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HomeMy WebLinkAbout2024-01-25 FY2025 Financial Summit III-min FY2025 Financial Summit III Select Board, School Committee, Appropriation Committee & Capital Expenditures Committee January 25, 2024 The Budget Summit III meeting was called to order by Select Board Chair Joe Pato at 7:00 p.m. on Wednesday, January 25, 2024 via hybrid meeting services. Present for the Select Board (SB): Mr. Pato, Chair; Ms. Barry, Vice Chair; Ms. Hai; Mr. Lucente; and Mr. Sandeen as well as Mr. Malloy, Town Manager; Ms. Axtell, Deputy Town Manager; Ms. Katzenback, Executive Clerk Present for the School Committee (SC): Ms. Sawhney, Vice Chair; Ms. Jay; Ms. Lenihan; Mr. Freeman (7:12pm arrival); Dr. Hackett, Superintendent of Schools; and Mr. Coelho, Assistant Superintendent for Finance and Operations. Present for the Appropriation Committee (AC): Mr. Parker, Chair; Mr. Padaki; Mr. Ahuja; Mr. Bartenstein; Mr. Levine; Mr. Michelson; Mr. Osborne; Ms. Yan. Present for the Capital Expenditures Committee (CEC): Mr. Lamb, Chair; Mr. Kanter, Vice Chair and Clerk; Ms. Rhodes; Ms. Beebee; Mr. Boudett. Also present: Ms. Kosnoff, Assistant Town Manager for Finance; Ms. Impink, Town Budget Officer Public comments were not taken during the meeting. ITEMS FOR INDIVIDUAL CONSIDERATION 1. FY2025 Financial Summit III  FY2025 Preliminary Budget and Financing Plan Ms. Kosnoff explained that, at Summit II, there was $289M of revenue projected. After reviewing the shared expenses and other set asides, there is a new revenue projection of $6.774M, which gave just over $5M to the school department and $1.7M to the municipal departments. The total revenues have increased just a bit, at $289,642,000, leading to a total new revenue allocation of $7.8M. This puts both departments in a much better position than at the last summit. At Summit II, both the municipal and school departments were looking at an increase of 3.7% over last year's fiscal 24 budget; this is now projected at a 4.3% increase. The calculations led to a net approximately $348,000 of new revenue. Ms. Kosnoff explained that part of the Town’s trash and recycling contract covers trash and recycling for the schools and for the municipal buildings. Therefore, it was agreed that this could be a shared expense. The total amount of the trash and recycling contract that is attributable to the school and municipal buildings has been added as a shared expense. Regarding the municipal side, after reviewing the revenue allocation, there was not originally a lot of money to be allocated to fund any program improvements. However, Staff took another look at the budget and made requests to shave amounts from different areas. Overall, the municipal departments cut out a total of $723,000 and the Facility department cut out $256,000. This allows for funding of some key Program Improvement Requests (PIRs). Overall, there was a total of $1.9M of PIRs across all municipal departments, with $1.6M requested from the general fund. Of the total general fund request, $441,000 has been approved to come from new revenues from the general fund. Most of that will be in the municipal department. There are $580,000 of projects that are not being funded.  Capital Expenditures Committee - Preliminary Report: FY2025 Proposed Capital Projects Regarding the overall financing plan, Ms. Kosnoff explained that, in total, there is a request for $49M in capital projects for fiscal 25. $16M of that is proposed to be funded with cash capital funding, with another $12M requested from other funding sources, including the Water and Sewer Enterprise and other small funding sources. The Community Preservation Act has an $8.4M capital plan for fiscal 25. There is also a general fund debt of $20M, with $10M of that for the design funds for Lexington High School. Ms. Kosnoff explained that just over a week ago, Staff issued a formal RFP for leased space within Lexington which could potentially house the School Administration, instead of using 173 Bedford Street. The two main items that are needed for 173 Bedford Street are to replace the HVAC system and to add an elevator. The $6M price tag reflects converting the building to an all-electric HVAC system, which is much more expensive than getting a new HVAC unit and leaving all the existing ductwork. If the existing system was left in place, the price tag comes down to approximately $4.5M. Mr. Bartenstein (AC) asked if any arrangement has yet been made for the use of the basement of the Muzzey condominiums that used to house the Senior Center, or if it is possibly suitable for School Administration facility. Mr. Malloy explained that there are deed restrictions that the space needs to be used for seniors. There are also code violations in the building that need to be cured. Ms. Kosnoff explained that, regarding debt financing for the Kary Memorial Library project, this project is actually split funded. It is going to be partially funded from CPA funds, partially funded from the general fund via a bond issue, and a component to be picked up by the Library Trust. The total price tag for the project is $5.5M. The Library Trust is committing $1.5M of funds, with $4M of Town funds needed that will be paid from CPA and the general fund. Regarding Lincoln Park, there is a $1.8M request from CPA funds to replace the turf and systems. There is also $160,000 request to replace fitness stations on the fitness path. Some funds have been requested from the Trustees of the Public Trust. Lastly, there is a $30,000 request for a feasibility study on installing a solar canopy over the parking lot at those fields. Ms. Kosnoff explained that the Affordable Housing Trust, which was established at the last Town Meeting has requested $3.2M of CPA funds to fund future property purchases and/or affordable housing production. Regarding stormwater management, this now contains three programs combined into one for fiscal 25. Regarding the Capital Stabilization Fund, Ms. Kosnoff explained that Staff does not anticipate taking any money out of this fund to mitigate debt service for fiscal 2025 or 2026. Ms. Sawhney (SC) suggested putting a bit of funding into the Special Education Reserve Fund each year as a way to cushion from certain unexpected fluctuations. Mr. Levine (AC) suggested a summit in early March to discuss whether to go forward with a renovation or leasing of 173 Bedford Street. Mr. Lamb (CEC) discussed the CEC’s viewpoint regarding the High School and 173 Bedford Street projects. He explained that the group has concerns regarding the large the number of large projects seeking Community Preservation Fund funding. The CPC put out a needs assessment which showed approximately $48M of anticipated known requests in the coming years, with approximately $40M of anticipated revenue.  Review 2024 Annual Town Meeting Articles Ms. Axtell explained that the warrant was voted on Monday by the Select Board. There are 54 articles in total, 24 finance and 22 general articles, which includes eight citizen petitions and eight zoning petitions. The Town Meeting webpage is live on the Town webpage at this time. There will likely be information sessions scheduled in early March. DOCUMENTS: FY2025 White Book – Presentation, CEC Comments to the Third Summit Regarding FY2025 CIPs, FY2025 Preliminary Budget & Financing Plan (White Book), ATM 2024 warrant ADJOURN Upon a motion duly made and seconded, the Select Board voted 5-0 by roll call to adjourn the meeting at 8:47p.m. The Appropriation Committee, Capital Expenditures Committee, and School Committee followed suit. A true record; Attest: Kristan Patenaude Recording Secretary