Meeting of the Lincoln Finance Committee
May 1, 2008
Lincoln Finance Committee
Present: P. Braun, S. Haber, J. Koenig, L. Sander, R. Steinbrook (chair)
Absent: M. Hartman, E. Shorb.
Minutes submitted by: R. Steinbrook
The meeting was called to order at 7:30 pm in the selectman's office at Lincoln Town Hall.
The chair welcomed two new members--Peter Braun and Laura Sander.
The committee met with Tim Higgins, Town Administrator, and Colleen Wilkins, Town Finance Director. The status of GASB 45 planning was reviewed. According to the March 2008 final actuary report of the Angell Pension Group, the annual required contribution to fully fund the GASB liability is projected at $6,242,251. The current pay-as-you-go cost is $1,262,390 and the annual increase to fully fund the liability is projected at $4,979,861. Lincoln's liability appears to be high relative to comparable communities because of the size of the school staff including the Hanscom campus and a younger age distribution of retirees. Management strategies include adopting Section 18, that would make Medicare the primary payer for retiree health care, evaluating the appropriate discount rate to use in
projecting the liability, seeking funds from the Hanscom contract for the portion of the liability related to the Hanscom campus (about one-third of the total), and seeking funds from the Water Department for its share of the liability. Liability must be reported on the financial statements for FY '09, (prepared in the fall of 2010). Following discussion, the committee agreed to discuss GASB 45 again in the fall of 2008, with a view toward determining an initial set-aside of monies as part of the FY '10 budget, that will go before Town Meeting in March 2009.
The committee considered reserve fund transfers. By votes of 5-0, the committee approved:
--A reserve fund transfer of $9,000 for the increased cost of heating oil and electricity for Town Offices and Bemis Hall.
--A reserve fund transfer of $38,804 for police overtime related to medical leaves and investigations and an incorrect calculation for the FY '08 budget, that omitted a custodian's salary from the final figure for the salaries and wages portion of the budget. This calculation has already been corrected for FY '09.
--A reserve fund transfer of $10,000 for heating oil and electricity for the library.
Following the transfers, the reserve fund balance is $359,869.
A proposed reserve fund transfer of $163,495.47 to fund the snow and ice expense budget will be considered in June.
By a vote of 5-0, the committee recommended that the Board of Selectman provide the Town Finance Director with the ability, consistent with the Municipal Relief Act, to transfer funds between accounts in closing out the FY '08 accounts.
The committee set liaison assignments through Town Meeting in March 2009:
P. Braun: LSRHS, Long-range planning process.
S. Haber: Library, Minuteman RHS, Water Department.
M. Hartman: Capital Planning Committee, At-Risk-Properties Committee (if reactivated).
J. Koenig: Community Preservation Committee, LSRHS.
L. Sander: Fin Com "model," GASB-45.
E. Shorb: Affordable Housing Trust, Lincoln Public Schools.
R. Steinbrook: Town.
The committee discussed the financial situation of LSRHS.
The committee will next meet on Thursday May 29, 2008. A meeting was also set for Thursday June 19, 2008.
The meeting was adjourned at 9:45 pm.
Addendum: The minutes of the meeting of 3-19-08 were approved by S. Haber, J. Koenig, R. Steinbrook, and M. Hartman (voting by e-mail).
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