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Finance Committee Minutes 12-1-14 (Amended)

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Please find pasted below the Finance Committee minutes for December which includes the correction of a typo found in the last line in the original copy . MW

FINANCE COMMITTEE MEETING
December 1, 2014
VOTES ON ITEMS:
• Amendment to ITEM 1 12-0-0
• Amended ITEM 1 12-0-0
• ITEM 4 12-0-0
• ITEM 5 12-0-0
There were 10 delegates and 4 alternates present.

Chairman Mike Warner (D3) started the meeting at 7:35 PM.
Item 4 came up as the first item. Joe Siciliano, Parks and Recreation Director, presented the request that $75,000 be appropriated for the replacement of a chiller compressor and barrel at the Dorothy Hamill Skating Rink. The current unit is 25 years old and is used approximately 9 month out of the year. The rink has a total of two units (other unit was purchased a year ago) and the units are tested every year in August. Five weeks into the current season the older unit failed, most likely due to the milder temperatures, requiring more strain. Replacement of the older unit was already part of a capital plan in the FY16 budget. A rental option was explored, but at $7,000 per month, it would not be cost effective. The rink generates about $500,000 a season (October to March) in revenue, so the town could see a potential $20,000 loss in revenue a week as ice time is paid for after booking and use. The Town would solicit bids for the replacement and expects to receive at least 3 companies bidding on the project, including the company that services the existing unit. Bob Tuthill (D4) made a motion to call the vote and Rob Perelli-Minetti (D12) seconded. The vote taken on Item 4 passed 12-0-0.
Item 1 came up as the second item. Allan Brown, Nathaniel Witherell Executive Director, presented the request to authorize the sale of the historic tax credits related to Project Renew. In 2011 the Friends of Nathaniel Witherell applied to the National Parks Service to designate Nathaniel Witherell as a historic landmark on the National Register of Historic Places. Eligibility was determined due to the two older buildings on the campus, the “administration” building (has office, chapel, gift shop, beauty shop, etc.) built in 1933 and the “pavilion” building built in 1903. The entire campus has received the designation. The designation provides the opportunity to apply for federal and state credits. Based on legal counsel for the town, Nathaniel Witherell did not apply for federal credits, as the federal guidelines would have required Nathanial Witherell to be a “for profit” entity. The state requirement required no change in ownership or reclassification of the building. The state approved $4,490,918 in tax credits and a reservation certificate has been generated. These tax credits can be sold to a “for profit” organization to help the credit buying entity with their own tax savings initiatives. Connecticut Light and Power (CL&P) has agreed to purchase the tax credits at par (100% of their value) as a non-economic gesture of community goodwill. The proceeds from the sale of the tax credits will repay a $950,000 loan from the capital non-reoccurring funds that were used to fund Project Renew and the balance to the principle and interest on the general obligation bonds also used to fund Project Renew. Following discussion several members suggested that the resolution should be amended to indicate that the tax credits would be sold “at par”. Rob Perelli-Minetti (D12) made a motion to amend the resolution and John Dolan (D7) seconded. Since the term “at par” was not defined, the motion was redrawn and a second motion to amend was made. Resolution #2 was then amended to add “equal to the tax credit” after “to sell the Tax Credits for a price” and before the “,”. Rob Perelli-Minetti (D12) made a motion to amend the resolution and John Dolan (D7) seconded. The vote taken on this amendment passed 12-0-0. Bob Tuthill (D4) made a motion to call the vote and Rob Perelli-Minetti (D12) seconded. The vote taken on amended Item 1 passed 12-0-0.
Item 5 came up as the final item. Allan Brown, Nathaniel Witherell Executive Director, presented the request to appropriate $100,000 contingent to a $500,000 grant to be received by the town from the State of Connecticut under the Small Town Economic Assistance Program for the purchase of improved security. Mr. Brown provided some history on the development of the plans to renovate Nathaniel Witherell. In the early 2000’s an approximately $45,000,000 Nathaniel Witherell replacement facility was approved by the state of Connecticut that included downsizing of the beds. In the mid 2000’s a study by the board determined that the lower occupancy (revenue) would not be able to generate enough revenue to pay the debt burden for the project. Project Renew was the result of abandoning the replacement project. Around 2009 a $37,000,000 application of need was created, but the state declined to approve the project. The team went back to the drawing board and got a certificate of need for a $22,000,000 project which excluded many of the elements needed based on value engineering on what to remove and what could stay in the budget. Only about $30,000 was kept in the budget for security. With current events, and requests from residents, family, visitors and staff, the need for more security is required. For example, the main entrance is not manned after 8 PM, there are new entrances and exits, patients can “wander”, all leading to an increase in the potential for liability should a negative event occur. Additional security cameras will help with thefts. The board is confident that the Small Town Economic Assistance grant will be issued; but should the grant not come to fruition; the BET would reconsider non-contingent funding. Security data could be monitored and reviewed by existing facilities personnel. Timers on locks and a buzzer system will work automatically. Bob Tuthill (D4) made a motion to call the vote and Rob Perelli-Minetti (D12) seconded. The vote taken on Item 5 passed 12-0-0.
The Finance Committee meeting was adjourned at 8:30 PM.
Respectfully Submitted,
Lauren Rabin
Lauren Rabin, Secretary