Littleton, New Hampshire

Approved Work Session Minutes Jan 9, 2008

LITTLETON BOARD OF SELECTMEN
WORK SESSION
JANUARY 9, 2008
TOWN OFFICES, CONFERENCE ROOM
3:00 PM

Present: Chairman Burton Ingerson, Vice Chairman Eddy Moore, Selectman Brien Ward, Town Manager Charles Connell, Tony Ilacqua, Chief Paul Smith, Steve Kelley, Art Tighe, Sharon Craigie, The Caledonian and The Courier, Ceil Stubbings, Executive Secretary

Pre-Meeting discussion:

Town Manager Chuck Connell advised the Board that Karen Noyes had asked him to ask for the Board of Selectmen's permission to make the first payment on the new Highway truck. By making the payment now it would save on interest costs. Selectman Brien Ward asked if there was a prepayment penalty. Chuck responded by saying he did not believe there is a penalty. Selectman Ward advised Chuck to check on the possibility of a prepayment penalty before the Board approves the payment.

Town Manager Chuck Connell stated that the DOT moved the Redington Street Bridge into 2010. Chuck further stated that the DOT is encouraging us to continue with the planning process. Chuck further advised that no monies are available for construction until 2009. Selectman Brien Ward asked if the DOT moved a whole series of things back. Chuck said he did not know what else they have moved back.

Chairman Burt Ingerson called the work session to order at 3:07 PM. Town Manager Chuck Connell began the meeting by saying the Board of Selectmen had given him and the Department Heads the task to bring the proposed budget in below the $5.2 million. Chuck explained that the copy of the budget in front of everyone sits at $5.3 million. Chuck also said that in his mind the Town is under budget in areas that they should not be. To cut the budget we cut temporary positions, supplies, services, training and other areas that could put us in a mode where we may be asking for trouble. Chuck stated that he did as the Board of Selectmen suggested. He put a sheet out to all of the departments based on the 2% figure. There are some departments that cannot be cut at all. For example, some of the areas that could not be cut include insurances, cemeteries, bridges and streetlights. Chuck stated that he was proud to say that every department took the direction in a very cooperative spirit. They made the changes they thought they could live with. Still we are under-budgeted and we will have a lot of catch up to do in 2009. Chuck went on to say that he has serious concerns about the operating budget. Steve Kelley asked Chuck if is it realistic to defer projects. Chuck advised that we are not replenishing supplies. We will have to replace these supplies in 2009. Chuck also said the cuts are going to effect services.

Town Manager Chuck Connell said that the Fire Department Chief feels there is enough foam for this year, but next year it will have to be replaced. Steve Kelley said that at the last meeting we had a tax rate projection sheet. Steve asked if they had more current numbers. Chuck said no we do not. Chuck said that he does not know what the county tax is going to be in 2008. Chuck further stated that he also does not know what the final school budget is going to be. This meeting is to discuss the warrant articles. Once this is done he can set up amortization schedules for the bonding. Town Manager Chuck Connell said the projections that you have in front of you are based on the tax rate today. Everything else you have is based on current year numbers. Steve Kelley said he understood that. Selectman Brien Ward said that you should try to do a conservative estimate as to what your tax base is going to be. Town Manager Chuck Connell said that if we were to do $10 million in bonds that is $1.25 on the tax rate. Chuck advised Steve Kelley that the Redington Street Bridge has been delayed to 2010. Steve responded by saying that even so the expense is still going to be there. Steve said we a significant issue, we have to get involved in some projects that will impact our tax rate. Chuck asked what projects Steve was referring to. Steve said he was referring to the bridge, the sidewalks and the schools. Chuck asked Steve if he had numbers for the schools projects. Steve said he did have the numbers. Chuck said that we have some indications as to what will be next year and the year after. Steve said that from his perspective he is going to look at everything through jaundiced eyes due to events over the last few years. Steve further said that he means no offense to Chuck, he has been doing an excellent job. Chuck said that you could not do so at the expense of the operating budget. No matter when we do it, we are looking at a significant tax increase. Chuck asked Steve if he was taking into account the bonds that would be paid off. Steve said that he was taking them into consideration. Chuck asked Steve what he would do when the legislature changes the tax rate. Steve they said we should have planned for it. Chuck said that the Town he worked for were hit with $6 million. Steve said that in rough figures for all of the issues and high school, we could be talking $4.00 on the tax rate this year. Statewide property tax is .29 cents.

Selectman Brien Ward said that Chad, Carol and Karen did some work on the county tax rate. Based on a $50 million project the counties project has gone from $19 million to $32 million. Chad's analysis as to what the impact was going to be was off by $1. His methodology was not far off. That results in $550,000 additional tax dollars in one year. Steve Kelley said that the $550,000 is .69 cents.

Town Manager Chuck Connell asked Steve how long would the school bond be. Steve said that he was not sure. Steve said that it could be another $1.25. Selectman Brien Ward asked if he was talking about the construction project. Selectman Brien Ward said that what they are proposing is a lot more than $10 million. Steve said yes it is, but that is our share. Selectman Ward went on to say they have three projects. Steve said the Vocational Project is $4.83 million but could almost end up being revenue neutral. Because of the way it is funded. 75% funded. The other 25% that we are responsible for can get be reimbursed by some conventional method over time. The 7th & 8th grades would be .07 cents on the tax rate.

Steve Kelley explained the cost associated with the school's three projects. Steve thinks we could collect $75,000 each year. Chuck when does this take place. Brien stated it would start in 2009. Chuck asked Steve what his crystal ball said for the school in 2008. Selectman Brien Ward said the number from Milt Bratz is that they are estimating $1.25. They are still trying to reduce it. Chuck said that it is a million dollar increase. Chuck said that still leaves us with $5.4 plus $10 million but that would not start until 2009.

Selectman Brien Ward asked how much is the sewer fee going to go up. Chuck said that Karen Noyes projects it would go up to $50,000. Again it is a ballpark figure. Chuck we have not dealt with revenues in any of these items. Chuck believes it would be $2.40 increase. That is before the bonding and it will hit next year. Selectman Brien Ward then asked about the sidewalk district and if there was any money in there. Chuck said that whether it is still there or not, it would not have much impact. Steve Kelley said we are covering the county, the school, and the operating budget. Selectman Brien Ward stated that the Police Department facility would not cost us anything until 2009. This led into a short discussion regarding the new proposed police facility.

Selectman Brien Ward asked Town Manager Chuck Connell if he was estimating the tax increase would be another $2.50. Chuck said yes $2.50 on an $8 million tax base.

Chuck then asked if there were are any questions on the proposed budget. A member of the budget committee asked about sewer fees asked what does the average user pay now? Chuck responded by stating the average sewer bill will go up 22%. So it's going up $100. Chuck said they took the gross expenses and the numbers of users so the users were only counted once. Selectman Brien Ward said they are not included in the tax expense. Selectman Brien Ward said he thinks Karen would have taken them out. Chuck said he does not want anyone to leave here thinking the tax bills are going up too. Chuck said that Karen would be the better one to answer that question. With all of that said the purpose of this meeting is the budget, which is in front of you today. Selectman Brien Ward said he wants the chance to review it and then come back and discuss it tomorrow. Selectman Brien Ward then advised Chuck that it would give him a chance to get the Warrant Articles done. Town Manager Chuck Connell advised Brien that they we would not be ready by tomorrow. We will be getting ready for the bond hearing tomorrow night.

Selectman Brien Ward asked Chuck for his best professional estimate. Chuck said they would address that tomorrow. Chairman Burt Ingerson asked if we are asking for an impossible task. Chuck Connell said he does not know where he is on the needs projection for the next ten years. Selectman Brien Ward said they want to know that. They want to know what those expenditures are. Selectman Ward then asked why would they be reviewing the default budget. Selectman Brien Ward then said he reviewed all of the budgets and he found some items that he had questions on. Town Manager Chuck Connell said if the 2008 budget does not pass we then go to the default budget. When you review the default budget, you will find many changes. Selectman Brien Ward noted that Karen Noyes was not there so they should wait until tomorrow.

Selectman Ward suggested a continuation of a properly posted meeting for tomorrow at 3:00 PM. Brien went on to say the budget has to be accurate. Steve Kelley said nobody has really taken it into task to check it. Brien gave an example of an item on page 40 on the new budget. We budgeted for part time positions it should be a default number. Last years numbers are part of the default budget. Chuck said that they are commitments that were made. Selectman Brien Ward said that there is no contractual responsibility to part time help. The Board of Selectmen approved the Fire Chief to hire temporary part time help. Selectman Ward went on to say that they had requested the Chief to hire three part time people to reduce the overtime and it never happened. The over time was never reduced. That was never part of the budget. Selectman Brien Ward said that you could not put that into the budget when it never occurred. One of the budget committee members said the budget should be tied to people who were here the previous year. Those salaries should be in the default budget. Town Manager Chuck Connell agreed and said that it is the same for other commitments.

Town Manager Chuck Connell explained that if the cost of gas goes up in a year like it did this year, then the budget for gas should increase based on the usage of gas. Selectman Ward disagreed and said that it would be wrong to increase the budget amount. Chuck Connell then asked Selectman Ward if he wanted to stop driving the trucks in August. Another budget committee member asked Chuck that when they asked for the 2% cut did he go to each of the department heads. Chuck advised him that he did and the cut was actually 2.25 %. Chuck said he shook his head at some of the things the department head cut but did went along with their wishes.

Selectman Brien Ward said he was missing one number. Brien then asked if there is still another $1.4 million of tax expense that does not show up. Art Tighe said that if you look at this from a level of accuracy budgeting that is bad. It reflects that we over expended. Steve Kelley said that if you go back to 2006 we had the same situation. Town Manager Chuck Connell said there is speculation in a budget. Steve said that if it is speculation then what happened. Selectman Brien Ward said that if you want to know where it went the sewer fees went down by $500,000.

Steve Kelley said he believed they should meet tomorrow at 3:00 PM to review the proposed and the default and to script the bond hearing. Selectman Brien Ward asked everyone if they thought a 12% tax increase would be acceptable to the community. Steve Kelley said that is where we stand at now. Selectman Brien Ward stated that last year it was 8%.

Steve Kelley told Paul Smith that he was glad he was in attendance. The next few things relate to Paul's department. Steve went on to say that the three main things people have asked him about are the SWAT Team, the dog and the school officer. Town Manager Chuck Connell asked if the budget committee does not want us to participate in the Special Operations Unit. Chuck asked them again if they felt we don't need to be involved in the SAU. Steve said the State police have four SWAT team members in Twin Mountain. There are approximately 25 in the state. They start with the home base scene and go from there. Chuck said his suggestion is if the budget committee wants to get rid of those line items we need to draft an article. Paul Smith said there are 14 SWAT Teams in the State of New Hampshire. Of those 14 one will not sign a memorandum of understanding with anyone else. We would be making a huge mistake. Paul Smith said the reality is the SWAT Team does not like to play in the sandbox. In Littleton you have 5 that are trained. You might have four at Troop. Art Tighe said the SWAT Teams did a good presentation but it should not be pay to play. Paul Smith said that he has already cut the 2% out of his budget. Chuck Connell said this is a longer-range issue. Steve Kelley said that he had made some calls to get a sense of what they do in other communities. 90% of crimes in Berlin were drug related. A discussion regarding the School Resource Officer ensued. Art Tighe asked if the public said yes to the School Resource Officer would we then have to ask in 2009 again to keep it. Chuck Connell said no you would not. Selectman Brien Ward said that what Chuck is proposing it would be a non-binding referendum. Paul Smith he has to advocate for the guys in his agencies. You are getting into operational issues and it takes so long to train these people. Paul explained the SRO for example. He has a two-page list of what an SRO does now. That is only a quarter of the work he does when he is in there along with the work in the summer. Paul Smith said this is the eleventh hour and he resents it. Chuck Connell said this is not something that should be brought up in the seven days we have left. We have done what you have asked us to do and now you want us to go back and make more cuts. Steve Kelley said if the school was that interested in it why don't they pay for it. Chuck said the school does not have the means. Steve Kelley brought up security. Chuck does not know anything about their security and that the SRO position is not security. There is a difference between security officer and law enforcement.

Art Tighe said the budget committee would be meeting with the school on the 17th. Art felt this issue should be discussed again. Art Tighe said these expenses total maybe $100,000. Art said he could not understand the $500,000 increase. He is afraid to ask the question about unions. Town Manager Chuck Connell said there is nothing we can do about the unions. Chuck said it would not change. There is nothing that can be done. The legal counsel has advised the Town to leave it be as is. Tony Ilacqua said maybe the union could reopen and negotiate the contract again. Chuck said he does not want to speak to Littleton unions. Chuck went on to say if you want to reopen negotiations you would have to be willing to give up even more. Steve Kelley said he believes the next negotiations need to be reduced back on benefits. Steve said that when you when look at the money involved, it is eating up available money. Other people in this area are not feeling these levels of increases. Selectman Brien Ward said that a $33,000 increase in one year for salaries is out of line. Paul Smith said that he is not a part of the union. Steve said that he is just bringing up ideas. He was just looking at how it would be received that the community would chip in also. Art asked if anyone understood where he was coming from. There is no accountability for the $533,000. Art said that he is frustrated with answer of we can't do anything about it. Town Manager Chuck Connell said we own it until 2010. Chuck further made the statement that this is not a good budget. This is not a safe budget. None of us feels good about this budget. Neither do any of the department heads. It is spilled milk and we have to live with it. Chuck said he does not want to open negotiations.

Chuck said the K-9 Unit is back on duty and healthy again. When it is time to re-negotiate it will be with the Board of Selectmen when it is done. Tony Ilacqua said that when the new contract starts he hopes that the department heads will have input. His budget is a mess by the labor part of it. His budget is bleeding. It is bleeding through the contract he has.

Chuck Connell then said that three of the department heads are here who had to make the budget cuts. No one held back, not one person said they would not do it. Selectmen Brien Ward said that no one ever said to the voters that the cost to the taxpayers was going to be $533,000. Chuck asked Brien if he was telling him that voters were ignorant. Selectmen Brien Ward said the voters are not ignorant they were not told the whole story.

Paul Smith said he could not comment on the union issue. To say you hate the union is not the way to go about it. The labor cost is not per hour for the union employee there are a bunch of factors to that. Paul said he does not want his budget to go up. There are a lot of different factors. Paul said that what he wanted to bring up has to do with tomorrow night. The Police Facility Study Committee want to ask for $144,000, which is the difference over the $1.75 million guaranteed price. Paul went on to say that the committee made cuts to the budget and one thing that did get cut was the fire suppression system. The sprinkler system is around $75,000. We are right next to the Fire Station so their suggestion would be so that the committee does not lose face with the public we could add the sprinkler on for a warrant article.

Paul Smith said the second thing he would like to request is that Janet Parker has requested to do a power point presentation for tomorrow night. Chairman Burt Ingerson said a power point presentation takes time. Chuck Connell said it saves time too. Selectman Brien Ward said he had no problem with it.

Chuck Connell asked Paul if there were other issues he would like to bring up. Paul said he had no more issues. Selectman Brien Ward asked Paul how much of the $1.75 million was not construction related. Chuck Connell stated that $248,000 was not construction related. Paul said that it is probably less than that now. It is related to architectural fees. Selectman Brien Ward said the school included their other costs. Steve Kelley asked if there are there moving costs. Paul said the moving costs are not $20,000.

Tony Ilacqua said that an article in the paper said there was a recommendation to close the transfer station for one day. Tony said the ramifications of closing the transfer station for one day would result in a net loss of $37,000 per year. Tony wanted to know was the article valid and is this being considered. Selectman Brien Ward does not remember the Board of Selectmen recommending this. Art Tighe said he would like to explain how this got there. Art said that whenever his costs go up he goes after labor. We thought about cutting hours not positions. Tony said it was in the paper. Tony said he already has high blood pressure. Tony said he would not go into detail because it sounds like it is not going to happen. Selectman Brien Ward could not remember this being mentioned at the meeting. Tony went on to say that his total budget is down 8.2%. Tony said he has heard the comment many times that government is not a business it is a service. Tony then gave an explanation on his budget to the budget committee. Tony said that he had cut out his part time position. He took out $200 for uniforms. They will have to be replaced. He was left with $50 in overtime. He took it out. It was strictly for the low temperature alarm. What happens when the alarm goes off and there is no money in the budget to cover someone to respond to the alarm? Tony said he feels the real solution is to leave the $50 in the line and overspend. Selectman Brien Ward said we never instructed Chuck in any particular area. Chuck said there are certain areas where we can have discretion. Brien told Tony that if your budget is below the threshold it is incorrect. Town Manager Chuck Connell stated that he asked the question of was he to apply it to all the cuts to all departments. Chuck said he was told yes. Art Tighe said that Linda Warden said to check with all of your department heads to see where it can come from. Art said he would hack away the SAU for something like this. Tony said it sends a message that next time pad your budget cause they are going to cut it and that way you can get what you want. That is a message that he has been sent. Tony is asking the Board to reinstate some money back into his budget. He is asking for it to be done and if you don't then he will understand. Tony said he is not worried about other department heads at this point. He is worried for his department. One of the budget committee members thought Tony's budget was very good. He was diligent and his revenues were probably pretty well considered. He offered that because he saw no reason to temper his budget. Brien said has not commented on the budget. We did request a 4% reduction. The Fire Department is up 30%. Brien said it makes no sense to bring Tony's budget below when the Fire Department is over. Brien stated that a fair chunk of that is budgeting real numbers at some point in time.

Tony said they had discussed income and how difficult is to predict. They need a new baler. Tony said they have a Warrant Article for $52,000 and then another one for $21,462 because we are reinvesting that to buy bags. Tony said they need to spend $10,000 to expand because there is no break room. It is not fair on the help. Selectman Brien Ward asked Tony if he wanted another Warrant Article for an addition. Tony said he did not want one until next year.

Selectman Brien Ward advised those present about an article in the Globe where forecasters are predicting the longest slump in 50 years. Brien said we are going to suffer the worst real estate slump in the past 50 years. There is continuing decline in values, which is expected to last through 2008 and 2009. Brien encouraged everyone to read the article in today's Globe. A member of the budget committee said he had read the same article, which was in the Union Leader. The article said not to expect any turn around in real estate until 2010. So everyone needs to curb on spending.

Tony stated that Littleton has one of the lowest budgets for a Transfer Station. Tony said that since 1994 until 2007 we have saved the town $1.25 million. Tony said he could defend that amount. Art Tighe asked Tony when he said the union is greedy, did he mean both unions. Tony said no he has not seen the Police Department union agreement.

Steve Kelley asked that when the Fire Chief comes and announces that he is in negotiations with the union to use a part time person is that factual. Chuck Connell said that it is not factual. Steve said it makes it sound like the union gave something that they didn't need to give. Steve Kelley said the second thing they are going to be talking about is the .75 cents for two years just to support the wage increase. Steve went on to say that when we renegotiate the contracts we should get rid of the COLA or the step for a period of time. Selectman Brien Ward said the number one complaint he hears all the time is why does the Fire Department go out with the ambulance. At least fifty people have said why are they doing this. Steve Kelley said if they want to maintain their eight-man force they need to make it affordable. Chuck Connell said he hears the message. Steve said again get rid of the COLA or the step. Chuck asked Steve what if they said no. Steve said it would be a take it or leave it situation. Steve said you never want a contract without binding arbitration. Steve said it was not a negotiation the last time. It was a give away of $533,000 just for the labor component. Steve said he does not like to hear there is nothing we can do about it. Chuck advised him that they were not here to discuss or to prepare for the next time they negotiate.

Steve just do not tell me there is nothing we can do about it. Selectman Brien Ward said we try not to be micro managers. Brien said he believes the manager's should be an advocate for the employees. Vice Chairman Eddy Moore said he never understood the union contact before. Eddy we are trying to get a better understanding of it. Chuck Connell said shame on everyone who voted on something they did not understand. Brien Ward said the statement was not fair. Brien said we are prisoners. Chuck said he understands the level of frustration. Steve said that he was glad Chuck was budgeting for a professional negotiator. Art Tighe said he thought the expense for that was $7,000 to $10,000. Chuck said it would be stupid not to do the expense of a professional negotiator. Chuck said that you want to reduce that $533,000 in half. Steve said he is in strong favor of it out so he does not have to go thru this again. Selectman Brien Ward placed the motion to adjourn the meeting at 6:25 PM. Vice Chairman Eddy Moore seconded the motion. Motion passed 3-0.

Meeting adjourned at 6:25 PM

Respectfully submitted
Ceil Stubbings
Executive Secretary

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Chairman Burton Ingerson

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Vice Chairman Eddy Moore

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Selectman Brien Ward

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