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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?

Special Board of Aldermen Public Hearing Page 17
CFO Griffin

For the purposes of the calculation, the base can increase or decrease each year based on the
approval of the Board of Aldermen’s deliberations and then final budget passage.

Joe Pacello

Two other questions just on the expense side and benefit side. | understand the difficulties in the
benefits. I’ve worked in the private sector for many years. I’m retired now. What is the contributions
the employees are making toward the health benefits and is that comparable to the private sector?

CFO Griffin

The employee’s contribution is 20 percent for an HMO and 30 percent for a PPO.
Joe Pacello

So that’s probably in line with the private sector.

As far as the pension goes and health insurance for that matter. | know we’re upon the year now so
it's hard to make these kind of decisions but going forward for the next 2, 3, 4, 5 years, what’s the
plan to work at getting those numbers down? In the private sector, pensions are by the way the dodo
bird. There are no more pensions per say. They’re more 401Ks or 403Bs. Are there plans in the
works for the future to get that more in line with the private sector?

Mayor Donchess

You may have heard before that we’re in a State pension system. At this point it is a State mandated,
a State run State system. We do not negotiate pensions with any of the unions. That’s a common
misperception that somehow we have negotiated or that these are in the union contracts. They’re
not. As Mr. Teeboom mentioned at some point but it was numerous decades ago, the municipalities
were induced to enter the State pension system through the promise that the State would contribute
35 percent of all municipal pension costs which they did for a whole number of decades until about
2008. Then over a period of several years, they reduced their promised contribution to 30 to 25 and
then to zero percent. That’s one of the largest causes of the increase in the city’s pension budget.
Even though as you’ve already heard, the State is recapitalizing the system and most of the money is
going to try to build up the reserves which now stand at $7.5 million. Even though that’s going on if
the State were still paying their 35 percent, it would reduce our budget by about $8 million. The city
through its legislative delegation, Alderman LeBrun, Alderman O’Brien, and others in the legislative
delegation sought to change the way the State approaches the pensions in various respects. One of
which was to begin to not get up to 35 but to at least begin to restore some of the contribution they
used to make. None of those bills passed. The way to change the pension system or to get the
State to again participate is through the State legislature.

Joe Pacello

Right so if the State does not acquiesce is that upon to decide if we want to participate in that model
into the future or are there ways to get out of that?

Mayor Donchess

Well right now State law says we have to remain in unless we do a few things. One would be to pay
them so that the system is also undercapitalized at this point. We'd have to pay hundreds of millions

Board of Aldermen Page 2
June 28, 2016

| wanted to mention R-16-049 which proposes that we explore and enter a sister city relationship with Mysore,
Karnataka State, India. | don’t know what committee this will go to but when it does we can come and explain
what might be gained by this. We do have a large population of Indian American citizens here in Nashua.
Most of our Indian American comes from two states | India, first the city that Mysore is in which are Karnataka
and also Andhra Pradesh. | think that by doing this there are things that we can gain in terms of the citizens
that we have and hopefully improving our relationships with another significant democracy and trading partner
in Asia. When | was Mayor before we did have a sister city in Korea, Yesan County which is just south of
Seoul and we sent a delegation there one time; | and several Aldermen, a school principal and others went to
Yesan County and they had delegations come here but that has lapsed. This relationship | think is more
sustainable because we do have a whole group of citizens here that really want this to happen and will help to
foster it. The sister city relationship with Korea was mostly promoted by one gentleman, Mr. Chung; whereas
now we have a much larger group of people who reside here in Nashua. | hope you consider this carefully.

| did want to mention that the trolley has been a very fun and successful addition to downtown on Friday and
Saturday nights. My wife and | have ridden on it a few times and the people riding on it seemed very
enchanted with it and the drivers have done a really good job at attracting people to use it. | think it has helped
to promote new life and good time’s downtown on Friday and Saturday nights. | think it's been going on now
for about 4 weeks.

Finally | would like to mention Carolyn Choate has formed a Beautification Committee for the city and has
organized a group of people to begin working on different projects. Over the past weekend they worked and
cleaned up a lot of brush near the Court Street Building and | think they have other projects in mind and | want
to thank them for all of their efforts in helping us to have a beautiful Nashua. Beyond that, Mr. President, |
don’t have anything.

RESPONSE TO REMARKS OF THE MAYOR - None
RECOGNITION PERIOD — None
READING MINUTES OF PREVIOUS MEETINGS AND PUBLIC HEARING

There being no objection, President McCarthy declared the minutes of the Board of Aldermen
meetings of June 9, and June 14, 2016, accepted, placed on file and the readings suspended.

COMMUNICATIONS
There being no objection, President McCarthy declared that all communications be read by title only.

From: Jeffrey L. Snow, Superintendent, Edgewood Cemetery
Re: Request for Joint Convention with Edgewood Cemetery Board of Trustees

There being no objection, President McCarthy declared the communication accepted, placed on file
and that the Board of Aldermen meet in Joint Convention with the Edgewood Cemetery Board of
Trustees on Tuesday, July 12, 2016, at 7:30 p.m. in the Aldermanic Chamber

From: Mayor Jim Donchess
Re: Award of Nashua City Wide Telecom Project

MOTION BY ALDERMAN SIEGEL TO ACCEPT, PLACE ON FILE, AND AWARD THE CONTRACT TO
CUSTOM COMPUTER SPECIALISTS, INC. IN THE AMOUNT OF $2,200,000

Special Board of Aldermen Public Hearing Page 18

of dollars to the State of New Hampshire to get out of this system. That’s just not really feasible.
We're locked in.

Joe Pacello

| think my only point is that we kind of need to look more out into the future and model these benefit
plans as opposed to just explaining it away by what well we can’t control it. Well there’s got to be a
way to control it. That’s my final comment but thank you very much.

Chairman Dowd

Any other comments of the Mayor’s Office or the first 58 pages of the budget?

Christina McKinley

Christina McKinley, Southgate Drive, Nashua. My comments are easier because of those that came
before me. I’m extraordinarily pleased that we have people presenting that are talking about the
numbers behind the budget that most of us are not going to dig into all the details. VWhat I’m hearing
I’ve sat at one other meeting and so | will not have to say as much because of what’s been said
before me. | would agree that it is not acceptable to say that the problems that are in our town now
can’t be addressed because they’re controlled by the State. | think that’s unacceptable. | think it’s
unacceptable in part because the people who are going to support the decisions that were bad, that
were inflated, that were really under fundable, years past are the ones that are going to be paying
those inflated salaries, inflated pensions, all of that now. Most of those people do not have pensions
themselves. | think that perhaps one way to look at this would be to say that city government unless
we’re going to have as we have nationally this sort of government elite that is supported by taxpayers
that those folks should really not be able to be paid within some percentage anyway more than the
people then are paying them. | didn’t hear anything refuted.

| haven't investigated this but the numbers that Mr. Teeboom presented are extraordinary. The
amount of money that we are paying in pensions to people are way higher than many people’s
regular salaries in the private sector. In addition what | heard in terms of what the percentage that
health benefits are the contribution, | have worked in the private industry a long time and | have had
50 percent charged to me for health care and 100 percent for any family member. The company paid
for my insurance not my family’s insurance. That is not uncommon. | just think that there are an
awful lot of budget items that we have sort of acquiesced to a place where we say well there’s nothing
we can do about it. We've elevated to this level and we cannot back up. We have enough examples
across our country of what has happed to towns that don’t do something in advance of a terrible
situation where people lose pensions entirely. People lose jobs entirely because cities go bankrupt.

| think that we need to look carefully now as people in advance of me have suggested and if we’re
looking at it — if that number was accurate that we have a 20 percent reduction in the number of kids
in the schools in this town and yet we keep adding to the budget, there’s something wrong.
Something really wrong. Perhaps we need to be looking at what the problem is deeper and why we
are continuing to support things that don’t match up with the people who are in our schools. The
students that are in our schools. That wouldn't in any private industry I’ve ever been in would that
budget fly.

The one other comment that | heard about the opioid crisis and we all feel bad when anyone has that
kind of problem. | would like to make note — | hope we are spending as much time and energy
focused on supporting kids and adults who are doing the right thing. Who are taking positive steps
as we spend towards people who are choosing not to.

Special Board of Aldermen Public Hearing Page 19
Chairman Dowd

Is there anyone else that would like to speak to the first part of the budget or the Mayor’s Office?
Paula Johnson

| love this woman. | think she was just spectacular. Question here. You added a restructured

position Mayor from Public Works that’s going to be in your office now — a PR person or is that going
into Public Works?

Mayor Donchess

That position is not a new position and it’s in Public Works. It’s a person who answers constituent
calls and tries to explain for our Public Works Department Division what their activities are.

Paula Johnson

| just want to follow up. What is the average deductible and out of pocket for city worker’s healthcare
benefit?

Mayor Donchess

| think we need Mr. Budreau to answer the questions of how much a city employee on average pays
for health insurance. | would say the number is about $14,000 per person depending on the plan. |’ll
let Mr. Budreau answer that.

Director Budreau

Good evening. Yours was a question of the plan design the average deductible and out of pocket.
Paula Johnson

Well if you go to the doctor like | have a $2,000 per person.

Director Budreau

We have several plan choices. Many of the employees are in an HMO and that’s a $20 co-pay plan
for most visits and it’s a $250 single deductible and a family deductible of $500 or $750 for outpatient
surgery and the like. We're encouraging employees and we now have about 250 in the high
deductible health plan. That’s a $2,000 individual deductible, $4,000 family deductible.

Paula Johnson

That’s the average what’s going out there in the private sector now. How much is the long term?
How much do they have to take out before everything is totally covered? | know my husband’s is like
$6,000 total. That’s totally out of pocket.

Director Budreau

The high deductible plan is $4,000.

Special Board of Aldermen Public Hearing Page 20
Paula Johnson

So the private sector is still higher than the city than what we pay for city employees.

Director Budreau

| can’t speak to the private sector. | can just tell you what we have.

Paula Johnson

| can speak to the private sector because | see the plan every year — my husband's health care plan
jumped up from $1,000 - $1,500; $2,000 now $6,000 — two people out of pocket. The cost of it is
going up and | know that we’re paying for it here. Thank you.

Also | want to get back to one other thing. I’m done with the healthcare. | want to get back to the
kindergarten and | want to touch on what Mr. Teeboom said and what that wonderful woman said
about it. We are giving full day kindergarten. We have half day now and we're going to implement it
throughout the city. | totally believe and when Alderman LeBrun made a comment, it was a horrible
comment that | do believe is more babysitting because people drop off in the morning and then
before school and will have after school 5:00 — 6:00 at night. I’ve heard studies talk about that kids
do not need kindergarten full day. The time needs to be socializing with other kids and play time.

Chairman Dowd

Ms. Johnson, that’s going to be brought up during the school...
Paula Johnson

Well everybody else brought it up. Okay fine. Thanks.
Chairman Dowd

Anyone else for the Mayor’s department?

Fred Teeboom

| won't be here that much longer but the previous speaker brought up the effect of what you call
“government elite”. The ring to that is true and here’s why. | mentioned some of these outrageous
retirement benefits that some people get. I’m never going to get those outrageous benefits. You
really have to spend a lifetime studying how to really maximize and implement. | wrote a guest
editorial back in January 22. | addressed the question about what’s your average retirement pay.
The average retirement pay and that applies to whether you stay a couple of years or you stay 40
years. Average retirement pays $21,000. That’s okay and then they out, quit, and collect social
security benefits. The average retirement is 21.

The average police officer retirement and few of them wait until 65 to retire. Many of them retire after
20 -25 years. The average police $36,000 a year. The average firefighter — $39,000 a year and then
they can get another job and collect on their social security. So the question | also asked is what is
the social security benefits? Social security benefits by comparison if you work for 35 years, made
$108,000, and you retired at 65, the very most — so the maximum you can make in social security is
$31,000. The average however in social security recipient in this country is $16,000. Compare that
with the $22,000 average, the $36,000 and we truly have what | call a government elite. A
government elite when they work and get all these benefits, the government elite when they retire and