Appropriations & Oversight Committee — 2017-06-08

Appropriations and Oversight Budget Hearing

This meeting starts at 0:00 in a recording that covers several meetings.

Attendance

Robert A. Boisselle absent · Ward 4 Alderman; Donald L. Conn Jr. present · President/Ex-officio Member; Scott M. Forbes present · Ward 7 Alderman; Gail Infurna present · Vice Chairman; Jennifer L. Lemmerman present · Ward 2 Alderman; Mary Beth McAteer-Margolis present · Alderman at Large; Monica C. Medeiros present · Alderman at Large; Peter D. Mortimer present · Chairman; John N. Tramontozzi present · Ward 1 Alderman; Francis X. Wright Jr. absent · Ward 3 Alderman; Michael P. Zwirko present · Alderman at Large

Agenda

Minutes

CITY OF MELROSE APPROPRIATIONS COMMITTEE CALENDAR● JUNE 8, 2017 Aldermanic Chamber, Melrose City Hall Budget Hearing 7:30 PM 562 Main Street, Melrose, MA 02176 The public should take notice that the Melrose Board of Aldermen may, on certain occasions, have a quorum in attendance due to standing committees of the Board of Aldermen consisting of both voting and non-voting members. Members attending this duly posted meeting are participating and deliberating only in conjunction with the business of the standing committee. Attendee Name Title Status Arrived Peter D. Mortimer Chairman Present Gail M. Infurna Vice Chairman Present Michael P. Zwirko Alderman at Large Present John N. Tramontozzi Ward 1 Alderman Present Monica C. Medeiros Alderman at Large Present Robert A. Boisselle Ward 4 Alderman Absent Francis X. Wright Jr. Ward 3 Alderman Absent Mary Beth McAteer-Margolis Alderman at Large Present Jennifer L. Lemmerman Ward 2 Alderman Present Scott M. Forbes Ward 7 Alderman Present Donald L. Conn Jr. President/Ex-officio Member Present

ORDER-2017-148 Amending Revised Ordinances Amending Melrose Revised Ordinances, Chapter 228-14 Water meters by adding a new subsection C as set forth herein. Recommend Passage Board of Aldermen

ORDER-2017-146 Amending Revised Ordinances Amending Melrose Revised Ordinances, Chapter 228, Article II, Section 228-15 (Water Rates Established), as set forth herein. Recommend Passage Board of Aldermen

ORDER-2017-147 Amending Revised Ordinances Amending Melrose Revised Ordinances, Chapter 228, Article IV, Section 228-30 (Sewer Rates Established) as set forth herein. Recommend Passage Board of Aldermen

ORDER-2017-172 Transfer A Transfer in the amount of $15,000 from Memorial Hall Salaries (016931- 511000) to Memorial Hall miscellaneous supplies (016932-530501). Recommend Passage Board of Aldermen City of Melrose Page 1 Updated 6/27/2017 1:23 PM Minutes Appropriations Committee June 8, 2017

ORDER-2017-140 Operating Budgets (City, School, Regional School) City of Melrose Operating Budget for Fiscal Year 2018 in the amount of $77,397,009.19 (Seventy-Seven Million, Three Hundred Ninety-Seven Thousand, Nine Dollars and Nineteen Cents) Appropriations Committee

ORDER-2017-171 Transfer A transfer from various Public Works Salary accounts to various Public Works Salary accounts as set forth herein. Recommend Passage Board of Aldermen

ORDER-2017-175 Authorization Authorization to appropriate $60,000 from: Fund 3376-Fire Station Roof Bond to: Fund 3382 - HVAC Repairs Recommend Passage Appropriations Committee

ORDER-2017-173 Appropriation An Appropriation in the amount of $160,000.00 from FY14 Overlay Surplus (01- 123014) to Public Works, Drain Design Study (014012-529026). Recommend Passage Board of Aldermen

ORDER-2017-152 Appropriation An Appropriation from account 6000-319000 (Sewer Retained Earnings) in the amount of $383,034 to account 6000-330001 (Sewer Reserve of Retained Earnings) in the amount of $383,034 Recommend as Amended Board of Aldermen

ORDER-2017-151 Appropriation An Appropriation from account 6100-319000 (Water Retained Earnings) in the amount of $331,386 to account 6100-33001 (Water Reserve of Retained Earnings). Recommend as Amended Board of Aldermen

ORDER-2017-142 Enterprise Fund Water Enterprise Operating Budget for Fiscal Year 2018 in the amount of Five Million, Two Hundred and Four Thousand, One Hundred and Sixty Three Dollars and Thirty Four Cents ($5,204,163.34). Recommend Passage Appropriations Committee City of Melrose Page 2 Updated 6/27/2017 1:23 PM Minutes Appropriations Committee June 8, 2017

ORDER-2017-143 Enterprise Fund Sewer Enterprise Operating Budget for Fiscal Year 2018 in the amount of Seven Million, Eight Hundred and Ninety Four Thousand, Six Hundred and Two Dollars and Eighty Two Cents ($7,894,602.82). Recommend Passage Board of Aldermen

ORDER-2017-150 Appropriation Appropriation of $220,000 From: City Wide Meter Replacement Water Enterprise (Fund 6155) - $110,000 and City Wide Meter Replacement Sewer Enterprise (Fund 6045) - $110,000 To: City Wide Water Pipeline Improvements (Fund 61352) - $110,000 and City Wide I/I Program (Fund 6095) - $110,000 as set forth herein Recommend Passage Board of Aldermen

ORDER-2017-162 Bond Authorizing a Bond in the amount of One Million, Six Hundred and Ten Thousand Dollars ($l,610,000) under the Water Enterprise System through both MWRA LWSAP and local bond for FY2018 Recommend Passage Board of Aldermen City of Melrose Page 3 Updated 6/27/2017 1:23 PM

Transcript

▶ 0:00 Peter D. Mortimer: Chairman Peter Mortimer, along with Vice Chairman Alderman Gail Infurna, we are joined by Alderman Michael Zwirko, Alderman John Tramontozzi, Alderman Monica Medeiros, Alderman Mary Beth McAteer-Margolis, Alderman Jennifer Lemmerman, Alderman Scott Forbes, and President Donald Kahn. This meeting is being recorded by MMTV and is available for viewing in the future on their website or on the Melrose-Mass website as well. Motion. Motion to vote. Conferring has made a motion to open the floor for public participation. Duly seconded by Alderman McAteer-Margolis. All in favor, please say aye. Aye. Any opposed? Hearing none, we are open for public participation. We are going to have a public hearing later tonight on water and sewer items, but we can have public participation now.

▶ 0:59 Good evening, Mr. Moroz. Good evening. I am certain that our clerk of committee has your address for the record. I don't see a sign-up sheet there, but I think we have your address already. Hi, again, I'm Jerry Moroz. um you know there's a number of articles here tonight that i'd like to comment on and it's even made difficult by the fact that they aren't posted in advance you know i mean i and actually this here says updated june 7th to 4 15 um i don't know what was updated or not but but you know if you know what you're going to have on an agenda well in advance even the basics of it put it up there don't leave it to the last minute that you know things that we don't see you know it's hard

▶ 1:48 to see that um so my understanding is that the public hearing at eight o'clock is in regard to the setting the water and sewer rates for fy18 or just for sending them from whenever forward um um on the agenda there's a number of other things um that as i was looking at something here it looks like that you know mr taymor philip taymor has um has sent you a letter and has published it in the paper as well um and you know i concur with his points and he's done some you know good responsible analysis of of our water system and sewer system and and you know what to me i see that basically the city is making a blatant money grab off of the water and sewer ratepayers and every time we turn around they're

▶ 2:51 grabbing something here there and any which way they can they have in the water and sewer ratepayers paid for the city's use of water and sewer in all the schools and the parks and and everywhere and and now you want to have the water and sewer ratepayers pay for roads now you know that when we rebuild roads we do it in a little responsible fashion that we take a bad road that's already miserable needs to be repaved we do the infrastructure work we have the gas company come in we have the water and sewer work done and then we repave the road nobody can claim i mean except maybe on some you know emergency thing in a brand new road that something goes wrong which you wouldn't expect it to because we just put a brand new water system underneath

▶ 3:29 the road that we just paved to grab 220 000 apparently from the water and sewer enterprise funds claiming it that you know oh we need to pay for paving you know again it's a blatant money grab it's a it's a it's it's it's circumventing prop two and a half in any any way you look at it um the issue of water and sewer earnings retained earnings and reserves basically we've been through this before in other years no one can because there's no responsible way to even claim it that somehow we need to have a reserve fund that in theory for a place that did their water and sewer from top to bottom where they have an aquifer to protect where they have pumping stations filtration plant um you know main aqueducts to get things somewhere all those

▶ 4:31 costs on the water side are taken care by mwra on the sewer side we don't have treatment plants We don't have all kinds of things, even the capital costs of that are all embedded in the MWRA rates. So you complain about the MWRA rates, but now you're throwing on top of that, basically double billing the rate payers of Melrose by making them pay for all that infrastructure in the reserves that MWRA has and paying their debt service and everything else at the same time as you're double charging them for that stuff that we don't even have to do. We won't really have a catastrophe in water and sewer, let alone a natural disaster type thing. But, you know, we don't have, you know, if we have a pipe break here or a sewer pipe break there or something happening there, it's something that we do.

▶ 5:20 We don't need such a huge reserve contingency by any means. And, you know, the representations by members of the city staff regarding these issues I think have been reprehensible. You know, it's fine to have a decent reserve, but here's the other issue, is that if we had our whole system up to snuff, right, and then we wanted to put into reserves a little bit every year to, say, pre-fund capital replacement costs as time goes on, you could make an argument for that. I could make an argument against it too, but you could make an argument for that and reasonable people could disagree. But the issue you have here is you're just sucking money from the rate payers, throwing it in the bank and it's you're not doing anything with it and the fact is is that

▶ 6:09 our sewer system isn't up to snuff our water system isn't up to snuff to put that money there and not use it is it's irresponsible it's it's having money sitting there doing nothing for us and it's in fact it's wasting away because it's being depleted by inflation if we use that money right now and the sooner that we use it the quicker we'd have a return on our investment in having lower water costs because we'd have reduced leakage in the water distribution system and we would have lower sewer costs certainly by dealing with inflow and infiltration which we talked about here a lot but you know nobody seems to get it actions speak louder than words nobody's putting forth any kind of accelerated plan to deal with inflow and infiltration that will actually give a

▶ 6:53 benefit to the ratepayers of Melrose you know if there is money left over from the water meter replacement fund don't grab it for the city side you know a sanitary sewer system and in a safe water system are both public goods and the public as taxpaying entity has has an investment in keeping that up in fact the firefighting capabilities of the whole city network would if you were actually doing a real a real cost analysis of the system you would say that a lot of that would be the burden of the city right but the city's absconding with money from the water and sewer enterprise to fill its own pockets to do its own things that's people in the city you know the money might go to one place but there's other money being spent that certainly could be going to

▶ 7:54 pay the city's bills and I want to highlight some of those things I mentioned earlier the you know there's probably about four hundred and fifty thousand dollars a year that the city of Melrose does not pay in its water bills just doesn't pay it says now we're not going to pay our bill we'll let the rate payers take care of it right the the reserves that you're taking in you just taking them from the rate payers throwing them in something and then certainly you're gonna have a back-end way of pulling them out for some other purpose other than the rates other than dealing for it with the water system on behalf of the ratepayers. You know, when's it gonna end? You know, all these different things, it's as maddening as the fake news, right? You know,

▶ 8:41 people come here and claim, oh we're doing this great thing for the city and all this. All it is is a plain old-fashioned blatant money grab and nobody seems to care. I don't understand why you don't care. You are effectively violating proposition two and a half and violating your fiduciary responsibility to the ratepayers and to the taxpayers by not having the cost of the city paid by the appropriate parts of the city where they belong you all know I could go on and on and on about every issue here and in detail and you certainly don't want that but the problem is is that I come here year after year after year, raise the exact same points year after year after year, and then there's a wink and a nod and, oh, yeah, we're dealing with that.

▶ 9:30 We're going to have a program instead of a something, you know. And it's all meaningless. It's just talk. Nothing's being done that's significant that needs to get done. Time is precious. You know, we have wasted five years now since we were here talking about this in 2012. Five years. And we still aren't using the $2 million sitting near the MWRA has given us for sewer. I mean, we have a plan, but we could accelerate this plan. We could take the millions of dollars that you sucked out of the rate payers sitting in the reserve fund. We could put that to inflow and infiltration and leakage on the water side for sure too. We could have the city start paying its bills and investing that money into making a good

▶ 10:12 sewer system. We are at basically the top of the MWRA, maybe Belmont or somebody else a little bit above of us, something like that, but we are egregious in what we do to our citizens here. You are egregious in what you do to our citizens here by setting the rates that you set. And I know you don't appreciate me saying that, but frankly, how much more blunt do I need to get? I've given you rational argument year after year. I back it up. I give you a presentation that's more than you ever want to see to know the theory behind what I'm saying, and you just deny it and walk away and say, oh, well, we'll just vote unanimously. Let's just go and do this you know somebody's got to stand up here alderman medeiros does occasionally come here

▶ 10:54 and say there's a problem here the issue of the indirect costs that alderman medeiros raised last year is a huge issue you know when i saw the half of the city solicitor's salary is being paid by the water and sewer fund last year that just that just broke it for me it's like how ridiculous is that the city solicitor is not spending half his time on water and sewer issues i'm sorry and if he is there's something else broken in there that somebody ought to be looking at and the board of aldermen should be doing that you know we will get well in the terms of the budget of the water and sewer department i'll get to the rates later on when we when we speak about the rates but the budget basically isn't real it's a fake budget and and all the smoke and mirrors

▶ 11:40 that the city has they put up there every year and they change them around and oh well oh we're We're not going to raise rates this year. Well, hello, we double charged everybody last year, and now we're only going to one and a half times overcharge them this time. And oh, we're doing a great thing because we're not raising the rates. Now, I know Mr. Mortimer wants me to stop, but you know when you'll- Mr. Moroz, I insist that you stop. You've taken your ten minutes, you've been very vociferous, we've waited patiently. Is the vociferousness the problem, is that what you're saying? You're going to get another chance to talk. Do not argue with me, or I will not let you speak later. Thank you. Now please step back.

▶ 12:22 Peter D. Mortimer: A motion to close public participation. Alderman Forbes has made a motion to close public participation. Second. Duly seconded by Alderman Zwirko. All in favor, please say aye. Aye. Any opposed, hearing none, public participation is now closed. The first order we have before us is order 2017-172. A transfer in the amount of 15,000 from Memorial Hall salaries, five one zero zero zero to memorial hall miscellaneous supplies zero one six nine three two dash five three zero five zero one alderman's worker was made a motion to suspend the rules that we may hear it's duly seconded by alderman inferna that we may hear from the director of memorial hall miss pickett broda good evening miss pickett broda how are you

▶ 13:13 Peter D. Mortimer: not bad thank you please proceed hi just I'm just transferring money out of salaries to buy some cleaning equipment to make it easier for my staff with the increase in events at the hall it's been increasingly difficult to clean and to reset the hall so I'm looking into buying a couple of floor machines for my staff right now they're mopping it by hand thank you very much in fact let me read the order for which we suspended the rules it's order 2017 i read it you did never mind thank you thank you very much alderman inferno um are there any aldermen who have questions or comments please uh seeing none is there a motion please second alderman MacMaster margolis has made a motion to recommend this order for passage to the full board duly seconded by alderman

▶ 14:08 Peter D. Mortimer: Medeiros was it alderman forbes thank you very much thank you very much and uh all in favor please say aye aye aye opposed hearing none that order will be recommended the pool I know you have business over at Memorial Hall fifth grade Horace man is it fifth grade Hoover tonight excellent thank you very much the next order we have before us is returning to the budget it is order 2 0 1 7 dash 140 city Steve Melrose operating budget for fiscal year 2018 in the amount of $77,397,009.19. This is the budget that we've been working on for a few months now, a couple of months now. And the first budget we will address this evening is budget 145. it is the treasurer collector in the amount of 407 296 dollars and 32 cents good evening mr flavin

▶ 15:16 how's everybody good evening um this is my annual trip for my budget and at the risk of repeating myself um this is groundhog day it's kind of sorry for you guys they have to hear the same thing over and over again but this budget just doesn't change this is the operation budget we need in In order to collect all the money, invest all the money, just the day-to-day routine. There's nothing, there's no big changes. It's just, I'll entertain any questions, but we've been doing the same thing for years. Basically the same amount of money. Thank you, Mr. Flavin. First in queue, we have Alderman Forbes, please. Thank you, Mr. Chairman. I just noticed the one item with increase in salaries, is that contractual?

▶ 16:02 Yes, and also there's a, we re-institute, we have a clerk that we had taken off the roles four or five years ago because we didn't really, we did a consolidation with the advent of the monthly water sewer billing. We introduced an 18-hour clerk back in. If a 30 percent participation rate occurs on the monthly billing, it's going to result in over 25,000, 26,000 more bills that we'll have to process, more phone calls we'll have to deal with, more explanation we'll have to deal with. So rather than start with the whole new staff, we came in conservatively with the half person. There's no benefits involved with it, and they will go to help support the staff with the additional workload. MR. Thank you very much.

▶ 16:56 Peter D. Mortimer: Thank you, Mr. Chairman. Thank you, Alderman Forbes. President Kahn, please. Yeah, Mr. Flavin, are all of your departmental salaries reflected in your budget? Yes. So there's nothing that's budgeted anywhere else in the city budget off your salary and wages for the treasurer's office? This is all out of the- Correct. Okay, good, that's all. Thank you, President Kahn. Is there a motion, please? Motion recommended. Second. Alderman Forbes has made a motion to recommend this budget to the full board for passage. duly seconded by Alderman Inferna. Seeing no further discussion, all in favor, please say aye. Aye. Any opposed, hearing none, this budget will be recommended to the full board for passage.

▶ 17:35 The next budget item we have before us is number 711, municipal debt in the amount of $3,734,909.00. Please continue, Mr. Flavin. This is the debt that is due on the exempt side, principal amounts to on the exempt in the regular general fund debt for all the projects that we've done in the last few years and past and these are the obligations that we committed ourselves to and you should have a detail that was provided with you that breaks out what projects they are and what the amounts are for each one Thank You sir president Conn please yeah so mr. Flavin the the The general fund debt is in budget 711, 751, and 752, is that correct? That's the interest in the principal and- Yes. So what you referred to as general fund debt is-

▶ 18:36 The muni debt part? Right, those three budgets. So the debt in the general fund is 5,597,145. But there's nothing else in the general fund debt other than those three items, is that correct? I'm not sure I get the five million. Well, what I did is I added up your municipal debt, 3734909. Debt interest 1491386, and projected debt- 370. Which is 370, which is short term borrowing. Right, but broken out general fund debt, but part of it is exempt debt for the tax exemption for the school when you did an exemption debt. That's the second line on each one of those reports, the first two reports. Okay, so well, maybe I mischaracterized it. So in the budget, we're funding $5,597,145 by my calculation.

▶ 19:37 Correct. And then, if we go back to the cherry sheet, it shows us what our total debt is on the cherry sheet, which is $61,987,06. And my question was, for next year, the 5.5 million will be Added to the 61 million that appears in this year's summary, is that correct? I'm not sure what cherry sheet number you're talking, are you talking about this report? I'm talking about the last page where it says total debt, and it's $61,897,006. Last page of? Of the financial analysis from the Department of Revenue. I'm not familiar with that. But we'll be adding debt, we do every year. Okay, so if you accepted my hypothetical that the debt that's listed is $61,987,600. This new debt that's going to be part of the budget for this year will be added into that compilation for next year.

▶ 20:57 Not the total amount, because the stuff falls off too. Okay. mean for the difference between 18 the difference between 17 and 18 will be adding 22 22 000 19 we take a hit we add 365 000 because the high school stuff goes on it's cumulative so from last year to this year we're adding 22 000 because some stuff the new stuff and we didn't really issue anything in november we're waiting till this year for the leds lights and those types of things we time this stuff right so now the three next on 19 because we'll be doing november we'll it'll be 300 it's anticipated 365 000 more will be added to that number okay so so the total city debt on that schedule will increase by some portion of this 5.5 million that's in the budget for this

▶ 21:47 year yes and i would you're looking at the total outstanding debt inside the debt limit and outside the debt limit and there's a whole bunch of numbers there i can answer that yeah i mean you know you you know i like obstinately cling to this this concept and um but all right that's all i have thank you thank you president khan next in queue we have alderman Medeiros please thank you um thank you very much mr flavin you you mentioned that you had uh provided us with a uh breakdown is is that the statement of indebtedness that's one of the things no it's um you get it every year it looks like this okay it's uh it's the detail of it's the detail of the numbers it breaks everything out on that end which attachment is that mr chairman in the uh in today's agenda

▶ 22:37 Monica C. Medeiros: scan down i read them all but i was having a little difficulty finding it so in this particular uh department agenda there's two line items municipal debt and then exempt principal i'm sorry in this particular budget there's two line items uh municipal debt and exempt principal exempt from this particular one yes principal general fund principal exempt and so we're seeing a decrease in three point percent seven percent in the municipal debt but the exempt is has increased fifteen percent that's what if that's what it says i mean these are schedules that i mean these are obligations these are notes that we read right off of an amortization schedule and what it is is it 15 sounds high because i mean when you look at it yeah this is this is something

▶ 23:40 that was voted that's right it's on the other thing yeah percent change i mean yeah it's a real one it went from 125 1125 to 1295. is this uh and that's you know what that is is that's because we use level debt this is on the principal side i think if we look at the interest side you're going to see a reduction of 21 percent i see because they group the payments it's like a car payment principal and interest and the oldest something gets the more principal you pay and the less interest less interest okay thank you that makes that makes a lot of sense and uh perhaps uh mr chairman did you have the i was just looking through the documents i mean you can look through them as well as i can yeah so i don't i didn't see it i know he had referenced it

▶ 24:25 so i was hoping we could make that part of the record if it isn't already here all right um page 91 in the packet page okay yeah today right now yep but thank you i was looking page 91 in the package attachment packet page 91. thank you very much alderman forbes you will you know i of course can't seem to find a page number here in my look at the one alderman's worker please on iqm2 i believe it's uh letter d page 13 of 15 if that's helpful thank you alderman's worker letter d seems to be the statement of indebtedness if you go to page 13 that shows all long interest debt thank you long term excuse me yeah okay good so if anybody watching at home very good thank you you can catch right along with us thank you so much thank you

▶ 26:02 Peter D. Mortimer: are you really pushing the floor yes i am thank you thank you very much alderman Medeiros i'm seeing no further alderman wishing to be heard is there a motion motion to recommend so we we have a a motion to recommend this portion of the budget. Second. Duly seconded by Alderman Zwirko, made by Alderman Forbes. All in favor, please say aye. Aye. That budget will be recommended to the full board. The next budget we have before us is budget 751, municipal debt interest in the amount of $1,491,386.84. Please continue, Mr. Flavin, we can proceed to the colloquy this is um the interest associated with the principal payments represented in the previous budget it's a it's an obligation thank you very much sir any alderman

▶ 26:55 Michael P. Zwirko: wishing to be heard on this item signal is there a motion just a quick question yes go ahead since this is um the interest obviously as you mentioned just your analogy which is easy to understand like a car payment or a mortgage is this generally our this is so this is our annual interest payment on the debt that mr alderman khan referenced earlier on the total correct even though it's a sliding scale because there's various uh it's the interest on the general fund debt and the exempt debt that 56 million or 60 million may include water and sewer which ultimately are obligations of the city but they're in a different budget understood thank you thank you alderman Zwirko motion to recommend we have a motion to recommend the municipal debt interest portion of

▶ 27:42 Peter D. Mortimer: the budget by Alderman Forbes duly seconded by Alderman MacMaster Margolis all in favor please say aye aye any opposed hearing none this portion of the budget will be recommended to the full board for passage the next item we have before us is budget seven five two it is projected debt in the amount of three hundred and seventy thousand eight hundred and fifty dollars this is debt that hasn't this is temporary debt that's been issued for previous projects we typically will temporary borrow for a while to see how it spends or so and in other times we'll borrow to take advantage of the rates at the market but these are bands for the high school interior construction of window replacement renovations and a number of other smaller things the LED streetlights are still

▶ 28:34 on here as a band this is a band we took out last November that comes do this November when we'll bond it that's one hundred and sixty seven thousand six hundred dollars when we bond in November we owe an interest payment in May every six months we have to make a payment on the right is I mean there's projected interest bond payments in May of two hundred and three thousand two $850 on all of these same projects that comes to the total of three hundred and seventy thousand eight hundred and fifty dollars Thank you. Mr. Flavin Alderman Forbes, please. Thank you. Mr Chairman, so in essence these that this is just a placeholder for the projects that have come down the line Am I correct in saying that almost like you'd say like a deposit on the work that's going to be done in a future date

▶ 29:15 So you can secure the money and then go to bond later on. It's it's borrowed with an obligation And it's a temporary one year note, and then in November it becomes whatever maturity the different project has. Sure. Some will be 15, some will be 10, some will be 20. Okay. And so it's, yeah, it allows us to do the work before we make the long term commitment to the bond. Right, money out and then money back in. Right. Okay. Yeah, it's in and out. Yep, thank you Mr. Chairman. Thank you Alderman Forbes. Motion to recommend the bottom line. We have a motion to recommend the bottom line on projected debt by Alderman McAteer-Margolis, duly second by Alderman Forbes. Seeing no further discussion, all in favor please say aye.

▶ 29:57 Peter D. Mortimer: Aye. Any opposed? The projected debt portion of the budget will be recommended to the full board for passage. The next budget item we have this evening is 916. It's the Medicare City portion in the amount of $680,000. Mr. Flayman. This is another Groundhog Day item. We talk about this every year and we hear it, this is the obligation, this is our obligation to the IRS. 1.45% of all salaries that we have to match, we take 1.45 out of the employee. We have to match it, it's an IRS obligation, we have to do it. You'll see there's a $30,000 increase from last year. You'll also see the agenda for Monday, we're coming in, we need 42,000 more for this year. We try to put a number on it based on what the salary is, projections are times 0.0145%,

▶ 30:51 Monica C. Medeiros: but we can't control things like excess overtime, contract settlements and retro payments, those things can't be anticipated, so we end up in that situation where we have to. I end up here every year looking for that money, because it's not something, we know we're doing that, but I don't want to overload it and not have the money be spent somewhere else where it needs to be. So this is our best guess of where we'll be next year for this. Thank you very much, Mr. Flavin. Alderman Medeiros, please. Thank you, and I see we previously had salary, active salary in this line, and now it's no longer there. Could you talk a little bit about that? I don't know what that means. I think we had a position funded last year.

▶ 31:38 Monica C. Medeiros: We had $23,846.95 funded in this budget, and this year we have zero. I'm not familiar with that. This is usually just one number. It looks like the actual 2017 actual was $18,255.86 spent. Are you looking at 916? I'm a maybe I'm it's been one of those days no that's that's that's one it's from one of these days today that I forgot about everything since I lost myself out of the office and out of my car so this is just another one of those things so thank you very much okay that's why that doesn't make sense thank you Thank You alderman Medeiros alderman MacMaster my goals please and mr. Flavin just to clarify this is just municipal employees it does not include the teachers and it doesn't it doesn't

▶ 32:40 Peter D. Mortimer: include the teachers so even though the teachers have their own retirement plan we are still obligated to pay this is this is Medicare oh it's not so scary so it is Medicare so it includes all employees in the cities even the teachers absolutely great Thank You alderman MacMaster my goal is seeing no further alderman wishing to be heard alderman's work oh has made a motion to recommend this budget to the full board second we seconded by alderman Forbes all in favor please say aye any opposed hearing none this budget will be recommended to the full board I think your business with us this evening is concluded mr. Flavin thank you thank you for your attendance Have a good one. You as well, sir.

▶ 2:09:11 Peter D. Mortimer: vacancy exists results in surpluses in some places and deficits in the other this is not appropriating any additional funds to the 17 budget is just moving salary lines around thank you sir is there a motion question or comment Second. Alderman McAteer-Margolis has made a motion to recommend this order to the full board for passage, duly seconded by Alderman Forbes. Any further discussion? All in favor, please say aye. Aye. Any opposed? Hearing none, this order will be recommended to the full board for passage. The next order we have before us is order 2017-175. Authorization to appropriate $60,000 from 3376 fire station roof bond to fund three three eight two HVAC repairs mr. Shana please thank you these funds were originally borrowed

▶ 2:10:08 pursuant to order 2015 142 to pay for our municipal building renovations and repairs slated for the central station roof we made emergency repairs to that over the last year they're holding with the ongoing feasibility study of all of our public safety buildings this money became available and we have another emergency need at our library if i may through the chair i have a letter from director of the library linda linda gardner i'd like to just read it into the record and i'll forward it for the forum for the file please proceed members of the board of aldermen i'm writing in support of order 2017-175 before the board of alderman this evening the library's hvac chiller which is almost which is over 21

▶ 2:11:02 years old has become increasingly unreliable over the past several years i have been informed that hvac vendors have recommended no further money be put into repairs for an end-of-life piece of equipment having an effective HVAC system is essential in our public library for our special collections our staff and our patrons the most recent professional preservation assessment identified the HVAC as an area for improvement because of adverse effects on unique historical Melrose maps and documents the library serves as a place of refuge in extreme weather offering a pleasant break in the day for families and a shelter for populations at risk the current system is already unable to maintain comfortable levels and very

▶ 2:11:52 high temperatures if the chiller breaks down completely we would have to close the library during some of those days which would have a negative impact on both our collections and our daily services to the community John's generous DPW staff have done their usual thorough job of investigating this challenge and possible solutions it's my understanding that the proposed new chiller would be compatible with the proposed renovations possible through the anticipated MLBC construction grant for this reason and the adverse effects of not having a functional HVAC system in the near future I am strongly in favor of this proposal I thank you for your time and your consideration just to back up some of the statements miss Gardner we we have been struggling which

▶ 2:12:43 with this chiller for a few years now our in-house HVAC technician has literally worked work magic last year to keep it running we turned it on when we got that brief warm spell seems centuries ago but was a month ago and the main barrel of the unit is leaking the parts are very difficult to find the refrigerant is so old it's very expensive what we did is we contracted with Griffith and very they're the they're the mechanical engineer that tap a who's looking at the renovation project is working with and we asked him for his opinion he looked at repairing it he looked at possibly bringing something from a school over with you know a three to five year shelf life in this this way we would bring it over set it up buy something new for a school and when that project

▶ 2:13:35 Michael P. Zwirko: came forward addressing at that point and then we also looked at addressing it now with the needs for the future they recommended the third option of purchasing a chiller today that can be retrofitted when that project happens um we feel very comfortable with their recommendation and it's a need that again we we would like to address with this transfer of already borrowed funds thank you very much mr. Shana first in queue we have alderman's work oh thank you thank you mr. chairman I just wanted to address two points in the letter that I'm appreciative of and I will be supporting this at the very end of the letter you stated that this will be compatible excuse me miss Gardner stated that this she's under the understanding this would be compatible should we not

▶ 2:14:24 Michael P. Zwirko: only received the library grant that we applied for earlier this winter but also should that project be funded so I'm very pleased to hear that because I don't want to just put money at something that's temporary and this will be a long-term fix for the issue I will also note that I believe it was you mr. Shannon not miss Gardner it might have been I apologize if I'm incorrect but they stated that the library can be used as a refuge during periods of hot weather weather I know that when we have had heat waves here in the city through outlets public outlets the mayor's blog and the like library is one of the places that we do open up as a cooling station so I agree with that so I'll be pleased to support this order and I think that this is using the funds that

▶ 2:15:11 Scott M. Forbes: couldn't be used elsewhere it's a good use of these funds Thank You mr. chairman is that a motion all the ones were a motion to recommend a motion to recommend this order for passage by Alderman's work Oh Dooley second by alderman forbes seeing no further discussion alderman forbes please yeah one question uh anna stable i'm glad we looked at three options instead of just one so we can kind of look at it from all angles um one question is the sixty thousand dollars do we get an estimate on is that how much it would cost for the new unit yeah we didn't hear anything in the letter saying how much it actually would cost the opinion the probable cost is 52 000 material and installation plus soft costs so the sixty thousand dollars once we value engineering and we get some competitive

▶ 2:15:53 bid it should be enough to address the issue and we're going to move on it quickly as soon as this order comes out of the full board so that way we can protect ourselves for the summer all right net eight thousand dollars gives you around a fifteen percent buffer in case you go into any overruns exactly okay thank you mr chairman thank you very much uh alderman forbes next in queue we have alderman Medeiros are you signaling that you risk to uh pass i'd like to let uh president khan speak who's been a little bit first if you don't mind uh that's that's fine uh you'll yield the floor to president khan president khan please proceed thank you do we have any more money that we borrowed for the fire roof repair that we haven't expended we have we

▶ 2:16:33 we'll have about seven to eight thousand dollars left in that account that we recommended stay in there for the next six months to buy us a another winter of emergency repairs is this is this account encumbered for the purpose of fire repairs it's for um it's it's a bond right so i would assume that it can only be expended for the purposes set forth in the bond right which is why we're requesting reauthorization so it isn't covered it can't be used for anything else okay that's Thank you, President Kahn. Alderman Medeiros, please. Thank you. Yes, although I'm reluctant to, you know, move funds from something that's already been designated for a specific purpose, obviously this is definitely a need. It's also another capital repair, and I think it would be an appropriate appropriation.

▶ 2:17:26 Monica C. Medeiros: I'm wondering if this new change in the HVAC system will actually possibly result in any energy savings? Because I know the new equipment is often more efficient than—how old is the current system at the library? Twenty-one years old. Twenty-one? Yeah, I mean, systems, the chillers today run much more energy efficient. i don't have the specs i'm not an hvac personnel but everything runs a lot more efficient today it'll probably be capitalized when the inside air handle is and everything else gets changed with it when and if there's a renovation but um we this would this will become more energy efficient oh that's good i i hope that's the case and as was said before the library certainly is a refuge for

▶ 2:18:16 Peter D. Mortimer: many people in our community over the summer when it's really hot and very happy that this is something that should we move forward and get this grant and move forward with the library renovation projects that in fact it would be compatible thank you thank you alderman Medeiros there is a motion made by alderman's worker and secretary by alderman forbes to recommend this order for passage all in favor please say aye aye any opposed hearing none this order will be recommended to the full board for passage thank you next order we have before us is order 2017-173 it is an appropriation in the amount of 160 000 from fiscal year 14 overlay surplus account account 01-123014 to Public Works Drain Design Study account number 014-012-529026.

▶ 2:19:15 Mr. Shannon, please. In 2004, Melrose completed a natural hazardous mitigation plan. HMP is the abbreviated term for it. was originally completed with funds from massachusetts emergency management agency natural hazard mitigation is any sustained attempt to lessen the impact that a natural hazard poses to life property infrastructure or other valuable resources the plans that the study aims to mitigate the potential impacts of natural hazards through preventive actions in the forms of policies community programs but most importantly targeted capital projects that look at minimum minimizing the risk of impacts of such events this is the program that allowed us to apply for FEMA funding which brought us the El Pond drain

▶ 2:20:16 project it brought us the converse Lane project two projects that really changed Melrose for the better and changed and gave us opportunity to do so much more so the the the the program is out of date and in order to reapply for other FEMA possible possible other FEMA funding we have to update this plan so part of the funding is going to be used to hire a consultant to work with our engineers and the team from the community at updating this we're also adding a climate control piece of it with Martha Grover she applied for a grant and we found out this week she also received a $19,000 grant to look at climate natural disasters and how we would respond to those as well and that would be incorporated in the study when the study is completed we forward it

▶ 2:21:13 along to MEMA and FEMA and then we're open to start applying for grant programs to address projects that this program identifies that's the first part the second part is to to enter into phase two of the El Pond FEMA map review so over the last decade we've naturally made several substantial improvements to the drainage in the vicinity of El Pond we this past fiscal year our city The engineer and CDM initiated a study to evaluate whether base flood elevation shown on FEMA's flood insurance rate maps could now be lowered as a result of all the work that we've done. The results of that phase one contract were very positive. And what this does is allow our engineering staff, together with CDM,

▶ 2:22:10 with the residents in that area to collect the data to finish the engineering analysis to try to attempt to lower the lower their insurance costs by changing these flood maps the last component of where the funding is going to be used for is the ms4 permit I think some of you have heard for two three years now that stormwater quality regulations were coming down from the federal government to states and are we going to do it are we not going to do it we're going to do it no we're going to freeze it it's a draft permit the reality is that that is that could be coming within the next year year and a half so what we're trying to do is prepare the department for for this start to institute some best best management practices within the department in terms of

▶ 2:23:02 stormwater quality where our outlets are maybe testing some outlets for stormwater qualities and prepare us for this ms-401 and if it hits to take the initial curse and financial financial risk it could bring the city out of play so that's what the funding's for we're very fortunate that we'll be able to transfer these funds the auditor created this funding source so that we can start these programs in the next fiscal year um they'll all be based out of our engineering office thank you mr shenna our first in queue we have alderman inferno please thank you very much mr chairman i just want to take a moment to thank you for pursuing this and i certainly will support it i know my constituents down in the congress lane area

▶ 2:23:52 really benefit from the program back in 2004 and and whatnot and and they've been very satisfied with the drainage down there so this is great that we're just going to be continuing to you know initiate new programs and and bring continue this work so thank you very much thank you alderman inferna next we have alderman Medeiros please thank you um two parts here one is the some comments on the the overlay account and I guess and maybe if our auditor could come up so I can try and explain to the public what the overlay account is but I'm sure you can do a much better job try thank you for the chair what happens is each and every year are required to set aside a certain amount of money relative to that fiscal year so that if someone comes in and seeks an abatement

▶ 2:24:54 or entitled to an exemption, that's where we draw the money from to pay them the abatement, et cetera. What happens is that as the years go by, there's money left in those particular fiscal years. asked the Chief Assessor, if there's any fiscal year, do you have available funds, i.e., because A, there's no cases pending there in that fiscal year that may have to be paid from that money, and B, if not, then what happens is this money would be released, what they call available, and if not used by the end of the fiscal year, it would simply go to the general fund. That's a great question, though. So it pays for the abatements when people come in and seek an abatement. and have we expended all the prior years overlays accounts prior to fy 14 um where we we have

▶ 2:25:47 Monica C. Medeiros: balances in the different years and i i asked the chief assessor and he's releasing just this because apparently there's pending cases that until he feels they're resolved that he rather you know he needs to have that still still available yeah okay thank you great question thank you um i just uh and then on that's it thank you very much on the merits of of this and i'm you know i'm very pleased especially that you know people who have found themselves needing flood insurance you know have had extraordinary increases in their their premiums over the last few years and it's been you know in some cases it's been it's really been extraordinary and as a board of aldermen in a little city there's something that was really decided upon on the federal level it's

▶ 2:26:40 Monica C. Medeiros: it's been something that you know we really felt that maybe we could never have any impact on so to be able to do this and to have done this work and hopefully change the flood zone so some people aren't are no longer in the flood zone area based on the work and the investment that this community has made in improving the drainage and everything at El Pond and throughout it's it's a good feeling to be possibly a part of that thank you Thank You alderman Medeiros president Khan please yeah you know these overlay accounts are not anything that we ever see as part of any kind of budgeting process and they're maintained from year to year and we haven't had a transfer out in a number of years what I what I would like if it's possible is I'd like to see how

▶ 2:27:38 Peter D. Mortimer: many years are still open and what the balances are because we this is not It's not something that we generally oversee or have any knowledge of, so I'd like to see what the status of the various overlay accounts is, please. Thank you, President Kahn. Motion to recommend. We have a, I'm going to, Alderman Forbes is in queue, but we can take your motion first. We have a motion to recommend from Alderman McAteer-Margolis, duly seconded by Alderman Forbes, who is now next in queue on discussion. proceed alderman forbes thank you mr chair and so the 160 000 is basically a city-wide engineering project am i correct in saying that drainage drainage drainage drainage i would uh who did our who did our engineer was it meridian last year is that the same would do you have a company that

▶ 2:28:39 would be coming in or is it all cdm is doing the fema piece because they um have the background experience on the l pond project i think our city engineer is going to actually solicit some quotes for the um the hazardous mitigation piece although cdm did the original so they may have a competitive edge but that's that's what those are the other two the the last component the ms4 is in-house we may we may consult with uh we may bring in a consultant to start to prepare us but um for for some best management practices but a lot of that stuff will probably be in-house okay and then uh out of this hundred and sixty thousand i know you said el pon is one of the projects but are there do you know or have identified other high priority areas within the city that they would

▶ 2:29:28 be looking at are there numerous ones or is there just a couple of ones can you kind of expand on that so they look at areas where mother nature impacts and they look at areas um areas of flood they look at areas um and now now with the climate piece they'll also look what drought conditions will do what extensive heat will do what extensive heat that leads to power outages would do those are the types of hazards that they we try to identify with the study um right now there's there's there are components to the drainage system that runs through the wyoming cemetery that comes to mind and um that's exactly where i was going with that yeah i mean that's that that's an issue it's an issue for six that that little neighborhood of four to six to eight residents

▶ 2:30:19 if the study can identify that and can identify the hazards that exist when that intersection floods because of improvements in the cemetery i mean we have a stud we have a project um to improve drainage in the cemetery it's it's with since at least three quarters of a million dollars that could be something that we could apply for funding for once the study is complete with fema or mima so i mean there are still projects out there maybe they're not as big as the four or five million dollar el pon projects but there's still projects that make different a difference in people's day-to-day lives so we want to try to find them we want to try to identify them in the study and then we want to try to seek funding to actually go out and complete

▶ 2:31:00 Peter D. Mortimer: some of them great i know all my friends and neighbors out at the linwood ave sylvan street lebanon street area will be most pleased with that news thank you mr chairman thank you alderman Forbes and on this order a motion to recommend for passage has been made by Alderman McAteer-Margolis and duly seconded by Alderman Forbes seeing no further discussion all in favor please say aye opposed hearing none this order will be recommended to the full board for passage the next order we have before us is order 2017-152 it is an appropriation from account $6,000-319,000, sewer retained earnings in the amount of $383,034 to account. $6,000-33001, sewer reserve of retained earnings in the amount of $383,000.

▶ 2:31:57 Peter D. Mortimer: Motion for concurrent action with order 2017-151. Second. $334. President Kahn has made a motion to act concurrently with this order just read in order 2017-151. It is an appropriation from account 6100-319000 water retained earnings in the amount of $331,386 We'll count 6100-33001 water reserve of retained earnings. The joint orders are before you. Is there a motion, question, or comments? President Kahn, please. Yeah, Mr. De La Russo, can you tell us what the balances that were certified are in the fall on the two reserve funds, please? Thank you. well i may share to all the cons question um this is the information transmitted to this to the city from the department of revenue dated 10 27 2016

▶ 2:33:34 and they indicate what's before you um the first is the water free cash 331 386 and to the right the SOAR 383034 so that was certified by the Department of Revenue Division of Local Services sir so what we would be transferring now is the free cash that was certified last fall that that's correct but then this fiscal year so it's always the year behind and what do we anticipate that we're going to have for free cash in these two accounts for the fiscal year that we're in. In other words, will we going to end up this year? Yeah. What's your projection as to what's going to be certified in October of 17? I can't make a determination at this point because a couple of things. One is that it's a little bit early per se, only because we still

▶ 2:34:34 have two billing periods plus that haven't been received or in transit. And secondly is that I can't, it's not the same as it was the year before, because we have a whole new system. We started in October now, so we lost three months. I can't do apples to apples. I can better probably forecast that next year. But the objective this year is, again, is not to have a deficit in either fund, and hopefully to end up with a small surplus if possible. But we'll know better as we go through, I can- How are our numbers running right now in the two funds? There should be a report for 531, I don't know if you have that, John, for the end of May. Thank you. As of 531, in short, the soil revenue is a negative 183,349,

▶ 2:35:52 and the water is a positive $13,550 as of 5-31-17. And this chart, which the board obviously can see, talks about consumption being up about 2.3% from the prior year. But that's where we stand as of the end of May, Alderman. Okay, so if these two waters pass tonight, we're going to have $735,000 in change in our water reserve. and 887 000 in our sewer reserve that's correct and then presumably we're going to have additional monies for this year that will be certified in october and we'll add to these two totals that would be a a great expectation and a hope of mine too yeah and i mean since 2013 we've had a surf we've had a surplus in every year so it it looks like we could have potentially a million

▶ 2:36:53 million dollar reserve in each of these funds by next fall. All right, well Mr. Chairman, not to be a horse that died last year, but. You know, this was my concern. I wanted to use the reserve funds to hold rates down and to fund the budgets. The board in its wisdom disagreed with me. I understand that you have to have reserves I don't think we need to have a million dollars reserves in each of these accounts and that was the basis of my thinking last year I haven't changed my mind this year but I will listen to the discussion of my colleagues thank you very much president Kahn aldermen's work oh please followed by Alderman Tramontozzi thank you mr. chairman I want build off of what alderman khan just stated and uh help me here a little bit mr del russo if you

▶ 2:37:56 Michael P. Zwirko: don't mind so this variance essentially uh if if we approve the free cash allocation that's proposed the adjusted balances will actually be over 10 the 10 goal in water by 123 538 dollars 88 cents and over the 10 goal in sewer by 16 427 dollars and 23 cents is that correct that's correct so why don't we then appropriate what hits our target of 10% which would then give us about a hundred and forty thousand dollars in total variances in both accounts for expenditure elsewhere I mean why are we going over the goal a couple things one is we're trying to make it a multi-year program because if you if you allow that to happen it's going to reduce the chance you're going to have to raise any reserves in fiscal 19 so that wouldn't have to be raised in

▶ 2:38:46 19 secondly is that it should you decide only to appropriate the 10% which is totally in your purview then the remainder would flow at the end of the year to pool cash for both water 123 538 would go to water pooled cash and saw a pooled cast 16 427 23 and in a portion may translate into free cash for the next year in the fall so you're just pushing it forward the year so it's up it's up to the boards obviously and uh again uh uh we have met the ten percent and it's the board's purview those are all the questions i had at this time thank you very much alderman Zwirko alderman Tramontozzi please thank you mr chairman um just so i understand it if we don't if we do not approve this order what happens to these funds

▶ 2:39:45 Through the Chair, the Alderman, what happened is that the amount that you have in reserves right now, 404.07768, 493.763.93 is what you would have, period, at the end of June 30th. The free cash that's sitting there would flow into pool cash and go towards next year's free cash determination. is it so it does is this in the enterprise fund or is this in the general funds oh all enterprises they're always segregated totally segregated enterprise it can only be used water and so all dollars come in here strictly for water or so a period can't be used for general fund so what can those funds then be used for reducing rates and other things well again um once they're certified because they would have to get recertified in the fall and um quite often you

▶ 2:40:39 Monica C. Medeiros: don't get dollar for dollar because sometimes there's offsets if you know what i mean um but then once it's recertified then you can use it for other purposes in the fall such as uh repairs if they become necessary absolutely absolutely in fact you have right until the next june 30 that you do that if you'd like you have a whole year all right thank you Thank you, thank you very much Alderman Tramontozzi, Alderman Medeiros please. Thank you, and I've had lots of discussions over many years about reserves. And I definitely have had concerns about taking so much money just to sit in a fund where it could be used to either reduce the rates or just not collect it from people who sometimes don't even live here anymore and

▶ 2:41:31 Monica C. Medeiros: ended up paying to to raise this money but that being said I just want to point out that the number that we're using and it took me a minute to figure it but just so everybody here is kind of aware too that the number that we're using for the FY 2018 budget amount is not the amount that we see in our FY 18 budgets but it's really in fact the amount that we're looking at from the the items including the indirect funds and everything they'll match up to those numbers from what mr. de la Rousseau had handed out to us so you know I I just want to make sure that when we were I think when we were first discussing way back when going to a 10% reserve of the budget I shouldn't speak for other aldermen but I think that the consensus at the time was thinking that we were

▶ 2:42:30 Monica C. Medeiros: talking off the budgeted numbers so this is in fact not just 10% of the budgets themselves but also 10 you know this this calculation that we're seeing that has the variances in a you know abundance above the ten percent of one hundred and twenty three thousand five hundred thirty eight dollars in water and sixteen thousand four hundred twenty seven dollars in sewer is actually based on the budgets plus the indirect cost for the overall water sewer thank you thank you Alderman Medeiros Alderman Forbes please Thank You mr. chairman so So we got $140,000 in surplus money, give or take, right? Correct. We'll call it surplus money. Now, what I want to go back to is what you indicated in the first part of your conversation.

▶ 2:43:19 Scott M. Forbes: Because you said as of 5-31, water was at negative 183,349? It was negative of 180, that's correct. All right, and then sewer was a positive 13-5. So if you combine both of those together, as of 5-31, we're at negative 170,000 if I just round it is your indication of putting these surplus funds here to offset that negative number if all things remain equal moving forward no the you talk about the variance yeah yeah no yeah my position is simply that if we put it in the fund now then it's been dedicated to reserve fund it eliminates um two things one is it it's not a direct science 10 is a target it could be 11 could be 12 it could be nine it could be eight but the target of the board was 10 and

▶ 2:44:14 Scott M. Forbes: if you put this additional funds in there you're helping 19 and perhaps 18 in some sense in a different way depending on what happens internally um to have always that 10 goal so to reduce what what you have to raise in fiscal 19 if you don't have to touch anything it's less money you have to raise there because you already raised it here that excess that's what I'm that's the point but it's up to the boy the boy can do whatever they like I mean I know previous consults the two consultants that I've had the experience in chatting with they said they wanted 20 to 25 percent in reserves in which I think is a very unrealistic number in today's budget process so I know we agreed on 10 we've hit the goal on 10 based upon fy

▶ 2:44:56 Scott M. Forbes: 18 if there is a hundred and forty thousand I mean you sprinkle that amongst eighty four hundred accounts I mean how is what would that be if I mean if we were to say choose the option of maybe trying to give the ratepayers back that hundred and forty thousand that that's a minimal you're not going to see a big difference in a water bill are you no and in fact I'm not exactly sure I'm not sure technically how that could be done at this point to begin with. Yeah. I guess my one concern is we agreed on 10%, we hit 10% and now we're asking for a little bit more. Which I don't know, I guess I'm on the fence about that a little bit, but thank you, Mr. Chairman. Thank you, Alderman Forbes. Make a motion to amend the order.

▶ 2:45:46 Michael P. Zwirko: Alderman Zwirko is making a motion to amend the joined orders. Correct. and what would be the uh full substance of your amendment i'm gonna i'm gonna subtract the variance from the free cash allocations in both the water and sewer therefore the water retained earnings amount would be amended from 331 386 dollars to 207 847 dollars 80 cents and the sewer retained earnings would move from I apologize would move from three three hundred eighty three thousand thirty four dollars zero cents to three hundred sixty six thousand six hundred six dollars and 77 cents thus clearing out the variances and hitting the target of ten percent second the motion I think alderman MacMaster my goal is up beat autumn Alderman Forbes by a

▶ 2:46:49 Peter D. Mortimer: hair this was alderman medeiros this time did i you second or two didn't you all of them yeah i think she got it i think she got it okay but you definitely got cut off um did you catch those figures uh madam clerk of committees all right so we have a motion to amend this order made by alderman's worko to reduce the amounts that would be put into the reserve accounts um Said motion was made by Alderman's Worker and duly seconded by Alderman McAteer-Margolis. Is there any further discussion on the motion to amend? Alderman Inferno, please. Thank you very much. I have a question, I guess, for Mr. De La Russo. If we did not amend this and did it as you have here, and as President Kahn alluded to, that would give us a million dollars for next year,

▶ 2:47:45 Gail Infurna: I guess I'm a little confused thinking we've already set the water rates. why not go with this have the million in surplus for next year and then use that money to reduce water rates maybe for next year that's just my little simple mind of mathematics no no I think I would prefer to leave leave it as it is here we've already done the water rates which we know we did not raise and get us up to that good surplus that is over the 10 percent and then just work at that and give it food for thought for next year when we're talking about water rates to reduce then the water rates for next year in that through the chair in essence that's what the expectation would be my own expectation because your

▶ 2:48:34 Peter D. Mortimer: budget for 19 will not be what it is for 18 it's going to be higher the 10% figure will be higher you're already helping to reach that goal by having that money in the reserve fund now so you don't have to raise it in 19 you already have it that's I that was my position on that but what again whatever the board wants is is the board thank Thank You alderman for honors is that the list of your questions yes questions thank you very much alderman's work up next in queue withdraw and alderman Tramontozzi then alderman MacMaster my goals withdrawn uh thank you very much uh alderman Zwirko yields the floor are you yielding oh alderman so you're telling me that we can we can use the reserve funds to reduce the rate through the chair you are in fact when you

▶ 2:49:25 don't raise the rate to raise reserves that's exactly what you're doing well we've never used the reserve funds to reduce the water and sewer rates have we we have but but your rates have gone up because you were using the rate to build the reserve now that you didn't like this you don't have to use you don't have to build the reserve so your rate's not going to go up let's say it was a nickel for the sake of discussion it's not going to have to rub that nickel because you already have you already met your target for the year so for 18 you're all set you don't have to worry about raising the water store rate to to bring that money in it's already there i actually maybe have to do the cheer to all of them they were having this discussion about

▶ 2:50:06 reserve because i remember years ago we didn't have anything to talk about so i mean it's a pleasurable conversation believe me that's fine thank you alderman Tramontozzi alderman macatay margolis please so if this order were to pass as amended and we have 140 000 that we are not going to put into the reserve account would we be using that 140 000 to offset this coming fiscal year's rates no no no what are we going to do with it it would go into next year when they do the determination of free cash this little pocket of money will flow into that calculation that's all then they'll make a determination free cash etc so it would just go into that the pool as you call it the water pool and the sewer pool that's exactly what it's

▶ 2:50:57 called this pool cash it would just sit it would just sit for the year yeah it would close out to that fund both funds and then uh it belongs to both funds uh dollar for dollar and at that point next year we could we would have that once they certify it to begin looking towards the rates for setting them for next year absolutely and the dor will tell us how much uh free cash we have in both funds and this would go towards that absolutely okay thank you thank you alderman McAteer-Margolis Alderman Sorko please I apologize for withdrawing and then asking to comment so I just want to make a clarification statement here so the reason I amended the order if we put the funds as proposed not by myself

▶ 2:51:41 Michael P. Zwirko: originally proposed prior to the amendment into the reserves the fear is that we don't touch the reserves okay so then by removing the excess the variance the 140 000 that is going to go into next year's available fund hopefully to reduce outside of the reserves so it can be used to hopefully i guarantee i appreciate alderman Forbes comment it's a drop in the bucket when you're looking at a 15 million dollar bill on the water and sewer rates however it's there and it's not locked up in the reserves because as mr Tramontozzi said although apparently we have used the reserves in the past to lower the rates it's getting them out of the lock box the alleged lockbox just wanted to clarify that that's the difference thank

▶ 2:52:25 John N. Tramontozzi: you all the much work oh well all the ventriloquist but if we don't even put it into that lockbox we would have it available to do do with what we will on the rates so if we don't even put any money into the lockbox don't even put any additional funds into the reserve that those monies would go back to in the free cash into the pool and we can use that money to when we discuss rate setting once they certify two things once they certify it in the fall like they certified this time you know they certified it what did i say uh october 27th once they certify it this you know how much is available then you could have those conversations correct again though point of information it's not necessarily that you get

▶ 2:53:16 Peter D. Mortimer: dollar for dollar this is a point of information every year is different every year has their own little intricacies and that's something that i i i live by right thank you thank you alderman chair matosi so we have a motion on the floor to amend this order by the numbers previously stated by alderman Zwirko duly seconded by alderman makatia margolis all in favor please say aye aye aye any opposed opposed um so the motion passes one opposed move for passage of the orders as amended mr chairman president khan has moved for passage of the orders as amended duly seconded by alderman forbes on discussion seeing none all in favor of passage of the orders as amended please say aye aye any opposed hearing none the amended orders okay two opposed um so we have the order

▶ 2:54:15 Peter D. Mortimer: does pass two opposed and the orders as amended will be recommended to the full board for passage the next order we have before us is ordering 2017-142 it is the water enterprise operating budget for fiscal year 2018 in the amount of $5,204,163.34. The order is before you. President Contreras. Mr. Belruso, could you just indicate, actually for this and for the sewer, the figures for the mwra assessments for each one just so people at home know what we're paying to the mwra and what the city portion of the budget is please thank you um for the city of melrose for a water assessment two million eight sixty five eight sixty five and for the sore assessment all right oh I apologize no no no that's good that's right that's

▶ 2:55:34 right let me repeat that again I apologize it's the the print is a little bit small two million eight sixty five eight sixty five and for the sore it is six million four thirty eight six seventy seven six million four thirty eight six seventy seven and what's the city figure for each budget that's beyond the MWRA assessment if you back the MWRA assessment oh can you just give us the number for what we're budgeting beyond that please so our total our total water budget including debt and interest is 5.5 million 204 thousand 163 dollars and 34 cents so if you subtract the 2 million 865 865 dollars from it that's roughly um breakdown on the water side on the suicide total budget seven million eight hundred ninety four dollars

▶ 2:57:03 and sorry seven million eight hundred ninety four thousand dollars six hundred two dollars and eighty two cents six eight nine four six oh two point eight two is total budget including debt and interest the mwra portion of that is six million four hundred thirty eight thousand six hundred seventy seven dollars six four three eight six seven seven okay and for the total sewer budget we have an increase for this year of 2.4 is that correct correct and the water budget is actually down 0.8 percent is that correct and can you describe what inflow and infiltration work is set forth in this budget so it's um the borrowing the borrowing payments are in this budget however all of our ini work is done um through bond the the board passed the bond last

▶ 2:58:07 fall payment of that bond is is here a portion of that is also grant which we don't pay back and that program's ongoing we've been throughout the city since the early spring right now they're regrouping and they're studying that information and want to be back out in the fall and then we plan to come back at some point during fiscal year 18 to implement the second year of that program with an additional grant slash zero interest loan borrowing in order 2017 162 you're seeking an authorization to bond an additional 1.6 million is that correct yes that's correct that's for water improvements and the first payment of that bond is included in the budgets and and was included in the rate set this evening that's all i have right now mr chairman thank you

▶ 2:59:01 Monica C. Medeiros: president Khan alderman Medeiros please thank you thank you very much I I just wanted to read cap some stuff we talked about earlier earlier in our discussion we arrived at a figure of the increased of this of the new opt-in monthly billing there would be an increased cost to the water and sewer budget through direct and indirect cost of seventy one thousand five hundred dollars I know the ought the treasurer had mentioned that they're using an estimate maybe thirty percent of it is possibly opting in and so I figure that to be twenty two sorry twenty two thousand five hundred and twenty and just for informational purposes that's broken down by account that's a little over $28 per account which would be you know a fee of $2 and 37 cents or about $2 and 50 cents a

▶ 3:00:09 Monica C. Medeiros: month of 12 months would probably be an accurate way to possibly you know break that down otherwise we as a city are subsidizing that program that's an opt-in and so I just you know just let's keep that in mind or if we want to give people to encourage them to stay on quarterly billing some kind of incentive it would probably make sense with that said you mentioned also that there's one employee position here that is not coming back and so there's a reduction and staff in the water budget left voluntarily oh yeah there was a resignation and we've elected to not fund that position up so now there was a read on the sewer budget there was a retirement and we've elected to not fund that okay and now you know in this budget there are different different

▶ 3:01:14 places so if we have a water main break we do budget for some pipes and equipment in our regular budget right there are several lines in the water budget and the sewer budget there's a line for construction there's a line for repairs there's a line for water service replacement which is what how we address our lead service and some other substandard services that are out there we have lines in our budget for material patch pipes and fittings hydrants we have a line in our budget that we fund our flushing program for again that's a maintenance not a project type of activity and we have lines in both water and sewer for that we that we fund repairs to our water and sewer fleet repairs to our water and sewer pump stations there are various lines we

▶ 3:02:07 Monica C. Medeiros: captured fuel costs in the water sewer budget for the fleet we capture electricity costs for our pump stations and heat costs for our pump stations as well in these budgets i just want to make clear that you know we we do budget for some of these things so if there's a water main break in the street you know we've got we've got some equipment on hand and we do have a budget that is that takes into account that these things happen throughout the year and we're not going into the reserves to To go fix the water main break that happens in the street in the middle of the night Without an appropriation. We're already sort of funding most of those things in the budget It's only if we had a lot of unexpected ones that we might possibly go to the reserves to to look to fund

▶ 3:02:53 So and we haven't since we've had reserves No, no, we haven't I mean we try we try to fund the budget that we feel is realistic But you know that we also isn't over the edge in terms of being too conservative sewer expenses are very expensive very costly well you could have an easily have a thirty thirty five forty thousand dollar repair one shot that could liquidate a line if it's early in the fiscal year now that line is in at risk that's the point I think the auditor was trying to make what we try to stay as aggressive as possible and being proactive to try to find out problems but there's always a risk it's always a risk but thankfully since since I've been here and that I can recall you know we haven't and since you know since

▶ 3:03:43 Peter D. Mortimer: you've been here I haven't seen we went to reserves once when our back truck was done I think that's the only time and before was it all it was only until recently that we had reserves to turn to it was a period where we had nothing to fall back on that's when he and I were very nervous pretty well because most of the time we did thank you motion for concurrent action on order 2017 142 and 2017 143 mr. chairman second president con has moved for concurrent action on the operating budgets the second order is the water enterprise excuse me the the sewer enterprise operating budget for fiscal year 2018 in the amount of $7,894,602.82. The motion to conjoin the orders was seconded by Alderman Zwirko.

▶ 3:04:38 Peter D. Mortimer: No discussion on that order. All in favor, please say aye. Aye. Any opposed, hearing none, the two orders are joined and are before you. Alderman Infrante has made a motion to recommend the joint orders for the two operating budgets. Second. Really seconded by Alderman Forbes. Seeing no further discussion, all in favor, please say aye. Aye. Any opposed, hearing none, the two orders will be recommended to the full board for passage. The next order we have before us is order number 2017-150. It is an appropriation of $22,000 from the city wide meter replacement water enterprise fund number 6155. 110,000 and citywide meter replacement sewer enterprise fund 605 6045 110,000 to citywide water pipeline improvements fund six one three five two

▶ 3:05:42 Peter D. Mortimer: 110,000 and citywide inflow and infotation program fund 6095 110,000 as set forth here in motion to recommend alderman mcintyre margolis has made a motion to recommend this order duly seconded by president khan on discussion president khan please so um if this order passes this evening what if any money is going to be left in these accounts um there'll be roughly 30 000 left in um the meter account on the sewer enterprise and uh same on the water enterprise and that's just to complete the program which we're doing mainly in-house so it's to cover some meter expense some salaries and overtime um that's what we'll be using that's that's what we'll be left so we'll have sixty thousand dollars left and hopefully every one of these 300 homes that

▶ 3:06:42 haven't responded will respond and we'll get them metered and sixty thousand dollars is going to cover that yeah that's that's adequate funding for that thank you thank you president khan i'm seeing no oh alderman mcintyre just to clarify the money that you would be transferring you would be then using towards um ini projects um half of it would go to ini project and half of it would go to continue pipeline improvements and design studies throughout the city and you have a plan for where you have identified those okay thank you thank you Alderman McAteer-Margolis said motion to recommend this order for passage was made by Alderman McAteer-Margolis and duly seconded by Alderman Kahn seeing no further discussion all in favor please say aye

▶ 3:07:28 Peter D. Mortimer: aye any opposed hearing none this order will be recommended to the full board board for passage. The next order we have before us is order 2017-162, authorizing a bond in the amount of $1,610,000 under the water enterprise system through both MWRA, LWSAP, and local bonding for fiscal year 2018. So this order- Good evening, Ms. Paracas. this this order this order is going to continue our pipeline improvement project our city engineer Elena Perez Ellis is with us I'm gonna let her speak briefly to it and how we came about the projects that we selected and why we're proposing this at this time thanks John and I will be brief so when I had come previously when we talked about the multi-year roadway and utility

▶ 3:08:28 improvement project I'd showed various GIS layers of data on the roadway condition and the water main conditions and gas main conditions that drove those decisions of where we would go so I'll just speak in a little bit more detail about specifically the water component of that we completed this capital efficiency plan with the consultant Tata and Howard in February 2017 and they used an approach where they looked at three different elements of the water system citywide they looked at the condition of the assets themselves considering the age the materials of the water mains that are out there they looked at hydraulic restrictions places that are having trouble getting enough water places that traditionally have had pressure issues or other flow issues and

▶ 3:09:22 then they look at what they call asset criticality so is it the only water main that serves a hospital or a school or something that's considered a critical asset in the city and then they take these three parameters and they do like a Venn diagram what intersects all three and those pop up as the first phase of where they think we should be spending our money anything that hits two of the three criteria becomes second phase and anything that hits just one becomes the third phase and they have a phase three a and three B that kind of gets into the weeds so we're focusing our attention on phases one and two and projects that intersect with other needs so we've identified the Warwick Road neighborhood

▶ 3:10:07 and the Altamont neighborhood as coming up to the top of the list and then Florence Street we hope to start on the design of Florence Street as part of this initial set of funding the funding as proposed covers both the water main projects themselves and the restoration of the roadway we anticipate that National Grid will be working in some of these same areas and historically we've been able to get a contribution from National Grid towards the roadway improvements so that when we're done and they're done we can then repave the road and leave the neighborhood looking even better than it did before and you know having that contribution from them as well which we intend to seek and then the CEP the other recommendations will be used to keep guiding our future

▶ 3:11:03 Scott M. Forbes: replacement program as we move forward thank you very much are there any motions questions or comments motion recommend Alderman Tramontozzi has made a motion to recommend this order for passage duly seconded by Alderman McAteer-Margolis on discussion Alderman Forbes please thank you mr. chairman thank you for your presentation out of this 1.6 million is there any are we leaving any money on the table as far as the MW IRA is concerned just briefly just you know talk about that yeah they allocate about 500,000 a year and this will consume what they have left and then the general obligation bond would above and beyond that to make sure that we can complete the neighborhoods is there a there a time frame of when this work will be will be initiated start and

▶ 3:11:55 Mary Beth McAteer-Margolis: finish we are signing the design contract right now we anticipate the design will take a couple of months and then we hope to go out to bid later in the summer and start the work in the fall okay thank you very much thank you mr. chairman Thank You alderman Forbes next in line we have alderman MacMaster my goals oh just that um i know it's late but i want to say i think it's great that you have able been able to do this with the whole um gis program and the overlay and integrate it all and it's a great um opportunity to take advantage and leverage that that money and really let people know where what we're doing and that we're going to do it right thank you thank you and sorry you you had to be here so late that's it Thank You Alderman McAteer-Margolis what

▶ 3:12:44 Peter D. Mortimer: is it four hours close no on the tape though yes okay just for people out there watching TV land we might have had to recess if we go over a certain amount for the purposes of MMTV but I I think we're probably gonna get the horse in the barn just under the time limit next in queue we have Alderman Forbes please i already spoke mr chair okay thank you thank you no no problem next in line we have alderman McNaught excuse me once again alderman Medeiros so i'm going down the line here all the members please you're having a day like me here mr chairman um yes thank you very much glad to see that they were using uh using the data that in the projects that we've put some money into to pick these areas and

▶ 3:13:31 Monica C. Medeiros: moving forward in a in a strategic way um my question is this is for water if are we going in and we look are we looking at any of the sewer pipes as we're going into this area and and how are we handling that are we doing any i in in this particular area and and is that funded already or so everywhere we anytime we work in an area where utilities are involved we always televise um so the program we announced about two three weeks ago in the chamber that listing of streets is already areas where elena has had her staff and her consultants video inspect and they're analyzing it right now that's what that's what we're um that's what we're doing that's the process we're using um in many cases sometimes we go in after we work as well because

▶ 3:14:24 we want to make sure that the work we do doesn't damage any of the existing utilities but we do utilize that often and we try to identify air issues right up front so when we have some of this already the funding accounted for for if we need to do replace the sewer line along the way yeah we could always add it to our ini program okay thank you thank you thank you alderman materos alderman's worker please thank you mr chairman i'll be brief so we're bonding about 1.6 million dollars here and the amount that actually will um pay interest on that is 550 000 is that correct correct thank you mr chairman that's all that i had thank you alderman's worker a motion has been made to recommend this order for passage it was duly seconded seeing no further discussion

▶ 3:15:13 Peter D. Mortimer: all in favor please say aye aye any opposed hearing none this order will be recommended to the full board for passage motion to adjourn alderman forbes has made a motion to adjourn the appropriations committee duly seconded by alderman Tramontozzi all in favor please say aye aye any opposed hearing none appropriations is here by adjourn thank you one and all

Appropriations & Oversight Committee — 2017-06-08

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