BENNINGTON SELECT BOARD MEETING BENNINGTON FIRE FACILITY 130 RIVER STREET BENNINGTON, VERMONT 05201 MONDAY, MAY 23, 2011 MINUTES BOARD MEMBERS PRESENT: Joseph Krawczyk-Chair; Matt Maroney-Vice-Chair; Sharyn Brush; Jason Morrissey; Justin Corcoran; Chris Oldham and John Zink. ALSO PRESENT: Stuart Hurd-Town Manager; Brooke Thompson; Terry Morse; Melissa Currier and John Goodrich. 1.EXECUTIVE SESSION (2ND FLOOR CONFERENCE ROOM) A.INTERVIEWS FOR BOARDS & COMMISSIONS - BENNINGTON HOUSING AUTHORITY At 7:00 P.M., Joseph Krawczyk called the meeting to order. 2.MINUTES - MAY 9, 2011 Sharyn Brush moved and Chris Oldham seconded to approve the Minutes of May 9, 2011 as submitted. The motion carried with Justin Corcoran abstaining. 3. WARRANTS The warrants were circulated for signatures after Mr. Hurd answered Board questions on painting, kennel fees, the Department of Agriculture, stucco repairs, and the Lobster fest. 4. CITIZENS Ms. Thompson, owner of the Northside Dairy Bar, noted her contribution to the community as an employer and taxpayer, and expressed her concern with the criteria involved when issuing vendor permits. She feels that vendors should be limited to Main Street and/or on Town property, and that there should be a more equitable basis for determining the fee structure for them. Mr. Krawczyk explained that Ms. Thompson is a property owner and the value is in the property, itself. The vendors do not own the property that they set up on. Mr. Morrissey stated that Ms. Thompson had given him something to think about, and Mr. Zink added that the vendor on Northside Drive is set up on private property and that the Board doesn't control or regulate private property. Mr. Hurd will review the content of the vendor ordnance. 5.WATER/SEWER FUND BUDGET & RATES DISCUSSION Mr. Hurd reiterated the Board's request to present two scenarios - one showing the water and sewer rates raised to 18% and the other showing the water and sewer rates raised to 20%. The Water Fund depreciation has been projected by Ms. Currier to be $500,000 with the $165,000 only 1/3 of that, and not the entire amount needed as Mr. Hurd had originally thought. The rate proposals for FY12 through FY14 have been presented, however, the only year requiring a decision at this time is the rate for FY12. Discussion ensued with the following questions/comments: * Proposal A (16%, 12% and 3% Annual Increases) - 2012 Water Flat Rate Increase = $47.76; 2012 Sewer Flat Rate Increase = $26.86; 2013 Water Flat Rate Increase = $41.56; 2013 Sewer Flat Rate Increase = $29.82; 2014 Water Flat Rate Increase = $11.64; 2014 Sewer Flat Rate = $33.10. * Proposal A annual revenue increases - 2012 Water = $4,132; 2013 Water = $176,075; 2014 Water = $181,941; 2012 Sewer = $4,060; 2013 Sewer = $126,621; 2014 Sewer = $267,508. * Proposal A will give us our depreciation amount of $500,000 so a plan can be developed to replace our very old system. * We should be replacing the system at a rate that will diminish a catastrophic occurrence instead of placing the extra money that is collected in reserve accounts. * The $500,000 in depreciation is a 3-year forecast based on the potential water fund purchases that will be added and current assets that will be deleted as they become fully depreciated. It is not a fixed number. * Depreciation is reflected in our fund balance. It enhances our cash position, but cannot be drawn upon in emergencies without deficit spending. * From an auditing prospective, we cannot call the money collected to build up depreciation and replenish our fund balance "a reserve" until we have reached the $500,000 amount. * In the past, we haven't included depreciation in our budgets in order to keep our rates as low as they could be. Because of that, we have been drawing against our fund balance. * Proposal C (20% Annual Increases) - Annual Revenue Increase - 2012 Water = $70,246; 2013 Water = $409,398; 2014 Water = $825,642; 2012 Sewer = $129,280; 2013 Sewer = $418,158; 2014 Sewer = $770.918. * Proposal B (18% Annual Increases) - Annual Revenue Increase - 2012 Water = $38,368; 2013 Water = $333,213; 2014 Water = $688,348; 2012 Sewer = $101,453; 2013 Sewer = $349,815; 2014 Sewer = $650,295. * Mr. Morse will present the Board with some system related projects to prioritize as part of the strategic objectives discussion on June 9, 2011. * Mr. Goodrich explained that "accounting-wise" "real depreciation = reserve" and is a cash entity, whereas, depreciation on a hard asset is only a tax advantage. Matt Maroney moved and Jason Morrissey seconded to table the setting of the FY12 Water and Sewer rates until a future meeting. The motion carried unanimously. 6. 2011 LIQUOR AND TOBACCO LICENSE APPLICATIONS The following New 2011 Liquor and Tobacco License Application was approved by the Board: 2011 Liquor License Application - Second Class - and Tobacco Application 1.TAC, LLC 7.APPOINTMENTS TO BOARDS & COMMISSIONS None. 8. MANAGER'S REPORT Mr. Hurd reported that we are only lacking $550 to fund our fireworks display. Price Chopper has committed to $3,000, Casella is expected to do the same, BCIC members have pledged $2,250 and Jerry Prue Electric has pledged $200. 9. OTHER BUSINESS Mr. Krawczyk wished everyone a safe Memorial Day Weekend and reminded everyone of Mayfest. 10. EXECUTIVE SESSION A.Contracts At 8:23 P.M., Chris Oldham moved and Justin Corcoran seconded to go into Executive Session to discuss Contracts. The motion carried unanimously. Respectfully submitted, Nancy H. Lively, Secretary