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Minutes of Board of Finance, 07/22/2013

AGENDA: Board of Finance

RECEIVED 07/24/2013 8:30am
Michele R. Grande – Redding Town Clerk


Present: Alvarez (Chairman), DeSalvo, Dolan, Guffey, Mazzucco, Yonkers (7:35 pm)

Also present:   Finance Director Gniadek, First Selectman Ketcham, Selectman Pemberton, Treasurer O’Donnell, Tax Collector Moisio, nine members of the public and a representative of the Redding Pilot.

Chairman Alvarez called the July 22, 2013 meeting to order at 7:30 pm.


Motion: move to approve the minutes of the June 24, 2013 meetings as submitted.  Mazzucco, DeSalvo.  Approved. 3-0-2. Mr. Dolan and Mr. Guffey abstained.

Dr. Yonkers arrived during the Public Comment below, 7:35 pm


James Miller, Middlebrook Pond Road:  Mr. Miller asked that the decision regarding the tax appeal proceeds follow a discussion by the Board of Finance that includes a mechanism to assure that the taxpayers receive relief for their support during the appeal process over the past five years.

Jeanne Wendschuh, Deep Spring Road: Mrs. Wendschuh suggested that the proceeds of the tax appeal be used to benefit the taxpayers by funding some of the items on the long term capital list rather than funding those things through borrowing.


Tax Collector Moisio reported the collection for Fiscal Year 2012-13 reached the 100% of budget goal.


Mr. Gniadek reported that total revenue (without taxes) for FY ending June 30, 2013 is estimated at $125,000 favorable, while expenditures are forecast to come in approximately $340,000 under budget.. He reviewed the major sources of that revenue and expenditure variances, and reminded everyone that these numbers are unaudited and therefore may be subject to change.

Mr. Mazzucco asked about the item called investment income. Mr. Gniadek explained it was a $6,000 shortfall in interest income.

Mr. Mazzucco asked if there was any information regarding how other towns are allocating the expenses associated with the School Resource Officer (SRO) positions to the school budget rather than the town operating budget.  Mr. Alvarez and Mr. Gniadek noted that some towns do allocate SRO expenses to their school budgets. Mr. Alvarez said it would be an appropriate item for discussion in the fall.

Dr. Yonkers inquired about the status of the Stepney Bridge Repair project. Mrs. Ketcham responded that there new legislation was enacted that may mean that Redding could qualify for additional funding for the project.


Treasurer O’Donnell submitted a written report of the Town’s cash balances. The cash balance in the General Fund was $11,484,634. The cash balance in the Capital Nonrecurring Fund was updated to $1,066,736,

Mr. Mazzucco asked about further investment in laddering of CDs. Mrs. O’Donnell responded that she is continuing to monitor the investments in the ecd market since this new method of investing money is new and she wants there to be a comfort level with the online banks that is acceptable. She acknowledged that most towns funds are invested at about 15 basis points and that the latest one-year CD pays 56 basis points.  She also noted that the town is currently considering a banking change.  Three banks, Union Savings, TDBank and Webster Bank, are being considered for the Town.  The subcommittee is in the process of evaluating the options, with great consideration on the working relationship and function, as well as the banking fees.  She is hopeful a decision will be made next month.


Richard Regan, Chairman of the Water Pollution Control Commission, addressed the Board with a request for additional funding for the replacement of the membranes in the wastewater treatment facility.  Mr. Regan provided detailed information on the function of the membranes and their current condition.  The WPCC has a proposal from the current supplier, GE/Zenon, for replacement of the membranes with a newer, taller type of membrane and new hoist for a cost of $320,000.  Another vendor, Layne Christenson, has a new type of membrane material available and their representative gave the WPCC a presentation at their last meeting.  The WPCC is waiting for a proposal for the replacement of the current membranes with the Layne system.  Both vendors believe the new membranes will improve operation ability and will lower the electrical expenses.

Mr. Regan noted that the current system is not functioning as effectively due to the age and deterioration of the membranes. Cleaning efforts were effective in increasing function, but recent cleanings has shown little or no recovery and decreasing function.  When the plant has high flows that cannot be handled by the plant, excess liquid must be hauled away.  Those hauling costs have increased in the last three months:  $2,700 in May, $7,300 in June, $24,000 in July.

Discussion followed.  Mr. Alvarez suggested that it may be time to put the entire plant operation under control of the town, integrated in the town’s operating budget.  He suggested that this potential be investigated.

The WPCC has borrowed money, $410,713.75 from the Town of Redding to meet operating expenses.  This is due to the lack of payment from GSTD, which currently owes the WPCC $1,138,597.18 in usage fees.  The Town of Redding has liens in place for the payment of the past due real estate taxes and the WPCC sewer usage fees.

Dan Robinson, WPCC member, commented that each month the amount that GSTD owes increases by $23,975. When and if the GLDC property transfer is completed, the amount due from them could be applied to the money borrowed from the town.

James Miller, WPCC member, asked how the WPCC would deal with going with a different vendor if the product is better but more costly than the current proposal.  Mr. Alvarez responded that if that is the situation, the WPCC would have to come back to the Board of Finance for additional funding.

Motion: move that the Redding Board of Finance lend the WPCC, on the basis that they have in the past, an amount not to exceed $350,000 to fund a membrane replacement program of their choice. Mazzucco, DeSalvo.  Approved. Unanimous.

Mr. Mazzucco also asked that the town attorney be consulted for an opinion on to what extent the WPCCs finances and operation could be integrated with the Town.


The Town received $1,034,109 as a result of the favorable decision on the appeal regarding the Meadow Ridge Health Care facility.  The Board of Finance members discussed options for the use of the funds at the previous meeting. Mr. Alvarez suggested the board give further consideration to the establishment of Debt Service Account with the intent to offset the budgeted principal by approximately $200,000 in each fiscal year for five years, beginning next year.  This would reduce the budget and mill rate, thereby benefiting the taxpayer. Discussion of the proposal followed, along with discussion of using the money to fund some of the items on the Capital Plan.

Motion: move that the Redding Board of Finance use the tax appeal proceeds to create a Debt Service Fund to reduce the budget principal over the next five years as illustrated on Mr. Gniadek’s proposal, with the reduction beginning in the next fiscal year (2014-15). Mazzucco, DeSalvo. Approved. Unanimous.


Mr. Alvarez established a subcommittee to review the Elderly Benefit program.  He asked Mr. Dolan to volunteer for the committee along with himself, Tax Collector Moisio and Assessor Ford.  The subcommittee will meet and report at the next meeting. It has been ten years since the program was evaluated, and there have been many changes in social security and the economy.  Any suggestions for consideration should be sent to him.


Motion: move that the Redding Board of Finance meeting be adjourned. Mazzucco, DeSalvo. Approved. Unanimous.

The meeting adjourned at 9:02 pm

Respectfully submitted,

Mary Maday, Recording Secretary

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