2019-03-13 TOWN OF BERLIN
BOARD OF FINANCE BUDGET MEETING
REGULAR MEETING
Wednesday, March 13, 2019
John "Doc" McIntosh Conference Room
7:00 P.M.
A. CALL TO ORDER
Chairman Lomaglio called the meeting to order at 7:00 p.m.
B. PLEDGE OF ALLEGIANCE
C. ROLL CALL
ATTENDANCE:
Members Present: Sal Bordonaro, Kevin Guite, Mark Holmes, Sam Lomaglio, Gerald Paradis,
John Richards
Staff Present:
Jacl: Healy— To���n Manager
Kevin Delaney—Finance Director
D. DISCUSSION ON DEPARTMENT BUDGETS:
1. Discuss Fiscal Year 2020 Proposed Budget
Board of Finance members discussed several points including:
• Grant���riter Mr. Mahone}�—salary increased to $42,000 —is this money better spent
on Economic Development promotions? Town Manager Healy stated that Mr.
Mahoney continues to bring returns on the investment in his salary. He seeks out
grants, applies for grants, manages the projects associated with the grants (assuring
Berlin's compliance ��ith the terms), ���rites RFQs, communicates/ coordinates with
the Department of Transportation and Department of Economic Development. The
salary increase is related to the anticipated increase in hours required for the
upcoming Community / Senior Center grant.
• Town-�vide Wage Reserve—is this entry already earmarked for a specific
settlement? Finance Director Delaney confirmed that there is a contract in
negotiation currently, and���hen it is settled the funds will be moved to the
appropriate departments.
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• Opportunities for overall reductions in the General Government Operations?
Finance Director Delaney stated that the To�vn budget has been "tight'° for several
years and there is no clear area to scale back while maintaining services. To��n
Manager Healy stated that the desirable but non-essential services like Library, Parks
& Recreation (programs, pools) and other To�ti�n facilities (operating hours, part-time
stafting levels) ���ill be affected by any reduction to the proposed budget. The level
of impact depends on the le��el of the reduction. Board of Finance asked for specific
impact of potential reductions of$200,000, $300,000 and $500,000.
Town Manager Healy also e�plained that the General Government budget houses
etipenses for Board of Education (including general insurance, refiise removal, debt
service, the school securit5� proposal, and the State's requirement of teacher pension
contribution).
• Debt:
o Long term liabilities—The Defined Benefit Pension has been underfiinded
for many }�ears. The proposed budget includes a contribution to the pension
fiind as determined by the actuarial consultants. Currently, t«-o retirements
are etpected in FY 2019/2020.
o Elisting debt service payments.
o New bonding—about $3,700,000 ($2,200,000 could be eliminated if projects
are deferred). The parties agreed that Berlin has an unhealthy� level of
bonding debt (12%) and the current financial difficulties ��•ill not end if�ve
keep adding to the bonding debt. The proposed budget includes bonding to
fiind Railroad Dam repair, Burnham Street Bridge repair, Scalise Field
renovation and fire radios. It���as noted that the bonding has a lead time of 1
year, so that projects can be e�-aluated, fiinded, and acted on.
The State has determined that ���ork is required on the dam and bridge. The
renovation of Scalise Field could be deferred, although it is not advisable.
The turf field is 14 years old, yet has a manufacturer's usefiil life of 8-10
5�ears. The field condition could cause injury and elpose the Town to
litigation and damages.
Deferral ofthe $1,200,000 Fire Radio System upgrade is also possible, but
��-as not recommended. Fire Administrator Jim Simons stated that the recent
$27,000 spent to repair a broken component���as necessary to get the current
s}�stem operational for the short-tern1. The system services Fire, Highway,
Public Works and Emergenc}� Management. This item �vas prioritized and
placed into the Capital Plan after determining that it�vas more urgent than the
previously scheduled Fire Apparatus replacement. (The Fire Radio System
replacement �vas originally on the Capital list for the 2020/2021 budget.) Mr.
Simons cannot guarantee that the eyisting system �vill perform for any� period
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of time, nor can he forecast its failure ��ithin a period of time. He did,
ho�vever, report a recent Emergency Management e��ent in which the radio
system failed.
Board of Finance inquired if Fund Balance may be used to pay for projects
instead of borro�ving, but Finance Director Delaney� indicated that is not
possible. The proposed budget already contemplates a transfer of$2,600,000
from General Fund balance. Finance Director Delaney did state that several
steps are being taken to impro��e Berlin's financial standing, including: 1)
Being thrifty with elpenses to drive surplus; 2) Assertive collection of tax
re��enue; 3) Close out grants as soon as possible; 4) Use operating surplus to
pa`• off debt.
Finance Director Delaney re�•ie���ed some of the projects that make up the
e�isting bonding debt, includina the Berlin High School renovation, fire truck
purchases, open space acquisitions, road paving, McGee Middle School
renovation, Pistol Creek purchase, school roof replacements, Sher���ood Mill
property. Berlin also entered into a $10,000,000+ lease of energy equipment
(solar panels) �vith an escalating repayment schedule.
• Ramification of reductions - Board of Finance members discussed the financial
ramification of possible $500,000 reductions to the Board of Education and General
Government budgets: The current budgets represent a?.72 mill increase. Reducing
both budgets by $500,000 totals a $1,000,000 reduction ��-hich equates to onl`� a .5
mill reduction.
• Alternate options - Mr. Richards pro��ided a���orksheet «-hich detailed decreases to
operating costs and increases to capital. His proposals contemplate a 4.5% increase
for Board of Education operations (including 3.0% as base increase and 1.5% as
"catch up'" for the last se��eral years of lo��- fiinding), a 3.�% increase for the To���n
budget, inclusion of the $0.400M school security proposal, and a $1.900M increase
to General Fund Capital (increase from last y�ear's $1?M increase). Mr. Richard's
suggestion allo��•s for an increase in filnding of capital items for both General
Government and Board of Education, citing his goal is to continue to trend up���ard
each FY until the $4.5-5.0 million annually is achieved, as is seen in the 10-}�ear
to�vn capital plan.
• Board of Education—the proposed budget requests a $2,600,000 (or almost 6%)
increase. After the Board of Education's budget presentation and study of the budget
line items, the Board of Finance discussed their opinions (non-binding stra�� vote)
for possible changes.
Mr. Bordonaro - change increase to $900,000. (Mr. Bordonaro formed his
recomrnendation based on estimates he created for uncommitted amounts in the
current Board of Education budget.)
Mr. Guite—change increase to $1,300,000.
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Mr. Holmes - change increase to $1,300,000.
Mr. Paradis—change increase to $1,300,000.
Mr. Richards—change increase to $1,600,000.
Mr. Lomaglio —change increase to $1,300,000.
• General Fund Capital List—proposed $8�3,782, including:
o $ 2,000— Records Management
o $146,000 - Police Patrol Vehicles
o $ 38,500—Police Supervisor/Admin SUV
o $ 30.000—Police Unmarked Police Vehicle
o $ 70,000 - Flatbed Po���er Lift— Highwa}' Department
o $ 1�,000 - Asphalt uploader
o $ 7�,000 - Senior Center Kitchen & �-arious repairs
o $ �0,000 — Senior Center HVAC
o $ �0,000—Communit}' Center - Handicap Door
o $120,000 - Municipal Garage Roof Replacement (attemptin��to utilize LoCIP
fiinding. If fiinding appro��ed, ���ill remo�•e from budget.) �
o $ 20,000— Golf Course Lightning Detection S}�stem
o $ 17,863 —Golf Course Eqtiipment
o $ 6,419 - Golf Course lease (elisting, must fund)
o $ 20,000—Grounds Zero-Degree Mo�ver
o $10,000— Grounds 20' Trailer (current unit is unsafe and needs replacement)
o $ 78,000 - Mini escavator (attempting to find a used model)
o $ 9�,000 —Elementar}� School - Phones (This �cork ma}' be accomplished ���ith
fimds from the current General Go�•ernment budget. Funds �`-ere allocated for
carpeting and re���iring at McGee, but the Board of Education paid for those
reno��ations ��ith its budget surplus. If so, this ma}� be remo��ed from the budget,
or reallocated to another need, stich as replacement of special education vans.)
Fleet Administrator Jim Simons �cas consulted and agreed to reduce the mini ehca��ator
budget amount to $50,000 and the flatbed budget amount to $45,000.
MOTIONS:
Mr. Richards moved to approve the adjusted General Government Capital List totaling
$790,782.
Seconded by Mr. Paradis.
Vote being 6-0. (MOTION CARRIED)
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Mr. Paradis moved to delete the Charter Revision Commission appropriation, as there is no
Commission at this time.
Seconded by Mr. Holmes.
Vote being 6-0. (MOTION CARRIED)
Mr. Paradis mo��ed to shift $27,716 (Insurance) and $5,400 (Refiise disposal) from Golf
Course Operations to To�tin-�vide Operations.
Seconded by Mr. Holmes.
Mr. Paradis stated that the Insurance and Refiise disposal charged to the Golf Course should
be mo��ed to To��-n-�vide Operations, or all departments should be char�ed for internal uses.
To���n Manager Healy stated that per the Ordinance, Timberlin is required to set rates to
match etipenses and these costs are part of its elpenses. Finance Director Delaney� added
that Timberlin's operating e�penses are calculated differently than other departments due to
the large in��estment in equipment, the high cost of insurance and the le��el of revenue
generated at the course.
Those ��oting for: Mr. Guite, Mr. Holines, Mr. Loma��lio, Mr. Paraclis
Those ��oting aQainst: Mr. Bordonaro, Mr. Richards
Vote Being 4-2 (MOTION CARRIED)
Mr. Bordonaro moved to increase VNA re��enue by $100,000.
Seconded by Mr. Richards.
The Board of Finance discussed VNA's goal to increase census and �vhether the budget
should set a reasonable revenue goal for VNA to meet. Some Members questioned the
likelihood of VNA increasing revenue.
Those voting for: Mr. Bordonaro, Mr. Richards
Those voting against: Mr. Guite, Mr. Holmes, Mr. Lomaglio, Mr. Paradis
Vote being 2-4. (MOTION DEFEATED)
Board of Finance members discussed fiirther changes to the General Go��ernment Budget
(non-binding stra�v��ote):
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Mr. Bordonaro—Recommends a$200,000 - $300,000 reduction. General Go��ernment has
the option to increase VNA revenue by $100,000.
Mr. Holmes—Does not propose to reduce the proposed increase of 8%.
Mr. Paradis—already provided sug�ested reductions in the motions above.
Mr. Richards— Recommends a$1,�L00,000 reduction to a 3.5% increase.
The parties scheduled another meeting for Tuesday, March 19, 2019 at 6:00 p.m.
2. Possible Vote to Send Budget to Annual Budget Hearing
a. Move to send the Board of Education budget of$ to the
Annual Budget Hearing.
b. Move to send the General Government budget of$ to the
Annual Budget Hearing.
c. Mo��e to send the Berlin Water Control budget of$5,69�,060 to the Annual Budget
Hearing.
Mr. Paradis mo��ed to send the Berlin Water Control budget of$5,69�,060 to the
Annual Budget Hearing.
Seconded by Mr. Holmes.
Vote being 6-0. (MOTION CARRIED).
E. ADJOURNMENT
Mr. Holmes moved to adjourn at 9:38 p.m.
Seconded by Mr. Paradis.
Vote being 6-0. (MOTION CARRIED)
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