MINUTES OF THE CUMBERLAND TOWN COUNCIL

SECOND BUDGET HEARING AND VOTE FOR FISCAL YEAR 2007-2008

MONDAY, JUNE 9, 2008 AT 7:30P.M.

CUMBERLAND TOWN HALL

EVERETT “MOE” BONNER, JR. COUNCIL CHAMBERS

45 BROAD STREET, CUMBERLAND

OPEN SESSION

 

The meeting was called to order at 7:35 p.m. by Council President Higgins.       

 

The meeting opened with the pledge of allegiance to the flag.   

 

MEMBERS PRESENT:

 

Council President Higgins, Councilors Mutter, Ackerman, Lemois, Morris and Kirkpatrick    

 

Also present Mayor Daniel J. McKee, Thomas E. Hefner, Town Solicitor, Thomas Bruce, Finance Director, and Sandra M. Giovanelli, Town Clerk 

 

MEMBERS PRESENT:            

 

OLD BUSINESS

 

A.  ORDINANCES FOR PUBLIC HEARING/VOTE:

 

1.  #08-16 – An Ordinance Establishing the Operating Budget for the Town of Cumberland for the Fiscal Year 2008-2009 

 

Council President Higgins explained that they have completed the public hearings so there will not be any comments from the public, other than the School Department or the Administration.  He stated that he would entertain any amendments or motions.

 

Councilor Mutter explained that after speaking to the Finance Director he had emailed the Council members a new tax levy sheet.  He further explained that the big change is the collection rate from 43.34 percent to 44 percent.  He added that there is no legislation that guides when they are setting the budget what that collection rate should be but there is legislation at the time that the levy is being set that mandates you not use a collection rate any greater than 1 percent less than the previous year.  He pointed out that in 2006 they collected 44 percent and last year they collected 44.34 percent and they are on target this year to at least reach that number and some suggest that they will be running higher than that. 

 

Finance Director, Tom Bruce, stated that in terms of the budgeted 2008 tax bill that went out in the beginning of May the Town has collected as of today 92.78 percent of the budget compared to this time last year they were at 91.57.  He added that the percent based upon the new tax levy this past May, a 1.4, is about $300,000.  He pointed out that it is not to assume that at the end of August after the 60 day period on collections that they will be ahead by 1.4 percent.  Mr. Bruce stated that to go to 44 percent he doesn’t think is too much risk to take on. 

 

Councilor Mutter stated that when they use 44 percent collection rate they stay under the State Law 3050, they don’t need an override of the State cap and stay within the Scully tax cap.  He added that the proposed tax rate would be 12.95 based on the 44 percent collection rate.  He also asked Mr. Bruce to provide some information on debt service basically showing a 9 cent decrease based on certain projections.

 

Councilor Morris asked if there was a reason why they were using a 44.00 percent when they could have used a 44.34 percent. 

 

Councilor Mutter explained that he felt that 44.00 percent was within the intent of the original ordinance which they use for the levy.  He further explained that the rate could be changed which will allow them some flexibility.

 

Council President Higgins asked what the difference between the revenue generated under the 44.00 percent versus the 44.34 percent.  He stated the reason for his question is that he has some concerns of liabilities that they could be incurring without having any money and if he knew there was an opportunity to have a better year than expected would certainly make him feel better.

 

Councilor Mutter replied that at the 44.34 percent collection rate $23,499,017 so the cushion amount would be about $182,000.

 

Councilor Mutter asked that Mr. Bruce could state for the record whether his numbers are accurate as he represented them.

 

Mr. Bruce stated that the numbers as Councilor Mutter has represented them are accurate.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR KIRKPATRICK TO AMEND THE OPERATING BUDGET UNDER GENERAL REVENUE, LINE ITEM PROPERTY TAXES FROM $50,533,698 TO $51,118,827.  VOTE 7.0.

 

Councilor Mutter stated that ordinance #04-27A, the General Fund Balance, which was subsequently amended at a later date had a provision inside that ordinance for Vehicle Replacement.  He added that there is currently a million dollars in that fund and when they created that legislation those dollars are restricted for purchases or leases of vehicles.  He also believed that the legislation requires that the money be replaced in the year that it is taken out which doesn’t make a lot of sense.  He asked what the line item under Highway for Vehicle Lease for $100,109 is. 

 

Mr. Bruce explained that over the past three or four years Highway Department has had a replacement of almost their entire fleet and the mainstay of that payment is medium sized dump trucks that they have leased over a period of 5 years.

 

Councilor Mutter asked if that is a yearly payment.

 

Mr. Bruce replied that was correct.

 

Councilor Mutter stated that the amount was estimated at $68,000 in 2007-2008 so he asked why it was going up to $100,109.

 

Mr. Bruce replied that it was under the current year capital account and funded one of those leases so it is being restored back to the Department in its correct appropriation.

 

Councilor Mutter asked if next year there would be another $100,000 payment.

 

Mr. Bruce replied that was correct.

 

Councilor Mutter asked how long would that continue.

 

Mr. Bruce explained that this is a mixture of a lease term and he believed that they had two more years at that level and then they drop off.

 

Councilor Mutter stated that they can leave that in the expense side but they can fund that potentially out of the million dollars that they are holding for Vehicle Replacement Fund and they could add on the revenue side an appropriation from that restricted account for vehicles.  He asked Mr. Bruce to explain how this would affect the Fund Balance and their rating.

 

Mr. Bruce explained that Moody’s Investment Service and Standard and Poore will not really take a look at them until they receive the audit, especially on Moody’s because they want to get rid of the negative credit outlook.  He added that this issue doesn’t come up in that and if they ask for the budget and asked if they are using a surplus in the new year’s budget which he will explain that it is restricted to the uses of vehicle that has its own terms and its own ordinances.  He concluded that $100,000 is very manageable.

 

Councilor Morris stated that this discussion led her to look at the Police Budget where there is an allocation of $78,000 for this year and they just did this within the last year.  She asked if they expect to spend another $78,000 this year.

 

Mr. Bruce replied that this $78,000 is the first payment of the cars they purchased because they structured it so that the first payment didn’t occur until the proposed budget year.

 

Councilor Morris asked if this amount could also come out of that vehicle replacement account.

 

Mr. Bruce replied that it could come out of that account but he doesn’t think it is a good idea to use any more than the $100,109 discussed because to add to that amount would be too much to add to their plate for next year.  He concluded that this reserve gained a lot of notoriety with the rating agency when they raised their rating to A3 that they had lost in 2001 when they had somewhat of crisis.

 

Councilor Kirkpatrick reads into the record a portion of the ordinance relating to when the money would need to be replenished.  He read Section 3 from Ordinance 04-27A, “The general fund shall include a reserve to fund balance for capital outlay. This reserve fund must be maintained at an amount of $1,000,000.00 and is to be utilized for the purchase or lease acquisition of town vehicles. The acquisition of assets other than vehicles is not an eligible use of this reserve. If the reserve is utilized, it must be replenished within the next annual period to the original amount of $1,000,000.00 through town council approval of either a formal budget appropriation or through an additional reserve of undesignated fund balance.”

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS  TO AMEND THE OPERATING BUDGET UNDER GENERAL REVENUE BY ADDING A LINE ITEM ENTITLED Appropriation  FROM RESTRICTED VEHICLE REPLACEMENT FUND IN THE AMOUNT OF $100,000.  VOTE 7.0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER GENERAL REVENUE BY INCREASING THE TOTAL GENERAL REVENUE FROM $53,833,313 TO $54,518,442.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR KIRKPATRICK TO AMEND THE OPERATING BUDGET UNDER TOTAL REVENUE FROM $77,277,100 TO $77,962,229.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGER UNDER EXPENDITURES, PUBLIC SAFETY’S LINE ITEM FOR RESCUE SERVICE FROM $1,349,674 TO $1,351,674.  VOTE 7/0.

 

Councilor Morris explained that Department asked for $10,000 but the Director stated that only he needed was another $2,000.  

 

Councilor President Higgins clarified that this was for some type of training.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER EXPENSES, TOTAL PUBLIC SAFETY FROM $5,471,167 TO $5,473,167.  VOTE 7/0. 

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGET UNDER OTHER DEPARTMENT TRANSFER TO SEWER FROM $132,480 TO $0.  VOTE 7/0.

 

Councilor Mutter explained that this is just a policy decision that the Council needs to concern.  He added that paying the Sewer Fund has been a practice for many years and there has really been a lot money spent to support that fund but they have made appropriations to this fund and it has lost money many times.  He stated that it is his belief that it is time that this fund be self-sufficient.  He mentioned that he is a member of that fund receiving the service and doesn’t believe that the people who do not receive that service should be paying for his service.  He concluded that this is a difficult issue and are going to need to be worked at but he doesn’t see a reason for them to fund this at the detriment of others. 

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR KIRKPATRICK TO AMEND THE OPERATING BUDGET UNDER OTHER DEPARTMENTS TOTAL FROM $1,566,663 TO $1,434,183.  VOTE 7/0.     

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR KIRKPATRICK TO AMEND THE OPERATING BUDGET UNDER OTHER FINANCIAL EXPENSES FROM $1,979,940 TO $1,613,229.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGET UNDER DEBT SERVICE SCHOOL $3,657,321 TO $3,681,413.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE    TO AMEND THE OPERATING BUDGET UNDER FINANCIAL EXPENSES BY ADDING A LINE ITEM ENTITLED, “TOWN MASTER LEASE” WITH $213,987 APPROPRIATION.  VOTE 7/0.

 

Councilor Mutter asked if he could ask Mr. Prignano, the School Department’s Business Manager a question.

 

Council President Higgins replied yes.

 

Councilor Mutter stated that they have $111,600 that is currently budgeted and want to roll the $100,000 that they have because their intent last year was to have $211,000 to be ear marked for B.F. Norton.  He asked Mr. Prignano if he preferred to have it separated or if there would be a problem if he combined it to School Capital Improvement Leases with the appropriation of $211,660.

 

Mr. Prignano replied that it would be fine to combine them.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ACKERMAN TO AMEND THE OPERATING BUDGET UNDER OTHER FINANCIAL EXPENSES BY REMOVING LINE ITEM, “SCHOOL CAPITAL IMPROVEMENT/LEASES”.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGET UNDER SCHOOL DEPARTMENT EXPENDITURES BY ADDING A LINE ITEM THAT READS, “SCHOOL CAPITAL IMPROVEMENT/LEASES” AND APPROPRIATE THE SUM OF $211,600.  VOTE 7/0.             

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGET UNDER SCHOOL DEPARTMENT BY STRIKING OUT “TOWN CONTRIBUTION CAPITAL IMPROVEMENT” AND IT APPROPRIATION OF $100,000.  VOTE 7/0. 

 

Councilor Mutter requested a recess to confirm his numbers with Mr. Bruce before proceeding.

 

Council President Higgins announced that they would be recessing.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER OTHER FINANCIAL EXPENSES, FRINGE BENEFITS FROM $4,598,530 TO $4,781,171.  VOTE 7/0.

 

Councilor Mutter explained that this amendment is to restore the difference in the pension and there is a slight decrease in the health insurance.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE OPERATING BUDGET UNDER OTHER FINANCIAL EXPENSES TOTAL FROM $10,235,791 TO $10,289,800.  VOTE 7/0.       

    

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO

AMEND THE TOTAL TOWN FROM $24,210,733 TO $24,134,262.  VOTE 7/0.       

 

Councilor Mutter apologized for being less than what he needed to be at Monday night’s meeting.  He adds that he thinks that the School Department gave a great deal of effort to educate them on what they do and some the issues they encounter.  He concluded that he imagined that his comment did not raise them up and he apologized again. 

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER SCHOOL DEPARTMENT  BY ADDING A LINE ITEM ENTITLED, “SCHOOL COMMUNICATION/SYSTEMS/ASSESSMENT DATABASE/SCHOOL IMPROVEMENT” WITH A $50,000 APPROPRIATION.  VOTE 7/0.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER SCHOOL DEPARTMENT BY INCREASING TOWN CONTRIBUTIONS FROM $35,658,031 TO $36,258,031.  VOTE 7/0.

 

Councilor Morris stated that she believed that the Town Council, School Committee and School Department have done a good job in the last 17 months trying to communicate with each other.  She also stated to Dr. Morelle that she would have liked to have given them whole $1.2 million but she believes that they need to continue to keep the lines of communication open.

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE TO AMEND THE OPERATING BUDGET UNDER SCHOOL DEPARTMENT BY INCREASING TOTAL SCHOOL DEPARTMENT FROM $53,066,367 TO $53,827,967.  VOTE 7/0.

 

Councilor Mutter clarified that the action of the total dollar amount based on the levy is about 12.95 understanding that the rate could be less if collection rates are better.  

 

Dr. Morelle expressed an immense amount of gratitude on behalf of the School Department, the administration and students for their patience and time into this discussion which is such an incredible investment in the community.  She stated that this is not all the money they were looking for but is definitely a budget they can work with.   

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR MORRIS TO AMEND THE TOTAL GENERAL FUND EXPENSES LINE FROM $77,277,100 TO $77,962,229.  VOTE 7/0. 

 

Councilor Mutter mentioned that he appreciated the entire Council’s work and attendance on this budget and gave a special appreciation to Councilors Albuquerque and Kirkpatrick who gave a lot of effort behind the scenes with very little recognition for their work and time.

 

Mayor McKee recognized along with the Town Council, School Department and Finance Sub-Committee as well as the Department heads whose budgets are level funded.  He commented on how the School Department has hit a wall due to the lack of State Aid as a result of the school’s funding formula is out of sorts.  He concluded by stating that shortly they will have up on their website a presentation he came up with to demonstrate how the State’s School Funding Formula is out of sorts that is jeopardizing the School Department as well as the General Fund.   

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE AND IT IS UNANIMOUSLY VOTED TO APPROVE AS AMENDED #08-16 BY A ROLL CALL VOTE.  VOTE 7/0.

 

2.  #08-17 – An Ordinance Establishing the Water Department Budget for the Fiscal Year 2008 – 2009

 

Council President Higgins explained that they have only had 1 public hearing on this and the Administration has requested a block of time to discuss this budget.

 

Mayor McKee suggested tabling it to the date that they have their second vote.

 

MOTION BY COUNCILOR ALBUQUERQUE, SECONDED BY COUNCILOR ACKERMAN AND IT IS UNANIMOUSLY VOTED TO TABLE TO JUNE 11, 2008.  VOTE 7/0.

 

3.  #08-18 – An Ordinance Establishing the Sewer Department Budget for the Fiscal Year 2008 – 2009  

 

MOTION BY COUNCILOR ALBUQUERQUE, SECONDED BY COUNCILOR ACKERMAN AND IT IS UNANIMOUSLY VOTED TO TABLE TO JUNE 11, 2008.  VOTE 7/0.

 

 

4.      #08-19 – An Ordinance Establishing the Recreation Department Budget for the Fiscal Year 2008 – 2009

 

Council President Higgins explained that they have only had 1 public hearing and he doesn’t know of any reason why they couldn’t have a public hearing and a vote this evening.

 

Public Hearing opened at 9:44pm

 

Public Hearing closed at 9:45m

 

MOTION BY COUNCILOR MUTTER, SECONDED BY COUNCILOR ALBUQUERQUE AND IT IS UNANIMOUSLY VOTED TO APPROVE #08-19 BY A ROLL CALL VOTE.  VOTE 7/0.

 

NEW BUSINESS

 

A.  RESOLUTIONS:

 

1.   R-08-69 – A Resolution an Increase to the Approved Amount of the Existing Contract with Ads Construction, Inc. of East Providence, Rhode Island in an amount not to exceed $19,093 for General Services related to the Renovation and Improvements at the Cumberland Hill and Ashton Elementary Schools

 

MOTION BY COUNCILOR KIRKPATRICK, SECONDED BY COUNCILOR ACKERMAN AND IT IS UNANIMOUSLY VOTED TO APPROVE.  VOTE 7/0.

 

2.  R-08-70 – A Resolution an Increase to the Approved Amount of the Existing Contract with the Cheviot Corporation of North Providence, Rhode Island in an amount not to exceed $32,068 for a Metal Panel System for the Bridge as a portion of Part II of the CHS2010 Phase III Project at Cumberland High School

 

MOTION BY COUNCILOR ALBUQUERQUE, SECONDED BY COUNCILOR ACKERMAN AND IT IS UNANIMOUSLY VOTED TO APPROVE.  VOTE 7/0.

 

ADJOURNMENT

 

MOTION BY COUNCILOR  KIRKPATRICK, SECONDED BY COUNCILOR ALBUQUERQUE AND IT IS UNANIMOUSLY VOTED TO ADJOURN AT 9:47PM.  VOTE.  VOTE 7/0.

 

 

________________________________________

Sandra M. Giovanelli, Town Clerk

 

 

THE DVD AND MINUTES OF THE ENTIRE MEETING IS AVAILABLE AT THE EDWARD J. HAYDEN LIBRARY