Mayor Stewart's MEMORANDUM

MEMORANDUM

TO: Common Council Members
FROM: Mayor Timothy Stewart

RE: Update

DATE: September 3, 2010

In light of recent communication issues, I would like to bring back a tool that was used back in 2004-2005 to address the flow of information between the mayor’s office and the Common Council. Prior to each Council meeting, I will send a memo to all Council members on topics that I feel the Council would benefit from the sharing of information from me. It will not be an exhaustive list of items on the Council agenda, or necessarily be limited to agenda items.

This method of communication ensures that alderpersons receive information directly from me rather than through Council leadership and documents the information shared to avoid any confusion or faulty memories later on. Hopefully, this will dissipate some of the issues that arose at the August Council meeting and lead to more productive use of the Council and public’s time at the meetings themselves. I would also hope that this serves to generate questions by Council members. However, rather than hold questions until the meeting, I would encourage you to contact the appropriate department head or me to discuss your concerns and questions prior to the meeting. As always, please don’t feel you need to wait for the memo; you can always feel free to call me should you have questions or want more information on any topic at any time.

Capital Equipment Bond:

The last Capital Equipment bond was authorized in February of 2007 for $8.45 million, which was comprised of equipment costs of $7 million and financing costs of $1.4 million. That bond was designed to cover capital equipment needs for three years. The current request is also designed to cover a three year period of equipment needs and consists of a bond authorization of $7.8 million ($6 million in equipment, $1.8 in financing costs).



A few things I would like to bring to your attention on this:

• This is the first year that EMS is included in the City’s Capital Equipment request. This is due to the 2009 agreement where the City took ownership of EMS Building and vehicles. The agreement gave the City the responsibility for replacement of vehicles and capital purchases. Previous to the agreement, the City bonded for EMS equipment separately with EMS making periodic reimbursements to the City. EMS equipment constitutes $820,000 of the total request.

• The Police Department is in dire need of replacement vehicles. Making the situation even more critical was an accident earlier this week involving two police cruisers that took these vehicles out of service.

• As you can see from the Capital Equipment schedule, there are several vehicles from non-police departments that are unusable due to age and condition and need to be replaced. An example is a 1997 Bronco used by the Parking division of Property Management. There was an incident a few weeks ago, where this vehicle, parked in the upper floors of the Badolato Garage, actually rolled down the slope across the travel lanes. No one was hurt and there was minimal damage, but it points to the fact that we are using many vehicles well past recommended years of service. In addition to being a safety issue, it also increases costs for overtime at the garage to cover increased maintenance on these older vehicles (warranties long expired) as well as parts.

• I am not averse to lowering the amount of capital equipment, but I would caution the Council that going too low (say for example to do police vehicles only) is not feasible as the financing costs of a bond for those types of amounts would be cost prohibitive.

Surplus/Deficit Report for FY 2010:

While the City still finished the fiscal year that ended on June 30, 2010 with a deficit ($510,907), it was less than the $3 million deficit that had been estimated earlier this year. I would like to point out that this was due in a large part to the efforts of many of our departments that tightened their belts throughout the year by not hiring vacant positions and other cost saving measures to a total of $3.3 million in expenditure under runs. This is no small achievement given the lack of slack the budget had to begin with. Unfortunately, this was offset by shortages in estimated revenues from the state and other sources, which were negatively impacted by the sluggish economy.

I would remind the Council that in order for the City’s FY 2010 audit to be completed on time, that there is timeliness associated with the adoption of the year end entries. I am hoping that since there is no surplus to allocate that it takes away some of the controversial aspects of prior year entries. I would again hope that this can be passed on September 8th, but asked that at the very latest it be acted upon at your September 22nd meeting.

Budget Transfer from Fire Department to Contingency (Ald. Trueworthy):

There is no benefit and in fact some danger, to resolutions taking money from salary accounts at this point in the FY 2011 budget to contingency. First, any large department like Fire has fluctuations in its salary account from a normal year’s operations (retirements, new hires, promotions, acting pay, etc.) which amounts from vacancies are used to cover any overruns. For this reason, salary fluctuations (either positive or negative) are trued up at the end of the fiscal year through the surplus resolution. The danger from touching your contingency more than necessary is that rating agencies frown upon this type of tinkering with the contingency account as it implies you are funding operational needs from contingency or that your budget process is less than transparent.

Second, the Asst. Fire Chief will be posted and filled as soon as the salary issue is resolved (resolution currently on the table for Admin, Finance and Law). Ald. Trueworthy may be thinking of the second Asst. Fire Chief position which was in Chief Carr’s budget request, but was eliminated from the budget by the Finance Board.

If the Council does contemplate passing this resolution, I would point out that there is an error. The amount in full time salaries for ONE Asst. Fire Chief position is $80,903. The Health Insurance amount of $25,053 is in the Benefits account, not the salary account.

Aquinas Building:

I know all of you are familiar with the sad state of the former Aquinas property on Kelsey Street. Both the current and former owners have been cited for blighted conditions multiple times. The City has gone on the property several times and boarded and cleaned the property ourselves and placed liens on the property. There has been a fire and vandalism and vagrants living in the alcoves. The situation cannot continue.

Currently, there is approximately $116,000 owed in taxes on the property. Rather than go through a foreclosure action which can take up to a year during which the property deteriorates further, the owners have offered to have the City purchase the property for $1 and then we would take ownership and eat the taxes owed. A foreclosure auction/sale would also not guarantee that the City obtains the property, but it could fall in the hands of a bidder who would not be a responsible custodian of the property.

Inspections of the buildings show that the convent building on the Sheffield Street side may be salvable. There has been interest in the property and I am sure there would be even more if we demolished the high school building.

The state statute requiring public hearing on property transactions is only when we sell or lease city property. Purchasing property does not have to be referred to a committee.

Bioscience Zone:

A public act was passed in the last legislative session that gives bioscience companies that locate in certain tracts of land (including current enterprise zones), property tax reimbursements from the state (program administered by DECD), similar to the enterprise zone program with certain conditions such as job creation. This is an added marketing tool from the City, and does not involve the loss of any tax revenue to the City. This benefit will be available to any bioscience company that locates in our Enterprise Zone with or without the adoption of the additional tracts of property. Assessor Mike Konik will be providing a map to see where the additional tracts are (Pinnacle Heights and around the two hospitals).
Open Burning ordinance:

The City is required by state statute to designate an open burn official and have updated ordinances for procedures for open burning. The state’s primary concern is with vegetation and debris from hurricanes, high winds, etc. This will also provide the City with additional revenue through open burn permit fees.

Update on Recovery Zone Economic Development Bond Volume Cap:

The City’s application for volume cap allocation under the Recovery Zone Economic Development Bond program (approved by the Council on August 11) was approved by the Connecticut Development Authority on August 18th for a $9,935,000 allocation. These funds will reduce the City’s interest costs on the $35 million in police station bonding. I thank the Council for there swift action without which we would have missed this great opportunity to reduce our general fund interest costs.