee have been participating in the discussions. The land that is affected will depend on the design option that is chosen and on the details of the design. The process to make use of Article 97 land cannot start until there is some understanding of which land will be involved. It will then require approval of the plan by town meeting. The plan will then be submitted to the Executive Office for Environmental Affairs (EOEA) for review prior to submittal to the state legislature. The expectation is that the Town could receive approval of its Article 97 request about one year after it is submitted to EOEA and the legislature. Mr. Levine also noted that all necessary Article 97 approvals from the 11/30/2023 AC Minutes 2 legislature must be received before the MSBA Board will execute a funding agreement with the Town for the project. Mr. Bartenstein asked if there would be an item on the warrant for the 2024 annual town meeting about the Article 97 land. Ms. Kosnoff stated that this was expected at a special town meeting in the fall of 2024. Mr. Levine noted that this is expected to allow for just over a year prior to town meet- ing’s vote on the main appropriation for the high school project that would be contingent on a debt exclusion referendum. FY2025 Departmental Budget Requests Mr. Parker stated that the Select Board reviewed departmental operating budget and capital requests for FY2025 on Wednesday and Thursday of this week. Ms. Kosnoff provided some highlights from the Select Board hearings. The impact of all program improvement requests (PIRs) on the General Fund, if they were all approved, would be roughly $1.7 million, most of which would involve annually recurring expenses. Some of the PIRs would support one-time expenses, while others, totaling $243,000, would be funded from sources, such as an enterprise fund or a grant, other than the General Fund. Ms. Kosnoff emphasized that her department is still working on producing a balanced budget, and is behind where she would normally like to be. This is due in part to delays in producing detailed final compensation numbers for FY2025 due to recent settlements of several labor union contracts. Ms. Kosnoff stated that the new settlements of labor contracts will significantly impact FY2025. The recent Fire Department union contract settlement covers FYs 2023, 2024, and 2025. Amounts were set aside in FYs 2023 and 2024 in the Salary Adjustment Account in anticipation of the settle- ment, but the anticipated increases were not nearly as large as the negotiated increases. The net re- sult is that roughly $600,000 from the revenue allocation of $1.7 million for the municipal side will be needed to satisfy the FY2025 contractual obligations for Fire Department compensation. There have also been settlements with other bargaining units this year. There is thus only about $1.1 mil- lion available for both the usual departmental expense increases for compensation, etc., beyond the increases for the Fire Department and the program improvement requests submitted in FY2025. At this time it is not clear that any part of this $1.1 million will be available to support PIRs. Many of the PIRs are for new staffing that have been previously submitted going back several years. Priority PIRs for the Select Board include a Fire Inspector and additional Building Inspection staff which are needed to keep up with the growth in construction. The Building Inspector request is for 0.6 FTE, which would qualify for benefits. It might be possible to partner with another town to spread the impact of the benefits expense for that position. Ms. Kosnoff stated that the Town needs to consider how it funds the services needed to safely support growth, since it is engaging in poli- cies that strongly encourage growth. Ms. Kosnoff stated that her department submitted a one-time PIR for a study of water and wastewater billing rates in order to transition to quarterly billing, and to consider a rate-setting pro- cess that smooths out rate changes by looking beyond near-term cash-flow needs. Any change would have to consider feedback from committees and the public. Ms. Kosnoff noted that another Select Board (SB) priority is increasing participation in the free food waste collection program, which has been supported by ARPA funds. The Board would like to expand the program in FY2025. This aligns with the Town’s sustainability goals, and it would re- duce tipping fees for regular trash service because food waste tends to be heavy. On the other hand, the FY2024 budget assumed that new trash collection fees would be added for certain items, but the 11/30/2023 AC Minutes 3 SB has not implemented any of these fees. Keeping the current operating budget balanced has re- quired changes to compensate for this missing fee revenue from trash collection. The primary driver of increases in the FY 2025 budget is compensation, but other drivers include the cost of diesel fuel, the prices of contract services that involve vehicles, and overall inflation. Ms. Kosnoff offered to send a full summary of all PIRs to the Committee. Mr. Parker and Ms. Kosnoff described Select Board meeting discussion of a PIR to support enforce- ment of the Town’s leaf-blower restrictions and concerns about escalating interactions with the pub- lic and landscape workers. The Select Board would rather not have uniformed officers handling en- forcement, but rather someone like a health department inspector. At the moment, the police are handling most of the complaints, and there have been many such complaints. Mr. Padaki asked if any one-time revenue could be used to bridge the current gap in the FY2025 budget. Ms. Kosnoff responded that the Town budgets for $3 million in new growth, and there is currently a significant set-aside for the Capital Stabilization Fund (CSF), all of which is ongoing revenue. The Town is not ready to compromise its budget guidelines on the CSF set-aside, but that is an accessible source of additional revenue. There is also unused ARPA money remaining that could be used to partially fund the food waste collection program. Ms. Kosnoff repeated that she is still working with the Town Manager to work out a compromise position on the FY2025 budget, which will most certainly require some tradeoffs. Those tradeoffs will likely impact one or more areas, including PIRs, departmental budgets, and the budget guide- lines for the CSF set-asides. Ms. Kosnoff’s opinion is that the Town should be aiming to manage the operating budget based on an annual growth rate of roughly 3.5%, which allows for Proposition 2½ and some modest new growth. For now, the municipal and school departments are working to maintain that approach, and any change in direction would be the result of a serious problem, such as a threat to public health and safety. Mr. Padaki asked about expenses related to immigrants being housed in Lexington. Ms. Kosnoff stated that the Town is hosting about 30 immigrant families at the Aloft and Element hotels. There is no major impact on the Town budget because the state covers the costs of housing, education, and social services. The only impact is a certain amount of staff time to assist in monitoring the situa- tion. Ms. Kosnoff stated that the Town Manager is the main point of contact for services provided to these families, but the Public Health Director is deeply involved in meetings and helping to coordi- nate volunteer support. The National Guard has the primary responsibility for providing services, access to work information, school, transportation, and everything else. Mr. Parker mentioned that due to a lower state match (21.8%), annual CPA revenue had fallen by about $1 million, and asked if that will impact capital requests. Ms. Kosnoff stated that the original budget had assumed a 30% match, but that the shortfall would mostly be absorbed by higher than anticipated interest income. Nevertheless, the total of CPC requests was about $1.7 million more than the available funding. The project to renovate the lower floor of Cary Memorial Library will cost about $5.5 million, with about $1.5 million coming from the Cary Memorial Library Foundation. The CPC offered to fund another $2.3 million with the General Fund providing the remaining $1.7 million via within-levy debt. This would allow the CPC to fully fund its remaining requests, which include community and affordable housing. 11/30/2023 AC Minutes 4 Future meeting topics Mr. Parker asked the members if they had any ideas for future meeting topics that were not directly related to the upcoming Town Meeting. No ideas were offered, but Mr. Parker noted that he was al- ways happy to hear suggestions. Recording Secretary Mr. Parker noted that he is still using an AI-based product to create meeting transcripts from record- ings as part of his process for creating minutes. Ms. Kosnoff stated that she has received some new applications for the unfilled Recording Secretary position. Approve Minutes of Prior Meetings Minutes from the Committee meetings on November 7 were approved by a vote of 7-0. Future Meetings The Committee indicated that it would like to meet on December 14, at which time there will be a near-final version of the warrant for the 2024 ATM. Adjourn The meeting was adjourned at 8:43 p.m. Respectfully submitted, Glenn P. Parker Approved: December 14, 2023 Exhibits ● Agenda, posted by Mr. Parker