Finance Committee

REPORT OF THE FINANCE COMMITTEE NOVEMBER 20, 2013 A meeting of the Finance Committee was held on Wednesday, November 20, 2013 at 7:03 p.m. in the Aldermanic Chamber. Mayor Donnalee Lozeau, Chair, presided. Members of the Committee present: Alderman-at-Large David W. Deane Alderman-at-Large Barbara Pressly Alderman June M. Caron Alderman Arthur T. Craffey, Jr. Alderman Paul M. Chasse, Jr. Members not in Attendance: Alderman-at-Large Lori Wilshire, Vice Chair PUBLIC COMMENT – None COMMUNICATIONS From: Robert Gabriel, Purchasing Manager Re: Protective Clothing Change Order #1 for Nashua Fire Rescue (Value: $17,500) MOTION BY ALDERMAN CHASSE TO ACCEPT, PLACE ON FILE AND AUTHORIZE CHANGE ORDER #1 TO THE CONTRACT WITH BERGERON PROTECTIVE CLOTHING FOR A NET CHANGE IN THE AMOUNT OF $17,500. FUNDS ARE AVAILABLE IN DEPARTMENT 152, FIRE; GENERAL FUND OPERATING BUDGET; 61, SUPPLIES & MATERIALS ON THE QUESTION Mayor Lozeau This is the annual second installment for protective clothing. The first one happened in September. I know all of you probably know this. The second one typically happens in January, and the third one typically happens in April. They moved it forward a little bit early because there’s a potential three percent increase coming in January, and they wanted to try to get in ahead of that. Alderman Deane This is the part of their protective clothing replacement schedule that they have which they need to do. I don’t have a problem with that. I wouldn’t want to go into an event with something that was deficient, trying to keep the heat and whatever off my body. If the equipment is going to go up three percent, are they going to try to do something about that increase prior? Are they going to look at trying to figure out what they need for sizes prior to that? If they’re going to buy it, can they do it earlier to save the three percent increase on the product? Mayor Lozeau I think they’re going to consider that. That’s what they are doing with this first batch. Usually the third one sometimes it changes. It goes up or down depending on how their budget looks. They wait a little bit for that. I’m sure they’ll look into it; we had that conversation. Finance – 11/20/13 Page 2 Alderman Caron We got ten the last time. Is that what it was because I don’t see it here? I remember it came before Finance. Mayor Lozeau They’re budgeted for 28, so it’s about that. MOTION CARRIED From: Robert Gabriel, Purchasing Manager Re: Purchase of Thermal Imaging Cameras for Nashua Fire Rescue (Value: $31,485) MOTION BY ALDERMAN CHASSE TO ACCEPT, PLACE ON FILE AND AUTHORIZE THE PURCHASE FROM FIRE TECH & SAFETY OF NEW ENGLAND IN THE AMOUNT OF $31,485. SOURCE OF FUNDING IS DEPARTMENT 152, FIRE; GENERAL FUND OPERATING BUDGET; 71, EQUIPMENT ON THE QUESTION Mayor Lozeau These are their infrared cameras. They come through and try to update them. After this purchase the oldest they will have among the cameras is a 2003 model. Then they’ll all be underneath that ten year window. MOTION CARRIED From: Robert Gabriel, Purchasing Manager Re: Purchase of Bomb Suits and Helmet Requested by Nashua Police Department (Value: $40,928) MOTION BY ALDERMAN CHASSE TO ACCEPT, PLACE ON FILE AND AUTHORIZE THE PURCHASE FROM MED-ENG IN THE AMOUNT OF $40,928. FUNDS ARE AVAILABLE IN DEPARTMENT 150, POLICE; 2012 HOMELAND SECURITY GRANT; 71, EQUIPMENT ON THE QUESTION Mayor Lozeau The two that they have are about ten years old, and they really should not exceed a ten-year life based on the materials they are made out of. I looked at this and thought I don’t think you could buy me a suit that would be good enough to touch any bombs. I can’t imagine getting into a suit and going okay now you can go work on that bomb. I just can’t imagine. Alderman Deane It doesn’t come with a bowtie does it? Mayor Lozeau Not that I’m aware of; I think that might be extra. Finance – 11/20/13 Page 3 Alderman Deane Was this a sole source? Mayor Lozeau I believe it was a sole source. Alderman Deane Special purchasing procedure for sole source. It’s probably one of those items that not many … Mayor Lozeau People make. Alderman Deane Ya, again if there’s a life expectancy on the protective equipment and you’re asking people to do this, you want to make sure they’re wearing what they need to wear. Mayor Lozeau Exactly. MOTION CARRIED From: Robert Gabriel, Purchasing Manager Re: Purchase of Assault Shields Requested by Nashua Police Department (Value: $48,400) MOTION BY ALDERMAN CHASSE TO ACCEPT, PLACE ON FILE AND AUTHORIZE THE PURCHASE FROM RILEY’S SPORT SHOP THROUGH NH CONTRACT #8000882 IN THE AMOUNT OF $48,400. SOURCE OF FUNDING IS DEPARTMENT 150, POLICE; US DEPARTMENT OF JUSTICE FORFEITURE FUND; 71, EQUIPMENT ON THE QUESTION Mayor Lozeau This is to purchase special shields for assault level protection to put in our cruisers. I looked at this is thought 19 pounds is pretty heavy. I don’t know if I’d want to be holding that until I found out that the ones that they currently have are almost 50 pounds. Alderman Deane I guess if someone’s trying to assault you with something, holding a 19 pound piece of protection, I bet you could hold it for quite awhile. Mayor Lozeau I bet you could much longer than the 50 pound one even in the worse of circumstances. Finance – 11/20/13 Page 4 Alderman Chasse They’re going to wear that with the bomb suit. Mayor Lozeau No, that doesn’t go with that. MOTION CARRIED From: Robert Gabriel, Purchasing Manager Re: Replacement of Centennial Pool Filter for Park Recreation Department (Value: $35,646) MOTION BY ALDERMAN CHASSE TO ACCEPT, PLACE ON FILE AND, CONTINGENT UPON BOARD OF PUBLIC WORKS APPROVAL, AWARD THE CONTRACT TO METHUEN CONSTRUCTION IN THE AMOUNT OF $35,646. FUNDS ARE AVAILABLE IN DEPARTMENT 177, PARK RECREATION; ESCROW FUNDS ON THE QUESTION Mayor Lozeau Alderman Deane, I asked Mr. Caggiano to put the pictures of this filter in because when we talked about in the Budget Committee, we talked about the cost of a filter. These pictures demonstrate to you that it’s really all of these components. It’s not just the filter. Alderman Deane This is the old filter. Mayor Lozeau Right. This is what’s there now. This is what they are replacing: the pool filter, the motor and the pump, the backflow system. Everything except the last picture for the breaker boxes. Alderman Deane That’s being replaced also. Mayor Lozeau Not yet. Alderman Deane But it’s got to be replaced. Mayor Lozeau It does. Finance – 11/20/13 Page 5 Alderman Deane As we know chlorine eats everything whether it’s in contact with it or whether it’s just in the general surroundings in a confined space which is what this ends up being with some ventilation. It just starts rotting everything in its path. Now what you do is put plastic other than the wires obviously. Everything is sealed now so you don’t have the deterioration. Mayor Lozeau I just wanted to let you know that it wasn’t part of this bid though, those breaker boxes. Alderman Deane That will be additional. Alderman Pressly Are they going to install this now or wait until the season starts? Mayor Lozeau They actually can install it over the winter without any trouble. Alderman Pressly And it’s okay to do that? Mayor Lozeau It is. Alderman Pressly If there is corrosion does it make sense to wait until they are ready to use it? Mayor Lozeau I talked to Mr. Caggiano. It really doesn’t matter When they company can get in there and do the work, they’ll have them get in there and do the work. Alderman Deane What you do Alderman Pressly is you cut a pipe at one end and you cut the pipe at the other end. All the junk in between which is the old filtration system from the 60’s, you take it out. You set the new filtration system and most of its plastic. I don’t know what they use for piping. Mayor Lozeau PVC. Finance – 11/20/13 Page 6 Alderman Deane Schedule 80 piping. You want to use Schedule 80 because it doesn’t break down from the chlorine like Schedule 40. It can just be left to sit there and dry. When we replaced our filters we did it in the dead of winter. Mayor Lozeau I’m assuming that you’re asking because you’re thinking if you put water through it and it freezes, that sort of thing. As Alderman Deane was just saying, they are likely to leave it dry. Alderman Deane They won’t put any water into it until the pool is filled again. That’s the only way to be able to get water into it. Alderman Pressly Thank you. The timing seemed sort of unusual. Alderman Deane Off season is the time to do it. Alderman Caron I was just going to say this filter system was put in about 1987. It was the top of the line at that time, but things have changed. It does corrode. It doesn’t take long, and you have to change it. It’s better to do it now because if it breaks down during the season or before the season it could be even worse problems for you. I think this is a good idea. I’m happy to see that they’re moving forward with that. Alderman Deane I’m surprised Methuen Construction actually bid on this. Mayor Lozeau As was I. Alderman Deane They were the low bidder, right? Mayor Lozeau Right. Alderman Deane And they weren’t the sole bidder, right? Mayor Lozeau No. They weren’t. There were four bidders. Finance – 11/20/13 Page 7 Mayor Lozeau I think they are doing a lot of work right now in the City. They just finished the dam. Today at the ribbon cutting he said: Well, Mayor, we’ll just be moving down the street. I thought he was being funny and talking about some day we’re going to do Mine Falls. Then I read the memo and said he must have meant Centennial Pool so literally down the street. Alderman Deane A number of years ago they had to cut a hole in the roof of that building. Alderman Caron That’s right. They had some problem with the chlorination. It was coming through. You couldn’t’ go into the building. They had to open it up. Then they had to take out all the filtration sand. They used the sewer vac. Alderman Deane The Vactor truck is what they used. Alderman Caron Right, to take it out. Alderman Deane They opened the top of the steel cover on the top of the filter and drop the Vactor. That’s why they cut a hole in it. Alderman Caron That’s right. Alderman Deane I remember them doing that. MOTION CARRIED UNFINISHED BUSINESS – None NEW BUSINESS – None DISCUSSION Alderman Chasse I was kind of buffaloed when they saw the tax rate, the $200,000 homes getting another $400 added to their taxes. When Mr. Fredette did all the bonds, redid the bonds and he saved us a lot of money, is that real money? Was that cash that came to us out of those bonds or is it just a refinance? Finance – 11/20/13 Page 8 Mayor Lozeau There’s two things. When we sold the bonds at a lower rate, the money that we saved is real money. Nothing came back to us but we didn’t have to spend at a higher rate. Then we refinanced the bonds that we did and saved a lot of money, that’s real money. We won’t see that yet this year. We’ll see that in the next couple of years. The tax rate, as I had mentioned, 53 percent paid the same or less. The people over the 53 percent, they broke into two categories: 21 percent paid somewhere between $1.00 and $200. Then 16 percent paid somewhere between $200 - $400. Then the remaining that paid greater than $400 or up to $500 are people that put additions and things like that on their house. As Mr. Marino explained it to me, people in those higher categories that got somewhere between $200 and almost $500 added it’s because in the prior two years their evaluation was less than it should have been. They paid less than they should have if it would have been revalued at that point. I’ve been talking to some of the people that have seen significantly increases. I’m in the 16th percentile. I got a call from my husband when the tax bill came in saying we’re paying $400 more. It wasn’t everybody that’s in the $200,000 category. It’s really spread out. Some of the folks that I’ve talked to that raised concerns with me, I’ve encouraged them to come in for an abatement to make sure that everything was done according to the way it should have been done. If you have folks in that same circumstance, if you let me know we’ll make sure they have the information on the process so they can do that. It was a small percent, but it hurts nonetheless. Alderman Chasse In my opinion, and this is only my opinion now, the report card for this Board of Aldermen and you Mayor, was a F. That’s my opinion. Mayor Lozeau If there was not a revaluation this year, the tax rate would have increased 2 ½ percent on everybody. For 53 percent of the population, they saw no increase. The remaining ones meant that there was an assessment to be done. Myself, nor the Board of Aldermen, can control how that assessment plays out. Alderman Chasse But we can control the budget. Maybe we’ll have to challenge you, Mayor, to come in with the skimpiest budget you can next time around because people out there, the economy, gas has gone up. Someone with a $400 increase on their tax bill are also going to get about a $90 increase at the waste treatment plant. That’s almost $500 more a year going out to the City of Nashua. Mayor Lozeau It’s not $90 for the wastewater. Alderman Chasse Forty-five? Mayor Lozeau Forty-five. Alderman Chasse Even $45. It’s a $45 bill. If we look at gas, the food in the markets, everything is going up. People out there are having a hard time. Just look at the foreclosures around. I’ve got four of them in my neighborhood Finance – 11/20/13 Page 9 right now. People are just walking away from their homes and saying I can’t live here anymore. So I challenge you, Mayor Lozeau, to come in with a skimpy budget next year. Mayor Lozeau But also remember this last budget, $3.7 million, $3.7 million of the increase in our budget this year was driven by the increase in pension costs that we have no control over. The state gave us a 26 percent increase, and their share went to zero. When you think about what our spending was after that, there wasn’t a lot of spending. We came in under the Cap. We came in below that rate. Yes, there are some people like I said that got hit with an increase. Alderman Chasse We’ve given out contracts now with higher percentage rates. Those are going to have an effect on the budget next year. We’re going to have to skim someplace else. I hate to use that word because I work in Human Resources, but does it mean layoffs? In the real world out there, companies are scrimping and they are having layoffs. I don’t want to see anybody get laid off but you got to do what you got to do sometimes. Mayor Lozeau But remember, Alderman Chasse, we have gone through the worst recession since the Great Depression. We’ve lost more than $20 million in a period of time from both local and state revenues. We’ve managed to keep the tax rate increase at below three percent a year and not even three percent in the majority of years. We had an increase in the first year of .08. The second year it was 2.8. The third year it was 2.9. The fourth year it was 2.5. This year it would have been 2.5. In 2010, we had a similar situation that took place. We did a revaluation. Then it was 75 percent of the people paid the same or less. We went through a similar thing with people that were above that rate. I don’t disagree with you that it’s still tough times for people. But if we do large layoffs, we will experience what other communities have which means businesses are not going to grow here, people are not going to want to live here. We have to strike that right balance to maintain a community where people want to expand their businesses and stay. I met with a business yesterday that’s looking at increasing to being 300 employees in this city. That’s a big deal. One of the things they are looking at is the schools and the services. The only thing worse than increasing somebody’s tax rate is increasing their tax rate and cutting their services. It is a balance, and I don’t disagree that we have to pay attention. I think we’ve done a good job with what we’ve been handed. Does that mean we can still sharpen our pencils, I think we can. Alderman Chasse I want to say one more thing so the Nashua Telegraph does not put in there that I’m advocating layoffs. That’s not what I said. I don’t want to see it making headline news tomorrow. Alderman Craffey It’s going to be in there, Alderman Chasse. It’s going to be in there. Alderman Chasse I know. Alderman Pressly I was going to ask about the sidewalks at the Grace Fellowship Church. I know we had a discussion. The last time we talked about this you were not sure because of the proximity to the railroad tracks that the Finance – 11/20/13 Page 10 portion of the Main Street would be done this year. Did you have some agreement with PanAm or with the church so it was able to be done this year? Mayor Lozeau The reason we were waiting is because we wanted to work with the railroad to redo that crossing. They’ve asked us in the last few years to do that. We stood ready to do that. Because we did Franklin Street it just made sense when we were already there digging things up so we didn’t wait for the railroad to do that crossing. We figured we could at least have that side not be disrupted again but we’ve not done the other side yet. Hopefully that will wait. If we were on the other side doing work, we probably would come around that corner as well. Alderman Pressly I’d just like to comment that I’m glad you did. I agree with you it would have looked very strange not to have. I know you mentioned you were waiting on the railroad. Mayor Lozeau We were. I didn’t’ know the extent of the damage on Franklin Street and how much of that sidewalk would come out. When we decided to do that, it must made sense to keep going. RECORD OF EXPENDITURES MOTION BY ALDERMAN CHASSE THAT THE FINANCE COMMITTEE HAS COMPLIED WITH THE CITY CHARTER AND ORDINANCES PERTAINING TO THE RECORD OF EXPENDITURES FOR THE PERIOD NOVEMBER 1, 2013 TO NOVEMBER 14, 2013 MOTION CARRIED PUBLIC COMMENT – None NON-PUBLIC SESSION MOTION BY ALDERMAN CHASSE THAT THE FINANCE COMMITTEE GO INTO NON-PUBLIC SESSION BY ROLL CALL PURSUANT TO RSA 91-A:3,II(e) TO CONSIDER AN EMPLOYEE PERSONNEL MATTER FILED AGAINST THE CITY SECONDED BY ALDERMAN DEANE A Viva Voce Roll Call was taken, which resulted as follows: Yea: Mayor Lozeau, Ald. Deane, Ald. Pressly Ald. Caron, Ald. Craffey, Ald. Chasse 6 Nay: 0 MOTION CARRIED The finance committee went into non-public session at 7:26 p.m. MOTION BY ALDERMAN CHASSE THAT THE FINANCE COMMITTEE SEAL THE MINUTES OF THE NON-PUBLIC SESSION BY ROLL CALL UNTIL SUCH TIME AS THE MAJORITY OF THE COMMITTEE VOTES THAT THE PURPOSE OF THE CONFIDENTIALITY WOULD NO LONGER BE SERVED Finance – 11/20/13 Page 11 SECONDED BY ALDERMAN DEANE A Viva Voce Roll Call was taken, which resulted as follows: Yea: Mayor Lozeau, Ald. Deane, Ald. Pressly Ald. Caron, Ald. Craffey, Ald. Chasse 6 Nay: 0 MOTION CARRIED MOTION BY ALDERMAN CHASSE TO COME OUT OF THE NON-PUBLIC SESSION AND RETURN TO THE FINANCE COMMITTEE MEETING MOTION CARRIED ADJOURNMENT MOTION BY ALDERMAN CRAFFEY TO ADJOURN MOTION CARRIED The Finance Committee meeting was adjourned at 8:01 p.m. Alderman Paul M. Chasse, Jr. Committee Clerk