HomeMy WebLinkAboutMeeting Minutes 4-13-20
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BUDGET COMMITTEE
Meeting Minutes - April 13, 2020
Committee present: Pat Leary, Pamela Bleiwas
Staff present: Mike Solvig, Donna Shaw, Judy Drake, Susan Ritter
Others present: Rod Howe, Bill Goodman
Meeting was called to order by Chairman Levine at 12:10 p.m.
AGENDA ITEMS:
• Review and approve February 24, 2020 meeting minutes.
Moved: Pamela Bleiwas Second: Pat Leary Motion Passed.
• Review of 2020 Meeting Schedule.
The Committee briefly reviewed the revised meeting schedule incorporating the change from the
3rd Monday of the month to the 2nd Monday of the month.
• Discussion of COVID-19 Implications on the 2020 Ithaca Town Budget.
- Sales Tax Collections: Collections in 2019 totaled $3,597,162, an increase of 6.2% over the 2018
total of $3,388,799. For 2020, the Town had budgeted $3,250,000 in sales tax collections;
$1,500,000 to the General Part-Town Fund, and $1,750,000 to Highway Part-Town Fund. Based
on prior year experience, we were expecting collections to be 4% over the prior year’s actual
collections, or approx. $3,740,000. With the closing of businesses due to the COVID-19 pandemic
and expected loss in sales tax revenues, staff attempted to estimate the loss in revenue.
Actual Actual Actual Actual Actual Budget
2015 2016 2017 2018 2019 2020
Sales Tax 3,067,336$ 3,003,943$ 3,184,969$ 3,388,799$ 3,597,162$ 3,250,000$
Mortgage Tax 415,760 286,227 279,791 299,934 400,947 250,000
Tax Collections
Staff developed two projections. The first estimates a loss of almost $278,000 in collections for
2020. The second estimate assumed a longer shutdown and slower recovery, resulting in an
estimated loss of $570,000 in revenue for 2020. This would be a loss of $263,000 to the General
Part-Town Fund, and $307,000 to Highway Part-Town Fund. While the loss of revenue hurts,
the Town is fortunate that the two funds this directly affects currently have fund balances
adequate to absorb the estimated loss without having to resort to employee layoffs/furloughs
or reduce other expenses. Should the business shutdown last longer and/or the loss in revenues
exceed the estimates, we may have to revisit this topic.
- Mortgage Tax - Mortgage taxes in 2019 increased 33.7%, over prior year collections, totaling
$400,947. Mortgage tax revenues, assigned to the General Townwide Fund and budgeted at
$250,000 for 2020, are almost impossible to estimate from year-to-year.
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- State Aid – The Association of Towns is estimating that municipalities will see a 50% reduction
in State Aid from the prior year. This would result in a loss of about $42,000 in AIM-Related
payments to the General Townwide Fund, and $65,000 in CHIP’s payments to the Highway Part-
Town Fund.
The Committee discussed the information presented and concurred that the situation currently
does not require the Town to consider the layoff or furlough of employees, or reduction to other
programs and expenses at this time. The Committee will continue to monitor Town finances in light
of the current situation.
• Continue Discussion of 2020 Bond Issue.
Pat Leary asked that the Committee re-visit the decision not to issue bonds in 2020. The Town was
originally scheduled to issue $2,350,000 in new long-term debt this year to finance 2019 and 2020
Water Main Replacement projects and $1,400,000 to finance the Public Works Facility Office
Expansion project shown on the schedule below. At the pre-pandemic Budget Committee meeting
Amount Amount Issuance
Budgeted Authorized Costs
Public Works Facility Office Exp. 1,400,000$ 1,400,000$ 14,650$
Winthrop Drive Water Main Replmnt.625,000 700,000 7,300
Muriel Street Water Main Replmnt.700,000 630,000 6,550
Winston - Salem Water Main Replmnts 875,000 1,000,000 10,500
Total - 2020 Bond Issue 3,600,000$ 3,730,000$ 39,000$
2020 Public Improvement Bonds
in February, the Committee decided to pay for the Public Works Facility Office Expansion with fund
balance from the General Townwide Fund. While this would result in a lowered fund balance in the
General Townwide Fund for a year or two while it was re-built, the relatively stable economy at that
time made this seem to be a good decision. Now in April, the situation has radically changed with
the COVID-19 pandemic:
1) The economy is no longer stable. Moving forward into an unstable economy with high national
unemployment not seen since the Great Depression, and the possibility of the virus making a
resurgence in the fall, having a low fund balance in the General Townwide Fund may become
problematic, and
2) With interest rates again at historic lows, this would be a very good time to issue bonds.
After discussion, it was the consensus of the Committee that it would be prudent to maintain the
current fund balance of the General Townwide Fund against the possibility of a worsening economy,
and to proceed with issuing bonds this year for the 2019 and 2020 Water Main Replacement
projects and the Public Works Facility Office Expansion. Mr. Solvig will contact the Town’s Bond
Advisor and Bond Attorney to begin the process.
• Continue discussion on Investment of Town Funds.
In March, the Town earned $34,691 in interest income. $12,096 came from the Certificates of Deposit,
$42 from the individual savings accounts at Tompkins Trust, and $22,553 from the Short-Term
Investment account.
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As of March 31, out of $29,757,372 in available funds, $6,851,835 or 23.0% was invested in Certificates
of Deposit at an interest rate of 2.23%, maturing on May 15, 2020. $22,717,104 or 76.3% was in the
Short-Term Investment account. The Short-Term Investment account includes $3,380,000 in property
tax collections still held by the Town at this time. The remaining $188,433 or 0.6% was in various Town
savings and checking accounts.
• Other Items.
- Audit of 2019 Financial Statements: Auditors from Sciarabba Walker & Co. will be performing
the audit field work remotely this year. Field work is scheduled for April 20 - 24.
- Route 96B Sidewalk Project: Sue Ritter informed the Committee that the bids for the Route
96B/Danby Road Sidewalk Project have come in approx. $97,000 over the amount budgeted in
the grant. The Town will be responsible for this amount over the budget. There is a $20,000
item in the budget for ROW acquisition that was not used. She will have that $20,000 moved
to the construction line, which will reduce the Town’s responsibility to approx. $77,000.
The meeting was adjourned at 12:57 p.m.
Next Meeting: Monday, May 11, 2020 at 12:00 pm, Town Hall - Aurora Room