2012-12-3 finance meeting with commentary

2012-12-3 Consolidation Finance Committee Meeting

Commentary by Mike Russo, Town resident

January 20, 2013

00:08:10
[Mayor] Jason [West], I can understand how [Village Treasurer] Nancy [Branco] was there in a technical and facilitative role, and not to opine on what consolidation savings would occur. But she was part of the committee, presumably present at every meeting. In the 12-3 meeting video, she refers to her "old notes" in trying to look up how they arrive at certain figures previously (8m10s), and she comments that she has "notes on everything" (9m20s). So, it sounds like she could help us out by looking at those notes and telling us (1) when the various problematic line items were discussed, and (2) making explicit what her notes say about what was discussed with those line items. Go to that video and listen to minutes 6 through 10, where the committee discusses safety inspections and see how Nancy's role plays out as she tries to clarify what the group had previously decided about consolidation savings.

00:21:00
At around 21:00, there's discussion around questions of methodology, and even a vague passing mention of the Building and Grounds costs.


00:38:50

A minor item but points up a semantical issue: as per 12-3 video 38m50s, A8160.4 refuse and garbage shows up as a $2000 expense reduction but it is directly offset by a loss in revenue shown on A2130 Landfill Revenues. So that $2000 as part of the $1,625,258 is a reduced expense but cannot be referred to as savings.

00:41:20

Watch this: An extended discussion of DPW lines at 12/3 meeting starts at around 41m (though it takes a minute to get underway). Nancy points out the EXACT arithmetic error that I pointed out at the 1/15 meeting and at some point even comments that taxpayers will wonder why the numbers don't add up right.

Sally's email gives no information about the actual ways that savings will be achieved. We have a mish-mosh of information when we compare what Susan said at the 11/5 meeting (above), Sally and Susan said at the 12/3 meeting and what Susan said at the 1/15 T/V meeting (some of which was utterly in contradiction to her last comments of the 12/3 meeting). As for whatever portion of the savings is attributed to the joint buying of salt and macadam, we sure don't need consolidation to do that.

In the 12/3 meeting, it sounded like specific details existed on how the $520,077 in savings would be generated. Those details may or may not have gotten to the whole FC, but it does seem to have existed between Susan, Sally, Bleu and Chris. And there's those comments at the meeting 48m20s by Susan about how Chris got concerned about the $520k number but she sat down with him and reviewed the figures and "they were able to build back up to that number." Then Ross asks "the same number?" and Susan says "pretty much."

Hopefully, we'll get a full response from KT's very detailed inquiry that she sent to Chris.




00:47:00
[Town Supervisor] Susan [Zimer]'s comments from 47m to 48m20s relate to the methodology inconsistency and she references the Town's [Highway Department] cuts in 2013 without making any qualification to it being anticipatory of merger. She seems concerned about how to present the [Highway Department] savings claim but [Deputy Mayor] Sally [Rhoads] insists that it should remain as is.

00:48:20
Susan and Sally then discuss their meeting with [Village Superintendant of Public Works] Bleu [Terwilliger] and [Town Highway Superintendant] Chris [Marx]. Susan mentions that Chris came back to her later, asking about how they came up with the high $520k number (48m20s). But Susan then says she reviewed the figures with Chris and "they were able to build back up to that number. The committee appears to be working with a separate sheet that breaks out the various DPW [and Highway Department]  lines and calculations.



00:53:00
At 53m the discussion shifts to the A9060.8 Hospital/Medical/Dental Insurance line, where the committee is simply putting in a 10% reduction in cost.  At the time of the 12/3 meeting, the Expenditures sheet reflected a savings of $1.36 million, not $1.62 million.



01:39:00
An interesting 3-min exchange about the rushed timeline going forward to referendum. Russ Pollack shows up as a voice of reason on this matter, though all agree that the report as of that date is not yet a finished product.  If I understand Sally's description of the methodology used for the DPW/Highway lines correctly, they subtracted 2012 Village expenditures and 2013 Town Budget expenditures from the sum of 2011 Town and Village expenses, and the resultant figure is $520,077.



01:53:00

Question: Can the Sewer District #6 situation be effectively and cost-efficiently solved in any other way than through consolidation? Perhaps there is significant cost savings with that aspect. This topic was discussed at 1h55m.




03:06:30
But if the 2013 Town budget assumed they would do without hiring a new Water & Sewer expert (as Sally said at the 1/15 meeting (at 3h6m30s),and instead would use the same water and sewer contractor as the village uses, than how come we aren't seeing in the Savings column, an increase in cost, i.e. negative savings, for water and sewer contractual expenditures? Would the water and sewer contractor be willing to bundle in the Town sewer responsibilities at no extra cost?
-- update: Actually I realize I can't tell this because I don't know all the codes included in the 520,077. It's on that sheet that Sally handed out but she didn't give me a copy. Would this be in the SSA, SSE, SSF, SWA, SWB, SWC, and SWD funds? I don't see an appreciable change in the lines of those funds from Town Budget 2012 to Town Budget 2013. I guess I have to wait for the breakout schedule that hopefully will come from the Fiscal Committee.



00:48:40
Also in regard to the DPW issue, Sally said in the 12/3 meeting (at 48m40s) that she sent Chris and Bleu,

"The outline of the results of our discussion and what was what and where was where, and he [Chris] did not call me so I'm going to go with the results of the discussion."

So it would be helpful if the FC provided us with that document. Or at the very least, Jason should receive that document via his FOIA request.



01:20:40
The issue of apportioning an unequal burden of police costs to Village District #6 is discussed. The extended exchange immediately follows after Dave Lent points out that tax cuts for town taxpayers would be quite modest (even using the FC's outsized claims of cost savings). Dave then states "However, this in my mind, is the perfect timing to consider if we want to try to allocate the police costs more to those responsible for creating the need for police..." All agree about redistributing police costs in some way, but there is a difference of opinion on whether the extra burden should be on every taxpayer in District 6, or only commercial properties (including any rental properties, which would require a change in the assessment rules).



01:22:47
About tax rates: Something I missed in my previous comment about this video segment is that I believe Sally is pushing for the idea of taxing rental properties at a higher tax rate through the community, not just in Village District 6.



01:36:52
Later in that same discussion at 1h36m52s: Susan says:

Not the specifics, but if the concept is written into the overall plan, the people of the town residents outside the village might be more willing to vote for this consolidation because they are going to see a government that is thinking about the fact that they've been getting taxed for god-knows-how-long , in their mind unfairly -- I don't care if you agree with that or not, but in their mind, unfairly -- you're giving them a reason to say there's value to this new government because it's going to correct the inequities, so therefore support it.

Well, this seems to me pretty much out-and-out crossing the line from the job of estimating potential savings due to consolidation, to talking about how to package and sell the idea. Is that a problem for anyone else? Am I making too much out of this aspect, being that politics is politics so no surprise, who would expect anything but? To me, if they are supposedly doing an objective, unbiased internal study in lieu of contracting an outside accounting firm, then this crossing the line is tantamount to yet another (the fourth) breach of an accounting principle, that of Neutrality.

Neutrality: Information contained in financial statements must be free of bias. It should reflect a balanced view of the affairs of the company without attempting to present them in a favored light.



01:47:00
Another example of overt bias in presentation intent: 12/3 meeting 1hr47min. Dave Lent points out that with consolidation, those town property owners who pay for water will receive a major discount in their rates, while those water users in the village will pay a slightly higher rate. At 1h48m25s, Sally says to Dave:

"I'm going to insist that you exploit and emphasize the decrease and benefit to the town users." 

The word "exploit" has no business showing up in a meeting that purports to be for the purpose of objective analysis.



02:06:24
Important segment of 12/3 meeting. At 2h6m24s, Ross argues that a rush to referendum may be a mistake - if referendum fails, another one cannot be held for four years. He worries that with the current timetable, the public may not have enough time to receive and understand the information. (He also contended this same point earlier in the meeting.) Sally and Susan argue against his point. At 2h7m24s, Susan states:

"Come May, Stewart Glenn leaves the board. Brian Kimbiz leaves the board. You can't have a board that is totally against consolidation. Within a year, my term is up. You don't know what's going to happen with the next supervisor; if they're going to support it. So basically we are at a moment in time when we have a lot of people who are committed; we have the support of both boards to move this forward. If we don't grab the opportunity now, and we wait longer than April 1st, then you're dealing with a bunch of unknowns and as far as I'm concerned, kiss it goodbye."

02:25:19
(DPW/Highway-related) Another critical segment at the end of the 12/3 meeting. I have transcribed the full exchange:

Susan Zimet

"Because of the reductions we've already made in the town government, it's already aligning itself -- we've already absorbed some of the changes --" 

Ross Pollack

"making the process much softer --" 

Susan Zimet

"that's exactly right -- so the process now of merging the two governments because we've been making reductions in the town government and merging our departments, it's almost in a way a first step to this bigger merger that actually makes the potential to merge these governments without any layoffs that much more viable because we're already done. --" 

Dave Lent

"Susan, may I suggest that, and this is not a fact but a probability, but if in fact if the merger is not the end result of this situation, then some of those reductions may have to be changed and new people hired -- " 

Susan Zimet 

"I can say that the reductions that are reflected in here from the town -- those reductions are here to stay."

03:07:55
Susan's contention above at the 12/3 FC meeting "those reductions are here to stay" is in direct CONTRADICTION to her statement at the 1/15 Town/Village meeting at 3h7m55s.

She lists out many vacated positions that were not planned for rehire in the Town 2013 Budget, and says "So every decisions that was done in the 2013 Budget was done with the eye towards hopefully we can consolidate."

Then she says "I can assure you that if we do not consolidate, next year's budget, we might see people added back to the budget because that assumption is off the table, gone, and we'll make certain assumptions in the Town Board, how we present our next budget based on the fact that consolidation is no longer on the table and the status quo will not be acceptable."