Tuesday, September 7, 2010

Live reporting - capital plan to closing

Head's up that we are looking to do a capital plan earlier than we have done before
the same five or six departments put in the capital requests, you should be able to do the due diligence

The staff will start working in October on the 2012 budget
Other than some increases in benefits, etc. we won't be adding folks,
Pension usually comes in about March, we would like to make decisions earlier than later
State potential shortfall of 2-3 Billion for next year, if that is true, it can't be good for us
Because we have lived with lots of State Aid, that hurts us more when the cuts come
It puts us at a greater risk for Fiscal 2012. Jim Vallee has done a great job for us, but if the state doesn't have money that won't help us.

Don't give me what you want, give me what you have now and any known increases
For example, an energy increase may be possible with a contract coming due next year.

The vote on the sales taxes could cut the overall State income in half and that would trickle down to us.
Let's look at a zero based budget, what are we actually required to provide by statue

The guts of government that cost the least are the ones you have to have, the quality of life is created by the other departments that do help us and cost the money.
It gets and will be very difficult. We have lost one of every ten jobs on the municipal side since I have been here. I don't see that changing.

The big piece of the puzzle is the schools. They have been working hard to do what they can with they have.
Maybe in a perfect world we have no net new revenue so we will struggle. We have done well with what we have. People are getting a great bang for the bucks they do spend.

When can we expect free cash to be certified?
Probably in November.

It is our policy to use free cash to fund the capital plan.
It is not free and it is not cash. The funds left over from the previous fiscal year are turned back and revenues in excess of anticipated. When it is all mixed together, it goes to the State, they then certify. Traditionally we have gotten around 2 million and we are a 100 million dollar business. We want to have some left over. It is better planning to have free cash than to be short. We are conservative in estimating revenues.
Usually set aside a half million for snow/ice right away. We are building that account up over time but we are not there yet. Depending upon the weather, we see what we have left. The capital plan goes up and down depending upon what we have left in free cash.

We can't use free cash to balance the operating budget. Free cash is one time and can be used for capital not operations.

It is confusing to some of the citizens but whether we have 40 or 45 police officers, they still need cruisers and cruisers do wear out over time and need to be replaced.

There are two items of concern: one the roll back on the sales tax and one the roll back of the liquor tax. The last time the roll back the income tax got 40 something percent of the vote.

Any further progress on regionalization?
Nothing yet, we have feelers out. It is a piece of the puzzle. We are doing the library and recreation. Fiscal stress is the mother of invention. The more stress, the more people may be ready to dance. There are so many pieces to the puzzle here in the commonwealth.

Hope to have a contract with the architect for the high school project completed next week. Still targeting next November for the voters to have their say on the renovations.

The Governor did sign off on the petition for our charter questions this November. We will have two questions (one with regard to the technical items) and two to make the treasurer/collector an appointed position. (The questions will be posted to Franklin Matters and discussed further as we get closer to November.)

Finance Committee would move to a three year term and be staggered to get into it. Some would take one year, some two year, and some three year terms to get it going.

It is important that the stabilization fund is not used for operations. Our overall balance is down 5 Million over the last several years. A reduction in rating now is about a half a percent on the bond rating.

We look at all the options. What is coming off, what will come on, what will it look like so we can explain to the citizens what the school issue would look like before the vote.

We upgraded out bond back in 2002. S&P has us at the same rating, Moody's dropped us.

New business
Oct 23 - Assoc of Finance Committee meeting at Tri-County

Cameron - re: funding just received by the School Committee, some of which is being saved and some is being used.
Nutting - If it came five months ago, it would have been a lot easier, three months later it would have been too late. They voted to use part of it and save the remainder for FY 2012. Any questions should be directed to the School Administration and School Committee.

The money was directed for teacher salary and benefits to be spent by 2012.

Motion to adjourn, passed 10-0

Franklin, MA

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