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Special Board of Aldermen Public Hearing Page 7
Director Budreau

| think it’s critical before | leave to let you know that this is the first time that the rates have increased
since July of 2013. If you were to take a look of the appropriation for the last several years, it’s been
relatively flat. So you really have to look at it it’s not a year to a year increase of $4 million but the
first increase in the appropriation since fiscal 2014.

Fred Teeboom

Show the comparison. One other question on page 18, line item 191. The schools went up for
$137.9 million to $141.4 million. That’s not the full cost of schools because the full cost of schools
are closer to $160 million if you look at the MS2. (inaudible) Just look at these costs, that almost a
$4 million increase. That’s 2.58 percent. It is well above even your guideline Mayor. This is way
above any spending cap, an inflation calculation of 1.4 percent. That happens to be 2.58 percent. Do
you have an explanation for that? Line item 191.

Mayor Donchess

Yes the figures you're looking at include pension and benefit costs which for the sake of analyzing
year to year costs of operations are not included in the guidelines that | gave. If you look at
operations only, the guideline | gave for the school was 1.9 percent which could accomplish various
things. That’s what they did. | cut the budget by $100,000 to achieve the 1.9 percent. What they got
for that was they were able to budget for full day kindergarten and the Superintendent had proposed
that in order to do that, two | think critical services be removed because here original budget was a
little bit below this. One was the Clearway High School to bring that in house at a savings of
$300,000. Number two, to eliminate teaching coaches — two of them. After hearing from the
community regarding the value of the Clearway High School which is operated by the Adult Learning
Center and has been for a least a couple of decades effectively | thought and based upon the need to
make sure that our young teachers develop to the fullest extent that they can, the teaching coaches
are also critical. So | gave them a guideline which enabled them to put the full day kindergarten
without cutting Clearway or the teaching coaches. That’s why the budget is up. The numbers you’re
looking at include the benefits of a pension that we’ve already talked about.

Fred Teeboom

So when you gave them the 1.9 percent, you were aware that there could be additional increases
because the pension had doubled in costs.

Mayor Donchess

Yes.

Fred Teeboom

You still gave them the 1.9 percent.

Mayor Donchess

Yes we’ve been talking about the pension problems for many months now. As the year progressed, it
became obvious that the amount of money that we would need to actually pay the health benefits was
going to be higher than last year. Now last year at the end the amount budgeted — when | say last
year, | really mean our current fiscal year.

Special Board of Aldermen Public Hearing Page 8
Fred Teeboom

When you had these discussions is it discussion the school department affected the enrollment is
about 20 percent...the enrollment today in the schools is just about 20 percent below than it was in
the year 2000.

Mayor Donchess

Well that might be but the main cost of education is salaries for educators including teachers and
paras and to some degree administrators. At this point, Nashua is about 50" among the school
districts in New Hampshire as far as teacher's pay goes. It’s not like we’re paying so much more.
There are 50 districts in New Hampshire that pay more than us. The cost would be much higher had
those reductions in enrollments not occurred but certainly as | said, there are districts like Concord. |
think their average pay is like $12,000 or $15,000 more than ours. Then there are 49 districts
approximately between Concord and us.

Fred Teeboom

There’s 180 districts there. So if we’re 50, it’s 130 below us.

Mayor Donchess

That’s correct.
Fred Teeboom

The other point | wanted to make...

Mayor Donchess

But Nashua has probably of those districts probably among the highest cost of living because we’re
on the Massachusetts border. Real estate prices are higher than much of New Hampshire — not all of
it but much of it. So the cost of living here is a little higher than many of those districts that pay more.

Fred Teeboom

If you wanted to cut costs, if you really wanted to manage it so go along with the flow, assess the fact
that the enrollment is down by 20 percent. Many of these elementary schools have empty
classrooms. Almost empty classrooms. You can close at least one school. In 2006, there was a
(inaudible) study and the summaries were kind of whitewashed because they basically said they can
close the school — Mount Pleasant particularly which is right next to Amherst Street. Today you can
close two schools. Each of these elementary schools cost between $4 — 6 million to operate.

Nobody has ever followed through the idea if you have that much reduction in children going to
school, why don’t you close the school? We've got 18 buildings. We have 12 elementary schools.

Mayor Donchess

Well that might be something that the school department, the School Board, should consider and at
least think about and analyze. That is a decision that is up to the Board of Education. Of course |
would want to get their input. The expansion to full day kindergarten will — we could have them come
up but | don’t think it is correct that there are many, many empty classrooms. The expansion to full
day kindergarten will take up some classroom space.

Special Board of Aldermen Public Hearing Page 9
Fred Teeboom

I’m glad you brought that up. Not all of us and many of us are not enthused about the fact that we’re
not pushing full time kindergarten.

Mayor Donchess

Well there were people who weren't enthused when we went to half day kindergarten. To be in 21°
Century America to attract young families to be a community where jobs/employers want to locate,
you really need to have full day kindergarten.

Fred Teeboom

First of all, lm not so sure we want all these jobs to be located here. | don’t quite see the benefit in
that because the city is getting pretty filled up. Second of all, there are studies that | cited to the
School Board — there’s School Board members here that can attest to that — that cited full time
kindergarten is not of benefit to a lot of kids because they can’t be structured into full time classes for
6, 7 hours and no one has shown anything past the third grade ever that there’s a benefit past the
third grade. But we’re spending over $1 million more. More than a $1 million. | forgot the exact
number - $1.1 million or something like that for full time kindergarten. We're saving 10 teachers that
are switching from teaching elementary school to kindergarten. If you want to save money if it’s all so
terrible, why are we saving the jobs of 10 teachers? Now | feel for the 10 teachers but they can
maybe get a job in one of these higher paid districts. Why should we take elementary teachers and
put them into kindergarten to push this full time kindergarten agenda? I’ve maintained part of the
reason is to fill up this empty class space because Superintendent Brown is here. Why don’t you
have her answer that question?

Mayor Donchess

| don’t agree with your analysis regarding the benefits of full day kindergarten. | disagree even more
strongly with respect to your statement that we do not want to add jobs to this community. If we want
a declining, suffering, spiraling down community, yeah then we don’t want jobs. If we want a growing,
vibrant community which will be successful in the future, we need to add as many jobs as we possibly
can.

Fred Teeboom

It’s a theory the more jobs bring in the more vibrant a community? Is that the theory?

Mayor Donchess

If you want economic growth, you need jobs and we need to add certainly more than McDonald’s or
minimum wage. What we need are high skilled jobs value at a job that pay well with a pay families
that pay the employee sufficiently to support their family, provide a good education, and a college
education for their kids. VWe’ve made progress there but we should make more progress.

Fred Teeboom

Now you're talking about high paying jobs as opposed to jobs. It’s very likely that low paying job
people come in and want to (inaudible). | raised five kids. None of them went to kindergarten that
was paid for and they went full time. They didn’t go full time but part time. You can have
philosophical ideas but here we’re talking about budgets and trying to not keep adding more and

Special Board of Aldermen Public Hearing Page 10

more money. $4 million more to the education budget. $4 million more to the pension budget. $4
million more to the benefits budget and misrepresentation of the spending cap. All right. That’s
enough for now. Thank you.

Chairman Dowd

Is there anyone else that would like to speak to the first 59 pages of the budget or the Mayor’s
Office?

Paula Johnson

Good evening. My name is Paula Johnson. | still live here in Nashua. Mayor there was an editorial
back in the Telegraph on May 2" that questioned you. Just how tight is Nashua’s budget? |
happened to read this while | was on vacation. | really was in shock to find out about the $200,000
that you want to give to allow people to become volunteers in this city. We have 15 aldermen to
make decisions for us. Not always in the best interest of the constituents but we elected them and
we pay them $5,000. Now unless the cost has gone up but | still believe its $5,000 a year. We want
to get people more involved. I’m not paying somebody to get involved here. | don’t know what their
background is. | don’t know what they want to do.

Mayor Donchess

Ms. Johnson that’s a misunderstanding. The proposal is not to pay anyone to get involved. It’s that
we don’t pay any volunteers.

Paula Johnson

Then are you telling me the media is lying here is fake on what they reported?
Mayor Donchess

They don’t say we’re paying volunteers. If they said that, that’s completely mistaken.
Paula Johnson

$200,000 for a citizen’s lead pilot program that will allow volunteers to draft plans for city projects and
put them up for a vote. Someone is getting paid for that $200,000.

Mayor Donchess

No wait. The way that that would work but before we get too deeply into it, the Budget Committee did
recommend a change there. The way that would work is first of all it's not an increase in the budget.
Right now we operate a capital improvements budget where we make improvements where we
budget community improvements — swimming pools, sidewalks, various reserve funds where we need
to do building maintenance and things like that. The way that the process has worked — and the
budget last year was around $1.2 million and this its’ a little more. So the budget is not up because of
this.

Paula Johnson

I’m not saying it is.

Special Board of Aldermen Public Hearing Page 11

Mayor Donchess

You asked so I’m going to explain it. It’s not up because of the proposal. Normally what happens is
that the Mayor — in this case that’s me — proposes after hearing from the departments proposes to
the Board of Aldermen which project we should undertake. Now what I’ve suggested that out of that
$1.2 million, citizens be allowed to make suggestions and vote on projects that would be proposed to
the Board of Aldermen. Still have to be approved by them. So it’s just another way of proposing
projects. The people would not get paid. If you look at the results of this process around the country
and we would definitely not be the first city in the country or the first city in New England. There are
numerous cities in New England that do this already. In those places where they do it, the results at
least from what | see are pretty positive.

Number one, they come up with projects that the officials don’t necessarily think of. They might be
aware of a building that needs improvement, or a sidewalk, or might have a different idea as to what’s
important. Secondly, the number of people participating and voting on these things is going up in
every community where they’re doing it. So the thousands of people in some communities end up
voting. Third, the cities that do it are increasing the amount that they allocate to this process every
year. They’re not decreasing, they’re increasing because they see it as a big success. Obviously
there is disagreement about this. Some aldermen feel that the money would be better spent
elsewhere and maybe they’re right. All I’m saying is that no volunteers get paid. It’s not an increase.
It’s just a different way of allocating money in a budget that’s similar to last years and that it’s an
attempt to get more people, maybe hundreds or thousands of people involved in thinking about city
budgeting that aren’t involved now. Wouldn't you like to propose something for your neighborhood
and maybe be able to vote on it?

Paula Johnson

You know Mayor, | have proposed things for my neighborhood. My alderman is sitting right here and
when | came in| spoke to the Chief of Police about my neighborhood. The fact that for two years
already | have asked if the Police could please come down because by Ledgewood Hills, the cars
keep running the red light. It is completely red and they just keep going through in each direction.
I’ve asked to propose this. As a matter of fact, | was speaking to the Chief of Police when | came in
and alderman made a comment to me about being fired up. Of course I’m a little fired up about it
because | pay taxes in this city. We don’t see any results right at that corner and all the money
seems to go with the police for this opioid epidemic which we understand. There has to be some
money that goes for the rest of the people in this city. Yeah | was a little bit fired up but so is
everybody. You heard several at the town hall style meeting because of the fact we can’t get any
police over there. | would like to see maybe that $200,000 that you want to put in this to have the
police sit out there and a lot of traffic lights in this city that these people are so rude that they keep
running the red lights and somebody is going to get killed somewhere. Then it’s already been
complained about.

Mayor Donchess

Well you may get your wish because the Finance Committee recommended that that $200,000 go to
police overtime. You may get your wish. Alderman Siegel made the proposal. It was adopted by the
Finance Committee. Now | like the proposal | made but if you’re going to switch the money, | think
police overtime is a good place to put it.

Paula Johnson

| thank that the police just need to get out there and we need to focus on something else other than
this opioid crisis because we all live in the city and we all need the police protection. It’s a sad thing

Special Board of Aldermen Public Hearing Page 12

what’s happening not only in the city around the country. Like I’ve said to people, maybe we should
take a look at the doctors, the pharmaceutical company, and the insurance company that keep
pushing this and maybe they should be contributing to some of this rather than the taxpayers. It
seems like the taxpayers get the bill for everything and there’s just so much money to go around.
That’s the first thing.

Mayor Donchess

And we are examining the question. Attorney Bolton is looking into the issue of whether the city could
join one of these lawsuits. Whether it’s feasible, I’m not sure because we haven't fully examined the
issue but one of the lawsuits where the pharmaceutical companies are getting sued because of the
over prescription issue and because of the contribution that that has made toward this rapid
expansion of the number of people that are abusing and addicted to opioid substances.

Paula Johnson

It’s not just the insurance companies. The doctors that write all these scripts. They’re part of it.

Mayor Donchess

Well maybe them too.
Paula Johnson

So is the insurance company because 30 days is cheaper than 5 days or 7 days to put a person on it.
It’s a revolving cycle here. It’s not just one, it’s them all. On page 60 in your department. | noticed
that the Specialist Assistant to the Mayor which was $62,120 no longer exists and now we’re having
the Chief of Staff to the Mayor for $81,915 and that is if by my calculations $19,795 increase for one
person.

Mayor Donchess

So what we have is the person who has taken on the job of Chief of Staff is really functioning as
really a Division Director — is working with the Division Directors and helping to guide city policy. We
used to have and it sort of gradually got eliminated but it was a really necessary position was the
Administrative Services Director. That was a position that made a lot more than that and it got
switched into City Staff. The bottom line is that in order to make that possible within the amount on
the spending cap, we made other cuts. If you look, and we gave this analysis to the Budget
Committee, if you look at a combination of all the city hall departments, general government, financial
services, information technology, etc. and you see the bottom line of those departments, they are
only up .7 percent. For example we cut a position out of city hall, an unnecessary messenger
position which more than compensates for that increase. It is not really a raise because it is a
restructured position. The job description has been altered. That has not been implemented yet and
it won’t be unless it’s passed in the budget. | think it reflects the level of responsibility in fact, the level
of responsibility is even higher than this. It reflects to some degree the level of responsibility of the
person doing the job.

Paula Johnson

Only in government can this happen. So let me ask you a question.

Special Board of Aldermen Public Hearing Page 13

Mayor Donchess

That’s not true only in government. When someone in the private sector gets a promotion and their
job is restructured, they sometimes get raises. That happens so it’s not only in government.

Paula Johnson

Well Mayor it’s pretty sad when government employees are making more money than the private
sector right now because there were no jobs for like the last 8 years and now we’re just starting to
see a little bit of growth and companies wanting to create more jobs now.

Mayor Donchess

Let me ask you this question. Would you have rather we leave the pay as it was and leave the
messenger in the budget and then we’d be spending more or would you prefer that we cut the
messenger position, save $30,000 or $40,000, and restructure this position and pay it $20,000?

Paula Johnson

You know Mayor if | was an administrator if | don’t need that position, it goes and if this person can do
the job at this salary, | wouldn’t give a $19,000 increase. Maybe a $2,000 or $3,000 increase but not
a $19,000 increase when the budget is so tight. Remember | read at the beginning. How tight is this
budget? Well if the budget is so tight, you would streamline government or streamline where you
need to be. Positions that are no longer needed would be gone and it does not mean that somebody
because they’re getting a different title and you restructured the whole job description qualifies for
almost a $20,000 increase. So how tight is the budget?

So now I’m going to follow this up with another question.

Mayor Donchess

Now wait. You asked me how tight is the budget. I’m saying it’s very tight because in the city hall
departments if you include all of them — Community Development, Public Health, Information,
Financial, general government — all those combined are only up less than 1 percent. | think that’s a
pretty tight budget. This is one of the changes that was made within that area but I’d say that’s pretty
tight.

Paula Johnson

Well you could give less of an increase on a job description change. | guess that brings up my next
question. When you have a new position in any department in the city, do you always have a new job
description to go with that position or do you just put that position in and then make a job description

based on their qualifications? So with the job description based on the qualifications for what you
need for the job or is it based on the person’s qualification that you want to put into that job?

Mayor Donchess

| didn’t totally understand the question.

Paula Johnson

Okay. When you hire somebody, you hire them for the job description what you need them for in that

job. Now if you have openings and you don’t have a job description, do you put somebody in there
let’s say isn’t qualified for a position and then you make the job description after. So by right every

Special Board of Aldermen Public Hearing Page 14

position in the city should have a job description plus what the qualifications is for that job? Am |
correct?

Mayor Donchess

| think every position does have a job description.
Paula Johnson

Okay.

Mayor Donchess

If there are positions without job descriptions, then | will ask Human Resource Director to make sure
we do have job descriptions.

Paula Johnson

| just want to make sure that when you hire somebody it’s based on the job description and their
qualifications that they’re going into that position to meet those qualifications not that you might not
have a job description and you’re going to make the job description around that person’s qualification
to put in the job.

Now | know there were some other things. You just brought up about what Mr. Teeboom about
different communities like Hartford, Connecticut, and other places, bringing jobs in so we can move
this city forward. Some of it was — or maybe it was me — with the $200,000 in communities like

Hartford, Cambridge, and Lawrence and all that. Can you define for me are we a welcoming city or a
sanctuary city here?

Mayor Donchess

We're a welcoming city. | think in the end contrary to my wishes, the aldermen may change that
participatory budget based upon on what I’ve heard. We'll see. Maybe we shouldn’t spend too much
time on that. We're a welcoming city.

Paula Johnson

What’s the difference between a welcoming city and a sanctuary city?

Mayor Donchess

| don’t really think that has much to do about the budget.

Paula Johnson

| think so. | think it does when anything that federal funding...

Chairman Dowd

Ms. Johnson is that a question relative to the budget?

Special Board of Aldermen Public Hearing Page 15
Paula Johnson

Yes because that’s federal funding that comes into the city. We get federal funding don’t we? We do
get federal funding that comes into the city so I’m just want to know what’s the difference between
sanctuary and welcoming. We do get federal dollars. It is germane to the budget.

Chairman Dowd

| think that’s a stretch for discussion of the Mayor's Office.

Paula Johnson

It is germane to the budget. We do get federal dollars. Now the other thing is again how tight is the

budget? We’re talking about the $15.5 million and we’re negotiating with Alec’s for about $2 million
for their building. Is that money going to be bonded? Become bonded debt?

Mayor Donchess

We're negotiating with whom?

Paula Johnson

With Alec’s for the building with John.

Mayor Donchess

If the city were to move ahead with a performing arts center, yes that would be a bonded purchase.
Paula Johnson

So that’s more bonded debt. That is germane to the budget.
Chairman Dowd

It is but we are going to talk...

Mayor Donchess

But that isn’t in the budget at this point.

Paula Johnson

But street paving is right - $7.5 million? I'll come back later with more of that in the school district.
Thank you.

Chairman Dowd
Any other discussion on the Mayor’s Office?

Gary Hoffman

Gary Hoffman, 18 Harbor Avenue, Unit 104, Nashua, New Hampshire. | would just like to thank the
people who created this budget. As a citizen, | got to say the layout of this budget if people look at all

Special Board of Aldermen Public Hearing Page 16

the different pages and the introduction, it’s really like a management by objective model. | like the
fact | can see what the city has done and | like to see where we want to go. So what’s kind of in
charge of leading this? | really want to commend them for that because | haven’t seen many budgets
like this in Nashua. I’ve seen ledgers before and a narrative in the beginning but this really tells me
the story of what you’ve done this year and where you want to go. Thank you for that. | just want to
say one quick thing about the 1/10" of 1 percent that was set aside for participatory $200,000 to allow
the citizens to actually get involved and spend some money. | really think that’s a fantastic idea and |
don’t understand why a few people are so up in arms about it. This has been tried as Mayor
Donchess said in other places. It’s a great experiment to kind of take some decision making and
putting it to the citizens. It really could increase community engagement. | wanted to let you know
that a lot of people do like that idea. | love that idea. I’ve read in places where it worked. If we don’t
get that this year, think about trying to get it next year because | think it can really have a lot of
positive benefits. Thank you for the people who spend so much time on creating this budget. | think
it's fantastic how you laid it out and everything. Thank you.

Chairman Dowd

Thank you. Anyone else for the Mayor’s Office?

Joe Pacello

Good evening. Joe Pacello, 38 Raleigh Drive, Nashua, NH. Three quick questions | guess. One is
the $9, 10, 11 million or whatever it was that was carved out of the budget to create the gap under the
spending cap. Was that taken out of the base as well?

CFO Griffin

No that wasn’t taken out of the base.

Joe Pacello

So why wouldn’t that be taken out of the base?

CFO Griffin

It's never been done since I’ve been here and | don’t think it was done prior to me being here. The
base is approved by the Board of Aldermen annually and that was the starting point.

Joe Pacello

So what year is the base year? Forgive me I’m new at this. | would just assume that if the equation
you would take the money out of the base as well as the new year. That’s just a question.

CFO Griffin

The direct answer to your question is the base was created by the Board of Aldermen’s approval of
the fiscal 2017 budget.

Joe Pacello

Wasn't the base established 10 or 15 years ago?