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Home My WebLink About2017-08-31-AC-min08/31/2017 AC Minutes Minutes Town of Lexington Appropriation Committee (AC) August 31, 2017 Place and Time: Parker Room, Town Office Building, 7:30 p.m. Members Present: John Bartenstein, Chair; Alan Levine, Vice -Chair & Secretary; Ellen Basch; Richard Neumeier; Andrei Radulescu-Banu; Sanjay Padaki; Lily Manhua Yan; Jian Helen Yang; Carolyn Kosnoff, Assistant Town Manager, Finance (non-voting, ex officio) Members) Absent: Eric Michelson Other Attendees: Joe Pato, Selectman; Kate Colburn, School Committee The meeting was called to order at 7:37 p.m 1. Announcements Mr. Neumeier reported the following: • In July, the Supreme Judicial Court of MA agreed to hear an appeal of a Superior Court ruling against the Board of Selectmen of the Town of Wayland for violation of the Open Meeting Law premised on the advance circulation of board members' employee evaluations by email (Docket No. 12353). A decision is likely in the winter that may be relevant to the Town of Lexington. An amicus brief may be filed up to two weeks before the matter is scheduled to be heard, but would require legal counsel. Mr. Bartenstein will review the docket to determine whether there are matters of interest to this Committee. • A lawyer's publication recently listed an open position for an assistant solicitor in Worcester, salary $61,591 + excellent benefits. Mr. Neumeier is working on a report, as discussed at a prior meeting of this Committee, that discusses the advantages of hiring in-house counsel versus outsourcing work. Mr. Bartenstein reported the following: The Board of Selectmen (BoS) meeting on Monday, Aug 28, 2017 included a presentation by Mr. Himmel of the Permanent Building Committee (PBC) on value -engineering options for the new Hastings Elementary School. Mr. Himmel stated that value engineering is a continuous process, but the potential options that are still under discussion total approximately $1.15M beyond what has already been incorporated in the current design. At a joint BoS and School Committee meeting on Aug 15, 2017, there were presentations by the PBC, as well as by the Sustainable Lexington Committee, with additional information beyond that in the Green Engineering report regarding the geothermal heating system for Hastings Elementary. These presentations contain useful information for the write-up of the warrant article. Michael Cronin, who has an extensive background as a facilities administrator with the Newton Public Schools, has been appointed as the new Facilities Director to replace outgoing Director, Pat Goddard. He will start in mid- September. 08/31/2017 AC Minutes 2. Election of Officers for 2017-2018 A motion was made and seconded to re-elect Mr. Bartenstein and Mr. Levine as Chair and Vice Chair/Secretary respectively for the 2017-2018 Fiscal Year. No other nominations were made for any of these posts. The motion passed. VOTE: 7-0-1 A write-up about the AC, its members and officers, and the activities of the past year needs to be provided for the Annual Report of the Town by October 30. Mr. Neumeier agreed to draft this document. A photograph for the report will be needed at one of our upcoming meetings. 3. Current Financial Status Ms. Kosnoff provided a brief update on the Town's financial status. There have been no material changes to FY2018 operating expenses. There have been three significant changes to FY2018 revenue estimates since the 2017 Annual Town Meeting: Chapter 70 aid on the State's final Cherry Sheet was $2.6M higher compared to budget, as had been anticipated. The Community Preservation Act (CPA) state match came in at 15% versus the budget of 19% (already lowered from 21% in the prior year). This amounts to reduced CPA revenue of approximately $175K. This will require some of the CPA fund buckets to be reworked. The revenue from new growth is trending towards —$3.OM which is higher than the budget of $2.5M. Final numbers are expected to be available in November. The amount over that budgeted will flow into Free Cash at the end of the fiscal year. 4. Preparation for Capital Summit of Sept 13, 2017 The committee discussed the potential ballot questions for the Town -wide debt exclusion vote that is expected to be the focus of the Capital Summit on Sept 13, 2017. The items which might be included on the debt exclusion ballot, totaling about $96.8M, are: • Construction of Hastings Elementary - $48.7M (net cost to Lexington after MSBA contribution of $16.5 million, total estimated project cost of $65.2M) • Main Fire Station and temporary swing space @ 173 Bedford St. - $20.9M • Lexington Children's Place at Pelham - $14.75M • Purchase of Pelham - $8.OM • Purchase of 173 Bedford St. - $4.45M The committee debated the pros and cons of combining some of these items on the ballot question(s). The committee did not reach a consensus position and the debate is expected to continue during the September 13 Capital Summit. The BoS will make a final decision, likely in October. The ballot item for the construction of the Hastings Elementary school is required to be a separate vote. The committee deliberated whether the Special Town Meeting 4 08/31/2017 AC Minutes appropriation for Hastings should be made contingent on the town -wide debt exclusion vote. This has been the case for prior debt exclusion votes in recent years. The committee debated the pros and cons of the approach but did not reach a consensus position. The BoS will make a final decision prior to the Special Town Meeting. This Committee has previously recommended that the already -completed purchase of the properties at Pelham Road and Bedford Street be financed directly from the Capital Stabilization Fund (CSF) rather than being included in the debt exclusion. This has the potential to save significant money on a yearly basis due to the spread between interest earned on the CSF and long-term interest rates. These purchases are currently financed on an interim basis by 1 -year Bond Anticipation Notes (BAN'S) at an interest rate of —1%, which is similar to the rate being earned on the balance in the CSF. The Town Manager has proposed rolling over the BAN'S (which can now be done for up to 7 years) and deferring a decision whether and when to fund the Pelham Road and Bedford Street property purchases from the CSF until a future date. The committee deliberated the pros and cons of both approaches but did not take a final position. The committee was in agreement that a revised version of the existing financial model is essential to making an informed decision, although the exact items to include in the model are still being debated. Ms. Kosnoff indicated that she is in the process of developing a revised model. s. Liaison Opportunities Mr. Bartenstein noted that several current or proposed advisory working groups either have, or would benefit from, AC liaison involvement: • Comprehensive Plan Advisory Group being formed by the Planning Board • Economic Development Task Force (for commercial development) being formed under the direction of the BoS • Working group to inform the BoS on potential revision of the CPA surcharge • Working group to inform the BoS on potential adoption of a residential exemption. This effort is already under way, and Mr. Radulescu-Banu and Mr. Bartenstein are currently participating. 6. Minutes A motion was made and seconded to approve minutes for July 11, 2017. The motion passed. VOTE: 9-0 7. Future Meetings. The next meeting will be held on Sept 14, 2017. The meeting adjourned at 9:27 p.m. Respectfully submitted, Sanjay Padaki Approved: September 14, 2017 Exhibits Agenda, posted by John Bartenstein, Chair