Meeting Minutes

The Finance Committee met Wednesday, January 11, 2012 at The District Offices at 245 Main Street, Cromwell, Connecticut.

Chair, Doug Sienna, called the meeting to order at 4:45 PM. In addition to the Chair, present were Committee Members - Gerry Amodio and Jim McNair. There was a quorum. Also present were Board Chairman - Bill Candelori, Board Members - Peter Centurelli and Ed Sasso, and Executive Director - Brian Armet.

1) 2011-2012 Budget

The Executive Director reviewed the 2011-2012 Draft Budget and the Line Items that have been increased with the Committee. The largest increase is in Admin Expenses Nitrogen Credits: this item increased $100,000 because The District's Credit Costs for 2011, payable in May 2012, will be around $175,000 and it is projected that 2012's Credit Costs, due in May 2013, will be around $200,000 plus. The other large increases in other line items include:

• adjustments in employee expenses;
• Operations Department - $40,000 increase in Fuel because the emergency diesel account will be over by approximately $40,000, due to Hurricane Irene and Winter Storm Alfred, and we do not want to be caught flat footed again, and $10,000 in the sludge hauling account because sludge hauling costs during the incinerator's annual shut down for service and repairs have exceeded the budgeted amount for the past two years;
• $100,000 for Cromwell.

The Executive Director indicated that the increase in the Capital Line Item was reduced to $328,210 from the earlier draft that had $728,210. He indicated that the Capital Line Item was being increased to gradually phase in the annual CWF Loan Payment projected to be $4,715,000 in FY 2015-2016. It has been reduced for two reasons: it was too large an increase at this time; and, The District may not need the full $4,715,000 until FY 2016-2017: therefore there is five years to phase it in instead of four.

User Fees - while the Operations Budget only increased 3.5% and the total Operations and Capital Budgets increased 7.82%, the net user fees increased 5.65% for New Britain, 17.62% for Berlin and 19.46% for Middletown for the following reasons:

• change in flow allocation shifted away from New Britain, 2%, to Berlin and Middletown, 1% each, and MDC, 0.5%;
• reduction in credits to New Britain, Berlin and Cromwell; and,
• Sludge, Septage, Interest, Misc and Operating fund transfer incomes at $1,375,000 did not increase, additionally impacting the other user fees.

Mr. Sienna asked how much of the Capital Line Item was for Capital Repairs and how much was for the CWF Loan Payment Reserve Set Aside. The Executive Director stated that $400,000 was for Capital Repairs and $200,000 for the Reserve Set Aside.

Mr. Sienna asked that the format presentation be revised to separate out and show separately the Cromwell $100,000 Annual Payment and the Reserve Set Aside to more accurately show the increase in the Operations Total Budget and the increase due to the Cromwell Annual Payment and Reserve Set Aside. The Executive Director stated that he would implement these changes for the Board Meeting.

The Committee asked that the Draft 2012-2013 Budget be a Table Item for the January 17th Board Meeting for informational purposes, and that they would take action on the Budget at the February 21st Board Meeting.

2) Related Business and Staff Updates

The Executive Director reported on EPA's notice that The District had not submitted the required Annual Hazardous Waste Exporters Report for 2010. The District had sent the report, it just went to the wrong Mail Stop. The District immediately responded to this request. He also reported on the trees along the Right of Way along Route 372 in Cromwell across from Friendly's that the Beavers had gnawed at and as a result could potentially have fallen onto Route 372.

Adjournment:

Mr. Amodio moved, Mr. McNair seconded, and the committee approved unanimously to adjourn at 5:20 PM.