 |
013fLincoln Finance Committee
February 27, 2007 Meeting
Present: P. Giese, M. Hartman (vice-chair), J. Koenig (at 8:30 pm), P. Phillipps, J. Robinson, R. Steinbrook (chair)
Absent: S. Haber
Minutes submitted by: R. Steinbrook
The meeting was called to order at 7:30 pm at Lincoln Town Hall.
Tim Higgins, Lincoln Town Administrator, Colleen Wilkins, Lincoln Finance Director, and Gary Taylor, Lincoln Board of Selectman met with the committee. There was a discussion of the accounting for the Stabilization Fund. At the FY '06 Town Meeting, it was voted (Article 30) to "appropriate and transfer the sum of $200,000 from the Stabilization Fund to reduce the principal and interest payments on debt previously authorized." At the FY '07 Town Meeting, it was voted (Article 44) to transfer $149,891.28 "from the Stabilization Fund balance to reduce the total amount to be raised from taxation under Article 7." On February 21, 2007, as part of the FY '06 audit, an accounting issue was discovered, the effect of which was that the $200,000 in stabilization funds for FY '06 had
been transferred to free cash and had not been applied as intended. The same accounting issue will recur in FY '07. Following a full discussion, including a consideration of the pros and cons of various alternatives, the committee reached a unanimous decision of how to resolve the problem and move forward.
The chair was instructed to work with the Town Administrator to draft a memo to the Finance Director, to be co-signed by the selectmen, that would instruct the Finance Director to lower taxes in FY '08 by the amount that taxes would have been lowered in FY '06 and FY '07 (i.e., $349,891.28) if the stabilization funds had been applied as intended rather than going to free cash. More specifically, when preparing the 2008 recap sheet, the Finance Director will be directed to adjust the "DE-1 form" to reflect this amount of "excess levy capacity."
This one-time "credit" will be reflected in the tax bills that are issued in the fall of 2007 and the spring of 2008 for FY '08. For a house with an average annual tax bill (about $11,000), the credit would be about $194. This approach has no affect on the FY '08 budget plan. No further action by Town Meeting is required.
The committee will review the facts and explain the remedy at the Board of Selectman's meeting on 3-5-07, at the annual budget hearing on 3-15-07, and at Town Meeting. Starting in the fall of 2007, the committee will also use its financial planning model as an accounting check and balance.
Tim Higgins presented five reserve fund transfer requests from the Town, all of which were approved by a unanimous vote. The requests were $4,500 for a veterans claim, $13,800 for communications expense related to unanticipated repairs of the public safety emergency radio system hardware, $47,000 to replace "head-end" radio system equipment at the public safety building which is no longer considered reliable, $8,200 to increase the Town Clerk's scheduled hours from 30 to 40 per week, effective January 1, 2007, and $15,000 for police expenses to cover the costs of installing an electronic recording device for the jail cell monitoring equipment. As of the end of February, the remaining balance in the FY "07 reserve fund is $341,499.36.
The chair noted that between the $47,000 for the radio system equipment from the FY '07 reserve fund and the FY '08 "cash" capital budget of $690,808, a total of $737,808 will have been expended for capital items, thus meeting various needs. This compares to a typical capital expenditure in recent years of about $550,000. When considering the FY '09 budget, the committee may find it appropriate to set a smaller "cash" capital budget.
The committee scheduled meetings for Thursday March 15, 2007 at 8:30 pm (following the previously scheduled Annual Budget Hearing) and for Thursday April 12, 2007 at 7:30 pm.
The committee discussed the proposed Master Plan Consultant and the Warrant Article for Town Meeting that seeks an appropriation for the consultant of $95,000. Tim Higgins provided an overview of the reasons for the request. On behalf of the Master Plan Committee, Ken Hurd will be invited to the attend the Finance Committee meeting on March 15 at 8:30 pm to review the scope of the work and the proposed budget for the consultant. After this presentation, the committee will decide whether or not to endorse the article.
The committee discussed planning for the annual budget hearing and for Town Meeting. The chair and the vice-chair will prepare the presentations.
The meeting was adjourned at 9:45 pm.
| |
