Meeting opened at 7:00 p.m.

In attendance: Mike Cutting, Marc Violette, Barbara Bartlett, David Karrick, John Warner, Precinct Commissioner Pete Newman and Selectmen Richard A. Cook

Others present:  David E. Hartman – Selectman Wayne Eigabroadt - Selectman

Laura Buono – Town Administrator Martha Mical

March Violette made the motion to approve meeting minutes dated August 24, 2006. Richard A. Cook seconded the motion. All were in favor. The motion passed.

The Town Administrator passed on information regarding the Old Grade School and the cost per square foot (2005) for CAP, Daycare and the preschool programs. Capital expenses are not included in the cost per square footage. The Committee members, now knowing the actual costs discussed the possibility of recommending not totally subsidizing the Co-operative Preschool. Selectman Eigabroadt recommended allowing the voters to decide because they made the decision originally. Mr. Cutting disagreed; the Committee’s charge is to put forth a budget that meets the needs of the Town that is fiscally responsible. Selectman Cook explained that the Selectmen will be meeting with a representative from each of the groups within the Old Graded School in order to learn more and obtain a better understanding of the services that they provide. Also, Selectman Cook recommends that if there are going to be changes, they should begin in 2007, they deserve a year’s notice.

At the last meeting the Budget Committee recommended a 1.8% increase to the 2007 budget asking the Selectmen to return and report on the consequences of such a proposal. The Board of Selectmen met on September 7^th and determined that the 1.8% is not realistic. The Selectmen feel that there are too many capital expenses that need serious attention. The Selectmen agreed that the Town cannot continue to cut capital expenses and be responsible to the taxpayers in the future as well as the taxpayers in one year. The feeling of the Selectmen is to look at the budget without the constraints of a target, to be able to work with the Department Heads in order to achieve a good sense of what they need to maintain the current services and look at the Capital Improvements.

Budget Committee member John Warner asked the Selectmen if they do not feel the Budget Committee should set a target percentage. Selectman Cook explained that the Board of Selectmen is not saying the Committee should not set a target. The Selectmen are not going to agree with a target nor at this time are they going to set a target. The Selectmen need to see figures from the Department Heads along with capital expenditures.

The Committee explained that the intent of this meeting was to discuss an alternative to the 1.8%. Why could we set a goal last year but we can’t do it this year. Selectman Cook explained the difference is that the Board of Selectmen does not feel that it would be constructive at this point to set a number because they have too many concerns about what the capital expenses are going to be and they have not seen a complete Capital Improvements Program.

One concern is the cost of a fire truck in the amount of $237,500.00, to date the grant has not been received. The grant has been applied for the second time. The Highway Department may be requesting a new loader, road projects all falling behind. Selectman Eigabroadt explained the he does not mind setting a target number, he has a problem with the 1.8% especially knowing the upcoming capital expenses. If a target is set at 3 or 3.5%, the Board will work hard to achieve that. But without cutting services, the Board of Selectmen recommends that the Budget Committee looks hard at the capital expenses. The Road Committee is underway, which will assist the Selectmen to identify priorities for upcoming costs on road repairs.

The Committee and the Selectmen discussed the budget in relationship with the school, capital expenses payroll etc. Last year the Selectmen maintained a 3% increase only by cutting capital projects such as the Town Hall roof, the front steps need leveling at the Town Hall, electrical on the stage as only a few.

Selectman Cook reminded the Committee that they began the year by saying that the Town needs to be thinking about addressing the long term needs. A number can be set for the operating budget, but the Selectmen believe that the voters need to see a realistic cost on the capital improvements that are required. Then the voters can decide. Are we continually going to post pone things that we really should be saving for the future or are we continually going to cut those so that in 5, 6 or 7 years we have to say we have to pay in one year or bond it into the future. Last year was an example of cutting back in order to make the 3%.

The Committee asked what would happen if a goal is set for the operating expenses. Selectman Cook would be in favor. The largest factor would be personnel. The Committee asked what the Selectmen are looking at from a payroll standpoint. The Selectmen have not discussed payroll yet.

The Committee asked if the Selectmen would be comfortable applying 1.8% to the operating budget. Selectman Cook would not agree to a 1.8% applied to the operating budget but would agree to a 2.5% excluding fuel costs.

Barbara Bartlett asked how wage increases are handled. Selectman Cook spoke only about last year. Last year wages and benefits was allowed a 3% growth. After the increased benefits the leftover went to wages. The Selectmen have not decided on this year’s wages.

Selectman Eigabroadt also spoke in favor of the 2.5%.

John Warner recommended going back to the original question, are we hurting the Town by setting the kind of limit that was set last year. What’s going to happen if limitations are continued long term? Selectman Cook feels that the question was answered in some way, if we were to continue to limit the growth of the capital budget; he feels we are putting off costs that we can no longer afford as a Town to keep postponing in the capital budget. It is up to the voters, a warrant can be presented on every item.

Mr. Warner explained that the capital budget is about 20%; it has a .2 multiplier to effect the whole situation. What if you accept and target a 2.5% for everything else, what is that going to do. Selectman Cook explained that there is consensus among the Board that they are not in favor of cutting Town services.

Selectman Eigabroadt explained that without seeing the Departments budget the question cannot be answered directly other than when the Board returns with a budget it will be the bare bones without disrupting services.

Mr. Warner asked if the average has been 8.7 % over 7 years what was it over the last previous 6 years that somehow was different were it was settled in with a 3% and somehow it worked. Selectman Eigabroadt explained that the recent Board of Selectmen worked more collectively with the Budget Committee.

The Committee discussed the fact that expenses have consistently increased more than revenue’s received. The difference is made up from taxation.

Selectman Hartman asked the Committee their views on salary increases and benefits. Mr. Violette, because he made the motion on the 1.8%, explained that he was not thinking about salaries just the bottom line and salaries would be a portion of that. Selectman Hartman explained that inflation is going up at a rate of 2.4% (core inflation, excluding energy costs). Mr. Violette explained that there is a wage scale in place, his experience in private enterprise is that just because the cost of living or the inflation rate goes up 2.2% doesn’t necessarily mean that everyone gets 2.2% across the board. Mr. Violette understands the wage scale to be merit based. Whatever the bottom line is, you work with the percentage (right now 1.8%), and you can’t take into account cost of living or inflation (salary only). Then you have another bucket called total compensation, at the end of the year your total compensation includes salary and benefits.

Mr. Newman commented that when the Budget Committee voted on the 1.8%, he was led to believe that was not a figure cast in stone, it was a recommendation, and the Selectmen would return with their recommendation. Mr. Newman noted that as far as he is concerned the 1.8% is not what the Budget Committee if firmly recommending, Mr. Warner agreed.

Again, Selectman Eigabroadt explained that the Board of Selectmen will return with a bare bones operating budget.

David Karrick made the motion to set a target of not increasing the operating budget more than 2.5% over last years operating budget excluding fuel. John Warner seconded the motion. Discussion, Selectman Eigabroadt added that if the Selectmen can roll fuel into the 2.5% they will. Mr. Newman feels the 2.5% is reasonable; the Committee does not have any control over the capital expenses when they go to the floor. The TA recommended showing the operating budget, spell out less the revenues, and show the anticipated tax impact on the operating budget giving you a base figure allowing you to add each capital item that is voted on. Not just during Town Meeting but getting the word out before Town Meeting. The TA is in favor of promoting the budget long before Town Meeting. Vote on the motion. One opposition, the motion passed.

Next meeting is a facility tour located at the Police Station beginning at 6:00 p.m.

Monday, October 16^th is the Capital Improvements presentation.

Motion to adjourn 8:25 p.m.