HomeMy WebLinkAbout2010-ATM-CEC-rpt (supplement & errata) SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
CAPITAL EXPENDITURES COMMITTEE
TOWN OF LEXINGTON
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SUPPLEMENT (including Article 9: Land
Purchase Off Marrett Road)
to the REPORT TO
THE 2010 ANNUAL TOWN MEETING
(Released March 31, 2010)
with ERRATA to it and to the REPORT TO THE
2009 ANNUAL TOWN MEETING
(Released March 30 2009)
(Supplements Errata released April 12, 2009 to the 2009 Report)
Released April 28, 2010
Submitted by:
Charles Lamb, Chairman
Ted Edson, Vice-Chairman
William Hurley
David G. Kanter
Shirley Stolz
SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
UPDATES
Page 2 & 65 (Inside front & rear covers)
Summary of Warrant Article Recommendations
Abbreviations: RF =Revolving Fund; CPF = Community Preservation Fund;
EF=Enterprise Fund; RE =Retained Earnings; GF = General Fund;
SF = Stabilization Fund; TBD = To Be Determined; ATM=Annual Town Meeting
CEC
Art. Description Request Recommended 1 Funding Source
8 Community Preservation Committee Operating Budget&CPA Projects
8(I) Town Office Building Renovation $1,825,500 $1,825,5001$1,1b8)5,500 CPF(Cash)+$640,000 GF
(Debt)
9 I Land Purchase—Off Marrett Road $3,857,000 $3,857,000$1,557,000 CPF(Cash)+$2,300,000
CPF(Debt)
15 School Capital Projects and Equipment
15(b) Food Service Equipment I $99,5001 $99,500IGF(Debt)
Page 32
Funds Funding Committee
Requested Source Recommends
Article 8: Appropriate
the FY2011 Community $8,184,982 $7,544,982 CPF(Cash) (See below)
+$640,000 GF(Debt)
Preservation Committee
g
O eratin Budget and
p
CPA Projects (Multiple
Categories)
Page 36
Project Description(CPA Category) Amount FundingSource Committee Recommends
Requested
(1) Town Office Building $1,185,500 CPF (Cash)
1 Approval (4-1)Renovation Historic Resources 825500 +$640000 GF Debt pp
Note:Except for the small change in the total amount, the revision in the balance between the
funding sources and, based on the revised CPF funding, the change in our Committee's
position (from 3-2), the rest of the analysis section remains valid. (See the updated Appendix
on page 6 of this supplemental report for a perspective on the current and projected funding
level in the CPF.)
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
Page 41
The following supersedes our previous report on this Article
Article 9: Land Approval Funding Committee Recommends
Parchase Offillarrett Requested Source
Road(Open Space) $3,857,000 $1,557,000 CPF Approval (5-0)
(Cash)+
$2,300,000 CPF
(Debt)
"... to purchase or otherwise acquire... all or any part of land shown as lots 90B and 60B on Assessors'
Property Map 31, now or formerly of Cataldo...." [Town of Lexington Warrant for 2010 Annual Town
Meeting, Page 10]
"This project proposes acquisition of a portion of the 121 Marrett Road property known as the Cotton
Farm by the Town to preserve open space...The Cotton Farm is a very visible property of approximately
10.2 acres along Marrett Road that includes a mid-20th century house framed by an orchard to the south
and wetlands and woodlands to the north, east and west. The property is listed in Lexington's
Reconnaissance Report of 2006 as a Priority Heritage Landscape in that it reflects the history of the
community,provides a sense of place, shows the natural ecology that influenced land use patterns and has
scenic qualities." [Brown Book, Page XI-21]
While a Letter of Agreement between the seller and the Town is not yet available but has been promised
prior to presentation of this Article to this Town Meeting this Committee's understanding of the
primary terms are as follows:
(1) The following shows the proposed purchase which is for conservation purpose only and the
adjacent property which would have new deed restrictions as part of the purchase agreement.
Upper Vine Brook
Conservation Area
•
—4.0 acres
- " (4-Lot Restriction) -
= Proposed
• Purchase
—4.2 acres '
Deed Restriction
—1.9 acres
(Conservation
• Restriction)
are - '
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
(2) The Town would pay $3.8 million for about 4.2 acres through which there is a current roadway
whose residential use (e.g., no development traffic) would continue to be available to the existing home at
the rear of the adjacent land to the right (east) of the proposed purchase until the current occupants no
longer inhabit that home.
(3) Deed restrictions would be placed on that adjacent about 5.9 acres to the right which include a
conservation restriction on the front about 1.9 acres along Marrett Road precluding any development, but
allowing for a potential access roadway and upgraded utilities from Marrett Road to the about 4.0 acres
that are to the rear of the restricted acreage; and a restriction to a total of 4 lots/homes, including the
currently existing home, or its replacement which development, because of the conservation restriction
on the front portion, would have to be on the rear about 4.0 acres.
(4) Although not falling under the scope of this Article, associated with the purchase would be a gift
by the seller to the Town of about 14.5 acres on Hartwell Avenue. (Although there is no current appraisal
of the value of that parcel, as at the moment it is not buildable due to wetlands along its frontage on
that roadway, its current value has been estimated as less than $100 thousand.) That property is as shown
in the following:
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Cataldo Property Q Cataldo Property
H a rtwe l I Avenue im Town Conservation Land
1 02 Other Public Lands °° 0 300 600 900 Feet
4.5 acres
The Board of Selectmen would accept that gift; Town Meeting action is not required.
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
Returning to the 4.2 acres proposed to be purchased by the Town, a proof plan based on preliminary
engineering had been provided by the seller showing that it has the potential to be subdivided into nine,
by-right, building lots. That property has been evaluated by two independent appraisers, both based on a
"highest and best use" market valuation. One appraisal concluded there was a $4.4 million value; the
other, a $3.7 million value. (Neither appraisal assigned any value to the two deed restrictions on the
adjacent land.) While the Town is constrained by law not to spend more than the appraised value and
although the conclusions of the two appraisals differ by a significant dollar amount, as neither's
methodology or data has been formally refuted,the Town is not legally constrained to the lower value.
In addition to the $3.8 million purchase price, it is anticipated that there would be up to $57 thousand of
closing costs to the Town.
This Committee has reviewed and endorses the proposed financing approach which involves the use of
$1.557 million of Community Preservation Fund (CPF) cash in FY2011 ($1.5 million to the seller at
closing, expected in the last half of this calendar year, and the $57 thousand for those closing costs) with
the seller taking back a 2-year, interest-free, bond for the $2.3 million balance ($1.3 million to be paid
from the CPF in FY2012 & $1.0 million from the CPF in FY2013). As we have reported before, to the
extent it's practical, we urge the use of cash and, if debt is necessary, then we urge that it be of a short
term and front-loaded. The proposed approach for this land is fully consistent with that principle.
This Committee recognizes that the proposed land purchase has long been a priority of our Town's
Conservation Commission as its acquisition would protect an exceptional streetscape, provide a
wonderful addition to our conservation-land holdings, and is further of value because it provides as
shown in the earlier drawing public connectivity to existing conservation land and the opportunity for a
limited, off-road, parking area in proximity to conservation land. However, we are deeply concerned that
this purchase represents an extraordinarily expensive action and we do not ascribe to the concept that our
Town should purchase any and all conservation land at any price even if offered at less than an
appraised value. While more conservation land is an enhancement, it is not necessarily always the highest
and best use of our Town's financial resources. After all, Lexington is not bereft of conservation land. We
understand that about 1,400 acres in our Town is already under conservation protection which is about
13%of the Town's about 10,650 acres).
Further, we fully appreciate that the acquisition of open space is a designated purpose of the Community
Preservation Act (albeit only one of the designated purposes), but at the $3.8 million purchase price for
the Cotton-Farm land, that would not only represent a significant draw on the CPF (see the updated
Appendix on page 6 of this supplemental report for a perspective on the current and projected funding
level in the CPF), it represents at about $905 thousand/acre an extremely high, and new level, for a
per-acre payment. (While we recognize that this is a totally different kind, and location, of land than was
last-year's purchase of the 7.93 acres of Busa-Farm land, that $4.1 million purchase represented a cost of
about $517 thousand/acre.) We can also see that in our eagerness to acquire this parcel, even at such a
high per-acre price, we may well ratchet up the expectations with regard to future potential acquisitions.
However, from our Committee's perspective, this project has been well defined, proposes to use an
appropriate funding source and approach, and would be of value to our town.
Therefore, in our role as an advisor to Town Meeting, we unanimously recommend you approve
this request. But,in the end, this Committee acknowledges that the value judgment being called for
here, in regard to whether this is a prudent purchase at this time, is a subjective one that cannot be
based solely on quantitative matters. Such judgments are for Town Meeting to make.
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
Page 53
Project Description Amount Requested Funding Source Committee Recommends
(b) Food Service Equipment $99,500 GF(Debt) Approval (5-0)
Note: The only change is in the Project Description with the deletion of"and Software"; the
analysis section remains valid.
Page 63
The version of the Appendix on the next page supersedes our previously published version.
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
Appendix: Community Preservation Fund Cash for FY2011
Note: Where we use collected amounts, there will be relatively small differences from those line items in sources.
Can Expend in
Items Amount($) FY2010 FY2011 Comment
From FY2010 Budget—Unaaaroariated Balances
Open Space Reserve 397,207 Yes Yes
Historic Resources Reserve 141,194 Yes Yes
Community Housing Reserve 7,289 Yes Yes
Unbudgeted Reserve 935,336 Yes Yes FY2010 Revenues less FY2010 Appropriations Net of
other Reserves
Subtotal for FY2010 1,481,026 Yes Yes
Undesignated Fund Balance(exclusive of State 4,103,488 Yes Yes Prior FYs'Unbudgeted Reserves plus Booked
Match received in FY2010) Investment Income
Estimated State Match received in FY2010 on 869,162 Yes Yes Based on being 29 73%of the$2,961,858 commited
FY2009 Surcharge FY2009 Property Surcharge and a 98.69%collection
rate (See below for true-up to 36 2%actual match)
Subtotal of Undesignated Fund Balance 4,972,650 Yes Yes
Total from all Prior FYs(excluding State Match 6,453,676 Yes Yes Without any returns of unused appropriations for
"True-Up') completed projects and unbooked Investment Income
State Match True-Up 191,228 No Has a Additional 6.5%,over the above estimated match,to fully
Qualifi- fund the$1,060,390 actual match Can only be used after
cation FY2010 closes and has been certified by the State
Department of Revenue—typically in the September time
frame
Total from all Prior FYs 6,644,904 Without any returns of unused appropriations for
completed projects and unbooked Investment Income
From FY2011 Budget
Revenues
Property Surcharge(Estimated) 3,111,416 No Yes -98 68%collection against committed$3,153,000
State Match on FY2010 Surcharge(Estimated) 941,700 No Yes In 1st round,estimate 31 00%of committed FY2010
Property Surcharge($3,078,358)after applying collection
rate of-98 68%
Investment Income(Estimated) 50,000 No Yes
Total FY2011 Revenue 4,103,116 No Yes Basis for 10%allocations
Total Available to CPC(Prior Year+FY2011 10,748,020 Without any returns of unused appropriations for
completed projects and unbooked Investment Income
Proposed Appropriations
Open Space 1,717,000 Article 8(a)(50%of$320,000),Article 9($1,500,000 cash.
portion of purchase plus$57,000 closing costs)
Historic Resources 2,356,533 Articles 8(g)$150,000;(h)$100,000,(i)$60,000;(j)
$25,000,(k)$73,000,(I)$1,185,500,(m)$35,000,(n)
$31,700,(o)$45,100,(p)$18,000,(q)$202,933,(r)
$400,000;(s)$5,300;&(t)$25,000
Community Housing 1,091,129 Articles 8(d)$386,129;(e)$10,000;&(f)$695,000
Recreational Use 1,225,220 Articles 8(a)(50%of$320,000);(b)$190,047;&(c)
$875,173
Administrative Budget 150,000 Article 8(v)
Subtotal of Proposed Projects 6,539,882
Busa-Farm Land Debt Service 2,562,100 First of 3 payments
Subtotal of Proposed Projects&Debt Svc, 9,101,9821
Mandatory Allocations to Reserves Based on$410 312 Ending Balance That allocation basis is 10%of FY2011 Revenue
Open Space 0 0 These three allocations are using a minimum allocation
Historic Resources 0 0 approach while the Town uses an alternative of
Community Housing 0 0 allocations,as needed,to match the proposed
Subtotal of Allocations to Specific Reserves 0 0 appropriations in each category
Total New Uses(including to Reserves), 9,101,9821
Balance for Only FY2011 Revenue/Expenses -4,998,866 Information only;not used in other calculations
Cumulative Balance(including Reserves), 1,646,0381
Partial Balance Available to CPC for Next Full-Cycle of Projects(See comments for qualifiers)
Total Remaining Available to CPC 1,646,038 Also doesn't include adjustment to final State Match
(including Reserves) in FY2011 or unbooked investment income.
Est Returned Prior-Proj Residual Balances 479,500 Est.unused amounts from prey funded projects
FY2012 Surcharge Revenue(Estimated) 3,220,316 3.5%increase over FY2011 collected.Doesn't include
estimated investment income in FY2012
Estimate of State March to be Rcvd in FY2012 1,000,000 Based on some increased match rate over FY2011
Busa-Farm Land Debt Service -974,600 Second of 3 payments
Busa-Farm Debt Share of Premium&Accr Int 217,287 From participating in Town's Feb 2010 Bond Sale
Cotton-Farm Land Debt Service -1,300,000 First of 2 interest-free bond payments(principal only)
Partial Bal Available for Next Full Cycle>_I 4,288,5411 Per above comments;expected to be a minimum
Allocation for Preferred General Reserve -2,000,000 Not mandatory
Partial Bal Avail for Next Full Cycle w/Reserve>_ 2,288,541
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SUPPLEMENT to the CEC REPORT TO THE 2010 ANNUAL TOWN MEETING with Errata
ERRATA
In the 2009 Report,page 17, 2nd full paragaph, line 5,and in the 2010 Report,page 19,line 3: Change
"almost 1,050 parking spaces"to "99 parking spaces".
Also in the 2010 Report:
Page 12, The Community Preservation Act (CPA), 1st paragraph:
(a) In lines 6 &7, change:
"$14,542,865"to "$14,522,865",
"$2,557,468 (17.6%)"to"$3,157,468 (21.7%)",
"$3,556,645 (24.5%)"to "$3,566,645 (24.6%)",and
"$7,322,117 (50.3%)"to "$6,692,117 (46.1%)"
(b)In the table, last column,last line, change ">$926,356t"to ">$941,700t"and in the footnote,
change"98.69%"to"98.68%".
7