New Britain Borough Financial Advisory Committee

Meeting Minutes

September 27, 2016, 7:30pm

1. Call to order

1. The meeting was called to order at 7:32PM by Chairman Mr. Frank Lombardo

2. Pledge of Allegiance
3. Roll call

1. Members present were Frank Lombardo, Art Conover, Joseph Borek, John Wolff, Jr., and Danielle Young.  Sam Bryant (Borough Manager) was also present. Council Liaison Jeff Gilmore was absent.  Council Vice President Peter LaMontagne was present as a guest.

4. Approval of Minutes
5. Unfinished Business

1. Miller Property Financial Review

1. Mr. Bryant and Mr. LaMontagne gave background information and a presentation on the Groner finances and Miller property.  It was noted that the Groner fund is losing money to inflation, as it is limited to investments that have below inflationary returns.  However, research showed that the Groner House, as well as rental properties nationally, generally meet or outperform inflation.  Thus, the Miller house could be used as a rental that would net a higher return than other investments.  In addition, a DCNR grant could help support the purchase.
2. Mr. Borek asked about the price requested by the seller.  Mr. LaMontagne shared the price the seller paid for the property, and provided a spreadsheet with different price and grant scenarios for the Committee to review.
3. Mr. Lombardo asked the Committee to come up with any worst case scenarios.  Mr. Wolff asked about possible building renovation or maintenance.  Mr. Bryant noted that a review by him, Mr. LaMontagne and Council Member Bob Binkley raised no major concerns.  Mr. Conover asked about troubles finding a renter.  Mr. LaMontagne noted the current property owner would plan to rent it.  Mr. Conover asked about the floodplain.  Mr. Bryant showed that the FEMA floodplain map has the property located outside of it.  Mr. LaMontagne noted the highest recorded flood was still below the property location.
4. Mr. Conover motioned to recommend to Borough Council the purchase of the property, as long as the seller agrees to one of the price scenarios presented.  Mr. Borek seconded the motion, and all members present voted in favor.

2. Knoell Financial Impact Review

1. Mr. Bryant provided the history of the spreadsheet to document the revenues and expenses from the possible Knoell development.  It included review from himself, Mr. LaMontagne, Mr. Wolff, Mr. Lombardo, Steve Barth (Borough Economic Consultant) and Erik Garton (Special Projects Engineer).
2. Mr. Bryant felt that most of the formulas devised were reasonably accurate, except his road maintenance calculation.  After discussion of various scenarios provided by Mr. Wolff, the number was revised.
3. Discussion of possible rental prices and a comparison by Mr. LaMontagne to other rental complexes in the area showed that the number of students that live there was more important financially than the other variables, such as rent.  This is because students are unlikely to pay EIT and more likely to generate police expenses.

3. 2017 Budget Worksession / Strategic Plan Presentation

1. Mr. Bryant reviewed the current status of 2016 budget projections, which show the Borough ending with a $25,000 deficit, compared to the $190,000 budgeted.  With the “vanilla” five year plan, the general fund budget has a $40,000 surplus for 2017.  Mr. Bryant showed the graphs and questions he developed for each fund he would like the Committee to present to Council.  After this, Mr. Bryant would present Council with a number of budgetary options and capital projects to consider.  Mr. Lombardo and Mr. Wolff confirmed they will be in attendance to present.

6. New Business
7. Adjournment

1. Mr. Wolff motioned to adjourn.  Mr. Conover seconded the motion and approved by all members present.  The meeting adjourned at 9:32 PM.