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Special Board of Aldermen Public Hearing — May 20, 2020 Page 8

Let’s go to the next slide. This tells us that Proposed Operating Budget is $284 million dollars. Now this is an
increase from the current Fiscal Yar of $8.9 million dollars. If you break that increase down, without that one
healthcare line that I’ve discussed, the Budget is only up 2.1%, it is around the cost of living, all the other line
items put together. The one line item of insurance as we have already discussed is $3 million dollars. So of
the $8.9 million, $3 million of that is the one line item. If it were not for that, the Budget would be up 2%.
Instead, in total it is up a little over 3%. Now in terms of the revenues that are projecting that we will receive
in Fiscal ’21, we are budgeting those conservatively, we don’t want to overestimate revenue, especially with
the economic climate we are facing. We will continue to be in a low interest rate environment; this means
that the City will not be earning a lot of money on the accounts and reserves that we hold so there will be
some, a little bit of income this way but not a great deal. We need to think about the potential of a reduction
in State Aid as a result of the State being hit also with the financial and fiscal impacts of COVID-19. That
could play out in subsequent years, not just in the year to come. We hope that will not happen; we have to at
least keep it in mind as a possibility.

Now | want to go to the Fiscal ’21 Budget Challenges and we will get into more of the details here as we go
on from here. As we have mentioned, we face potential reductions in State Aid and also in local revenue;
automobile registrations and other sources of revenue that the City gets beyond property taxes. As we have
already discussed, the second big bullet, the cost of City-provided healthcare were last year and this a major
challenge again. And as a result of these challenges, the proposed budget requires that the School
Department, the Police and Fire Departments and the Department of Public Works all live with a 2.25%
increase in the Budget. And of all the Departments that have submitted budgets higher than this, | have
reduced those budgets to 2.25. Now just to be clear, the Financial Team and | issued guidelines to these
Departments back in January saying that no proposed Budget should be over 2.25%. However we have
various Departments who are independently managed and they submitted higher budgets but | reduced them
to 2.25%, our target, which | am very glad that | did now that COVID-19 has hit because we need to be more
cautious than ever as a result of COVID-19. All other Divisions, other than the major ones that you see,
were held to a 2%, plus or minus, increase.

Now let’s go to the next slide. | have touched generally on State Aid, | just wanted to show you what this,
what the major components of the State Aid will be in Fiscal ’21. First of all, there is a portion of the Rooms &
Meals Tax that is collected by the State of New Hampshire that goes to cities and towns. Nashua’s share of
that money is $4.5 million. Now there’s a weekly call with the Governor that the Mayors across the State
have and | have asked the question — Well obviously Rooms & Meals revenue are down for the State, is this
number safe? Now the Governor's response has been, “yes, it is, because by Statute the amount being
distributed to cities and towns is a given amount and is not tied to revenue”. But that law could be changed,
so | think for the short-term we should consider this relatively safe but be aware that who knows, we don’t
know what is going to happen.

There is a highway block grant of about $1.6 million dollars, now we direct this totally into paving. That is
funded by gas tax, that probably is safe but we are not sure. We are not sure if the whole thing will come
through. Then we go to the most significant paid and that is the State Adequacy Grant for our Schools. Now
that is shown at $35 million dollars, it gives a bit of a misimpression because most of this money we collect on
our property tax bills. If you look at the tax bill it says “State Education” or something like that; most of that
we collect right here in Nashua and is never sent to the State but it’s treated as though it is State Aid. But in
any event, a portion of this does come as a direct check sort to speak and you have to ask the question,
could that be affected? And again, we don’t know for sure, we are projecting and thinking maybe not, but we
don’t know for sure.

And finally you see one-time revenue, now this is the one-time revenue | have referred to before. This is one-
time State Aid that we are going to get this year and definitely not again. This is potentially $2.9 million for
schools and $1.8 million for the City; again one-time revenue which we should be very careful about
expending, because we should not add this to Operating Budgets because the money will not be replaced
and in the end if anyone did that, we would be creating budgets which are not sustainable in the future.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 9

We will go the next slide. Here is a slide that looks at how will our tax base be affected if COVID-19 creates
a weaker economy in the mid or long-term. Of course, we are going to do everything we can and | will
discuss some of the steps, the action that the City is taking to try to assist our local businesses with recovery,
when the economy and as it opens. But the National Economists say there could be a recession. We know
that many businesses have revenue that is off very significantly, especially in certain industries like
hospitality, restaurants, other things like that, airlines. So the question is, will it erode our tax base and cause
property in the City to be worth less especially commercial property like malls, like strip malls, the regional
malls and other office buildings. The first bullet says, to be transparent and frank with you, we don’t for sure
what is going to happen. We don’t know if this will reduce commercial values or not. But the second bullet
tells you what the impact of lower commercial property values would be. It would mean that you would collect
less money from the commercial sector. The Malls, the Offices, the Strip Malls, the Restaurants. We would
collect less money from them which would push more tax burden on to the homeowner.

We haven't seen a huge, huge recession that impacted commercial properties heavily since the early 1990’s
but | was there, | was Mayor then. In a major recession, commercial values can do down much more quickly
than the value of single-family homes and condominiums for example. So you see the impact on the
commercial sector much more quickly if there is a recession, the decline in values if it comes is steeper for
commercial properties than for single family homes. We know that the economy will recover, but we don’t
know when and that’s the truth of it. That’s the kind of hard reality, we are hoping, we are praying that things
will come back pretty quickly and within a short time, we will be back to where we were before. But we don’t
know that for sure, there could be a recession. Nashua’s economy has always been strong, Nashua people
work very hard, work well together so | have full confidence that we will come back by sticking together, but
we don’t how long that might take.

Now let’s go to some of the immediate effects we must consider or take into account when we are thinking
about the Budget. First of all, we know that right now many Nashuans are hurting. No question about it. We
know from the State’s statistics that more than 8,200 people from Nashua have applied for unemployment
benefits since March; this is just since March, middle of March, over 8,000 people. That is a lot of people.
Now those people may return to their jobs as the economy opens, but right now, 8,200 people and more are
unemployed. And | say “and more” because this only includes the people from Nashua who applied for
unemployment because they work for a New Hampshire company. It does not include our Nashua residents
who work in Massachusetts and have been laid off or furloughed down there. We don’t have a firm figure on
how many Nashuans have been affected down in Massachusetts but we do know that 30% of the people
who are employed here in the City, commute into Massachusetts. So we know that more than it could be 10,
11, we don’t know, but we know that significantly more than 8,000 people are currently unemployed.

The State is saying that the COVID-19 unemployment is 15.8%. So these are difficult economic
circumstances. Many of our fellow Nashuans are suffering from this. The Federal Government has provided
a supplement to unemployment benefits which is great, but that’s not going to last forever. Now, again, |
have full confidence that we can recover, but we can’t look at these statistics and all of this information, we
can’t listen to people who are out of work and how worried they and their families are, | certainly have talked
to a number, without taking into consideration that recovery may not be immediate. We may have to work
hard over a period of time to make sure we come back strong. So here we are going to the next slide,
please. The slide has frozen, | don’t know what’s happened.

John Griffin, CFO

| am having trouble with it.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 10

Mayor Donchess

That’s Mr. Griffin. | can address it without, so we will leave that up and | will talk through the next information
and we will get it up on the screen if we can. | am recommending and | have discussed this with some of the
Aldermen that the one-time State Aid that is projected to be spent on various one-time items, that that
expenditure be reduced by $1.9 million dollars and that $1.9 million dollars of this one-time State Aid be
directed to tax relief and that would be split between the School side and the City side. | am recommending
that under the circumstances that we have outlined, that there should be no increases in the Proposed
Operating Budget above the 2.25% for Schools, Police, Fire and DPW. With 8,000 people unemployed, with
downtown - at the least the downtown economy largely shut down for 2 months — my opinion my
recommendation is we hold the line on any increases, and we apply an extra $1.9 million to tax relief.

In addition, we need to make sure that the new plan design is included in all Collective Bargaining
Agreements. We cannot approve, in my opinion, Collective Bargaining Agreements that enable health
insurance costs to continue to escalate the way they have now. We need these new deductible features and
the new co-pays, you know, all the healthcare so that we can bend the curve so that we can limit increases
and possibly, possibly even reduce the overall cost for the City and for our employees in the weekly
contributions that they make.

|, as Mayor, have instituted a hiring freeze for all non-essential personnel. Again, | want to reiterate that we
don’t know what is going to be happening over the next few months. We are working our hardest to think it
out and to project what could happen but we want to save as much money as we possibly can right now. So
any positions that are currently open and are non-essential, | have ordered a hiring freeze and for the time
being we will not proceed with those non-essential hiring and we will save the money to see how things
progress through the remainder of the calendar year.

Now | wanted to go to a little more of good news, again, | Know how difficult this period is. | know how difficult
COVID-19 has been to deal with. Closing down our lives has been very hard, but we are doing something
very important together. We are helping to save our community members; we are working to contain the
spread of the virus. So far 10 people in Nashua have died and that’s tragic. But | know by taking the steps
we have taken together, we have saved a lot of lives and as we look back on all of this, down the road, we
will be proud of what we accomplished in terms of attacking this virus with a totally unified action. All of our
City Employees and our Residents working together.

Some of the things that have occurred over the last couple of years, | wanted to remind you of because we
have a great City. And | am very proud to be the Mayor of it. In 2019 we were the 8" Safest City in the United
States. We were awarded Best Suburb in New Hampshire, suburb of Boston that refers to. In 2019 we are
rated the 13" Best Run City in the United States. In 2018 we were named one of the Safest Places to Retire
in the Country. In 2018 we were also named one of the Best Run Cities in the Country, | think we were
actually 8" that year. In 2018 it was said that we were the best place for millennials in Hillsboro County. We
are the most inclusive place to live in New Hampshire. We have a triple AAA Bond Rating which is
something we do not want to put at risk by doing anything unwise financially. We have a triple AAA Bond
Rating from both S&P, Standard & Poor’s, and Fitch, two ratings agencies. When | came into office, we had
one triple AAA, now we have two and Nashua 2018 has among the lowest crime among mid-sized cities in
the United States.

We have a great City, we are facing a few difficulties, challenges that | know we can come through. We are
unified, we are determined and we are going to come out stronger on the other end. But! am urging, no
question about it, caution when it comes to considering this years Budget. And that is my conclusion, Mr.
Chairman. Of course, | am available for any questions.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 11
Chairman Dowd

Ok, thank you Mayor, if we could put the presentation down. OK. Now for those who may have logged on
late, this is the first time we are doing the Budget Presentation in this format, so be patient and everyone will
have an opportunity to speak. You will have 5 minutes; | have a timer here. When you get to 4 minutes, I'll
tell you, you have one-minute left. If you want to make a comment or if you have a question for the Division
that we are talking about and the Department, you may ask it at that time. Ve can’t go back until the end.
All questions this evening must be solely on the FY2021 Budget, no other subjects should be brought up.
Please stay on mute and no video until | call on you.

We are going to start with the Mayor’s Office and if you want to be recognized please go video or state your
name and | will call on you. Give your name and address for the record, please.

Laurie Ortolano

Hello?

Chairman Dowd

Yes? Laurie Ortolano?

Ms. Ortolano 41 Berkeley Street.
Chairman Dowd

You have 5 minutes.

Ms. Ortolano

The Mayor spoke about essential and non-essential positions and that we were holding off on non-essential
positions in the Budget. Did | understand correctly that they are in the Budget and is there a list available of
the essential and non-essential positions so that a resident can know how many positions are there and
essentially what kind of growth that put (audio cuts out) into the budget?

Chairman Dowd

Mayor, do you want to address that?

Mayor Donchess

Yes, let me unmute myself, I’m sorry. So | think | used essential and non-essential in two different ways.
Certainly in terms of who is working remotely, we have developed a list of non-essential and essential
positions that have been done by Emergency Management and a team of people, Justin Kates, and a team
of people. And what we mean there is that non-essential positions don’t have to be on the job, they can work
remotely. For example, some IT functions can be performed, even though we need those functions, they can
be performed remotely and therefore don’t encounter any COVID-19 risk. On the other hand, we have First
Responders, we have Public Works, other people who have to be on the job that cannot work remotely.
Those are the essential positions that cannot work remotely. So that’s the way those terms, at least | have
used them and the City has used them in the context of redesigning City operations to (audio cuts out) safely
with COVID-19.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 12

In terms of the open positions, open positions, the hiring freezes, there are some positions open and we
really look at those on a case-by-case basis to ask the question, OK there’s an open position, do we need to
fill that right now? At some point we might need to but do we need to do it right now. If the answer is No, we
can defer it, the hiring freeze would defer those positions, we save some money while we are waiting and in
the delay that results from the hiring freeze. That does not mean that someday we won’t fill those positions
but right now we don’t think they are necessary to today to fill the job.

Ms. Ortolano So can a citizen get a list of what those positions are within the Budget that you looked at? |

mean you explained essential and non-essential from Emergency Management and | understand that but |
am really talking about the Budget. Is that something that is available or not, | just don’t know.

Mayor Donchess

The ones we are looking at are the open positions, meaning people have resigned or retired or whatever.
There would be a list of the open positions that currently exist, yes. That is somewhere.

Ms. Ortolano OK.

Chairman Dowd

You have a couple minutes left.

Ms. Ortolano Just one other quick one then. Healthcare — | was curious, | am glad you addressed the high
deductible plan that you brought forward. It was my understanding and | might be wrong, that the sign-up

period for that might have happened. And if it did, can you tell us how was the response for switching into
that plan and what is the cost savings associated with that?

Mayor Donchess

| think that we should turn the question over to the Administrative Services Director, Kim Kleiner, who can
give more detail. But in general, the high deductible plan because it encourages, it incentives shopping and
the determination — Well if | can get a service for $500.00 over here and it’s the same qualify for $200.00
over here, I'll take the $200.00. They are incentives, but I'll let Director Kleiner, who | assume is on the call,
talk about the details of how that plays out with respect to individual employees.

Chairman Dowd

Director Kleiner?

Kim Kleiner, Director of Administrative Services

Alderman Dowd, yes. So right now the Board of Aldermen has approved the high deductible plan and the
health design changes for the unaffiliated employees. We are currently in the middle of Open Enrollment. It
was extended until this Friday the 22™ so we are projected to have some data available next week on how
many employees have switched over to the high deductible plan. Originally, it was thought that we would
have this information as of last Friday. We extended Open Enrollment due to Open Enrollment now going
virtually and some hardship that we incurred getting that process up and running. So that data would be
available, hopefully, by the end of next week.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 13
Chairman Dowd

OK time has expired. So if we get through other questions, we could come back. Is there anyone else that
has a question relative to the or in general or the City Budget or the Mayor's Office.

Beth Scaer | do.

Chairman Dowd

Your name?

Beth Scaer 111 East Hobart Street.
Chairman Dowd

OK, go ahead.

Ms. Scaer Why hasn’t the City cut any positions and reduced staffing with this, you know, pandemic hanging
over our heads.

Mayor Donchess

Well if anything the pandemic has increased the amount of work. We’ve got people working 7 days a week
on many things. First of all we’ve got our Public Health Response, | could get into the details of what Public
Health is doing but they are working 7 days a week to limit the spread of the virus. Our Frist Responders are,
of course, still working and are just as necessary as possible, just as necessary as always, actually more
necessary as a result of the virus and the crisis. Our teachers are teaching remotely. Now that’s easier said
than done. My neighbor across the street who has a few kids, commented, | thought teaching was easy but
given that I’m now in charge of making sure my child does their homework; easier said than done. So our
teachers are teaching remotely and those are the major employee groups.

We have a number of people in the City who are working remotely and doing their normal duties. Certainly,
there are some employees who will, in the short term, at the library, there are some employees who are likely
to be furloughed. | think they’ve been informed of that by now. So there are certain changes that have been
made and, of course, we have the hiring freezes that has been in place so we are holding certain positions
open.

Ms. Scaer Ok, thank you.

102 BOARD OF ALDERMEN
103 LEGAL DEPARTMENT
Chairman Dowd
Anyone? lf not — does anyone have an additional question for the Mayor’s Office or the General Budget?
Seeing none, we are going to move on to the Board of Aldermen and that is part of General Government.
Any questions on the Board of Aldermen’s portion of the budget? | am seeing none. So! am going to move
on to the Legal Department, any questions relative to the Legal Department? Hearing and seeing none we

will move on to the City Clerk’s Office.

Ms. Ortolano Hello?

Special Board of Aldermen Public Hearing — May 20, 2020 Page 14
Chairman Dowd

Yes?

Ms. Ortolano Can we just jump back to the Legal Department really quick. Ok can you say who you are?

Laurie Ortolano I’m sorry | hadn’t turned my video on, I’m getting the buttons going. Laurie Ortolano, 41
Berkley Street.

Chairman Dowd

OK.

Ms. Ortolano Does the Legal Department include all of the consultants that are used on various projects or
litigation? For example, if they bring in a consultant to address abatements, is that in the Legal Budget or is
that put somewhere else?

Chairman Dows

Attorney Bolton, you are on mute.

Steve Bolton, Corporation Counsel

It is not in the Legal Department’s Budget.

Ms. Ortolano Can you tell me where it is?

Attorney Bolton

In the example that you offered, that would be in what we call the “overlay”.

Ms. Ortolano OK | am familiar with that. And what about for consultants we hire, to do like Attorney Broth
who came in and did his investigation. Where does he come out of?

Attorney Bolton

| don’t necessarily know, it would be whatever Department was using Attorney Broth or some other attorney,
it would either be their budget or some appropriation from contingency or elsewhere to pay those expenses.
But that would not be in my budget.

Ms. Ortolano Ok, and then one last quick question. Are there are other legal services, | mean I'll just speak
candidly, | was certainly somebody who the City viewed as having a big impact on the legal costs and raising
the Budget $100,000.00. Where does that get logged?

Attorney Bolton

| would say that’s a complete exaggeration; we got an additional appropriation to provide for some overtime
in order to respond to some of the Right to Know requests that you generated; others as well but yours were
included. But that was much, much less than $100,000.00 in the Legal Department.

Special Board of Aldermen Public Hearing — May 20, 2020 Page 15
Ms. Ortolano OK | think | am going off an article that possibly the Mayor had given a quote to the paper that |
had run up the cost about $100,000.00 grand and | am only going off of that because that was a number

thrown out. Now | don’t care — | think, | recall at some point $50,000.00 was added but is that in your Budget
or was that in somebody else’s?

Attorney Bolton
There was no $50,000.00 added to the Legal Department’s Budget.

Ms. Ortolano So it’s just overtime that | would see in the Budget that would account for whatever Right to
Know Requests were taken up.

Attorney Bolton

In the 2020 year, this doesn’t even talk about the projected budget of 2021, but last year, in the Fiscal Year
that we are currently in there was an addition made of $10,000.00 to pay for some overtime and that was
mainly the increase of Right to Know Requests (inaudible).

Ms. Ortolano Thank you, | did not mean to misrepresent that, | was just going off what had been in the paper
but thank you.

Attorney Bolton
You’re Welcome.
107 CITY CLERBK’S OFFICE
108 ENERGY MANAGEMENT
109 CIVIC AND COMMUNITY ACTIVITIES
131 HUNT BUILDING
158 PARKING ENFORCEMENT
166 PARKING OPERATIONS
183 ECONOMIC DEVELOPMENT

ADMINISTRATIVE SERVICES DIVISION

106 ADMINISTRTIVE SERVICES
Chairman Dowd

Alright the people that are on call in on their phones, please put them on mute. We are hearing paper
shuffling in the background and until you want to ask a question, please keep your phone on mute. | can see
several that are not on mute and if we get a lot of background noise, we will have to cut the person off.
Alright, now we are at the City Clerk’s Office. Are there any questions relative to the City Clerk’s Budget for
FY2021? Hearing and seeing none — Energy Management? Any questions on the Energy Management
portion of the Budget? Seeing and hearing none — Civic & Community Activities? Seeing and hearing no
one, | will move on to the Hunt Building. Any questions relative to the Hunt Building? Seeing none, going on
to Parking Enforcement, are there any questions or comments on the Parking Enforcement Budget?

Special Board of Aldermen Public Hearing — May 20, 2020 Page 16

Hearing and seeing none — Parking Operations? Any questions or comments on Parking Operations as part
of the Budget? Hearing and seeing none we will move on to Economic Development, are there any
questions relative to Economic Development Budget? Seeing and hearing none | am going to move on to
Administrative Services Division. And the Administrative Services portion of that Division. Any questions on
Administrative Services.
Ms. Ortolano Yes, | have a question.
Chairman Dowd
OK?
Ms. Ortolano Hang on | am turning on my video, so when you read a title, just so | know, | thought you were
going to go through each one. When there’s a big subtitle that’s all lumped together and all of those topics
can be addressed, is that correct?
Chairman Dowd

No | go through every single Department within those major titles. So Administrative Services Division is the
Division, then | go through each one of the Departments. So if you have a question on a particular
Department, you should bring it up when | read that Department. If you have a general question on
Administrative Services in general, you can ask it now.
Ms. Ortolano Ok so | am just going to make a comment on this one and then | have one down in Assessing |
will wait for, OK | understand. OK | am just going to say that from a position standpoint, | am a big believer
that the position that was needed in the City was a Chief of Assessing and that | find this to be a non-
essential position that got added to the Budget that we are paying a lot for when what we really needed was
a Chief. And that’s all | am going to say to that, | object to this position and the Department being funded and
the way it was done last year and | think it put an awful lot of expense on the back of the taxpayer when what
we needed was something else. But that’s all | am going to say.
Chairman Dowd
Alright, thank you.
Ms. Ortolano Yeah.

110 ARLINGTON STREET COMMUNITY CENTER

Chairman Dowd

Alright, next is the Arlington Street Community Center, any questions on the Arlington Street Community
Center?

Beth Scaer Yes, it is Beth Scaer.
Chairman Dowd
OK.

Ms. Scaer How much are we budgeting for that.

CHANGE ORDER

SUMMARY

CHANGE IN CONTRACT PRICE

Original Contract Price:

CHANGE IN CONTRACT TIMES

Original Contract Times:

$42,339.00 For the period: July 1, 2021 through June 30, 2022
Net Changes from previously approved Change Net Changes from previously approved Change Orders
Orders
$0.00 None

Contract Price prior to this Change Order:

$42,339.00

Contract Times prior to this Change Order:

For the period: July 1, 2021 through June 30, 2022

Increase Peerease) of this Change Order:

$40,795.00

Increase (Decrease) of this Change Order:

None

Contract Price with all approved Change Orders:

Contract Times with all approved Change Orders:

$83,134.00 For the period: July 1, 2021 through June 30, 2022
RECOMMENDED BY: ACCEPTED BY: ACCEPTED BY:

By: By: By:

(Authorized Signature) Contractor (Authorized Signature) Owner (Authorized Signature)

Jeff Lafleur James W. Donchess
Title: Solid Waste Superintendent _ Title: Title: Mayor, City of Nashua
Date: Date: Date:
Change Order #1 2 of 2

RFP0953-041321
Landfill Water Quality Testing