Board of Aldermen Page 4
April 12, 2016
it’s the third largest expense in the city budget at the salaries and benefits. In addition, there are already two
city expendable trust funds, one for the school and one for the city that have within those accounts a combined
amount of $700,000. Those two funds are set up through R-00-68; it is similar to what you have in R-16-016.
Earlier this year $150,000 was transferred to the city’s expendable trust fund through R-16-006 and in addition
to all of that there is $800,000 budgeted for the retirement and severance in the school department. CFO
Griffin presented a very fine briefing to the Budget Review Committee on R-16-015 but he did not mention the
end of year surpluses in any of his charts. | examined personally the financial reports and the CAFR for ten
years and found consistently end of year surpluses in the pension 52150 accounts. Last year the surplus net
account amounted to $1 million. The year before that the surplus account in that account amounted to
$870,000. | looked over the ten year period and there’s typical end of year surpluses in the account that
wanes near $1 million surplus. Alderman Siegel, who was a brand new Alderman, recognized this point and in
a Budget Review Committee meeting in July of 2014, he proposed cutting $400,000 from the budget fund,
52150, surpluses. That vote was adopted unanimously, to cut the pension fund. The question was asked with
all of these surpluses in the pension fund, why are those funds escrowed at the end of the year an expendable
trust fund of which already exists. Why do you need another pension trust fund on top of the ones that we
already have? There’s no emergency fund that we require, nobody is demanding that this be paid now, there’s
plenty of money available. | suggest that the real reason for this particular override vote is to come up with an
additional $3.3 million for next years’ budget because any supplemental budget you vote becomes a baseline
for next years’ budget. Take a look at the budget book on pages 10 and 11; it gives you a detailed analysis.
To emphasize this point Mayor Donchess members of the school board on 23 March was asked this question.
You gave us 2% and everybody else got a 1% increase in next years’ budget, how are you going to pull that
off? Somebody asked are you expecting this $2.23 million to pass and he said “| hope so.” Then the Board
member asked him well what if it doesn’t and he said I'll come back to you. That’s the real purpose, not
because you need the pension money. You have plenty of money; you have $1 million in surplus. The
question in the end is do we really need to override the spending cap for the pension requirements? The
answer is no. What the Board should really do is examine closely why end of year surpluses in the pension
fund 52150 are not escrowed. | think you can probably expect about $1 million this year. Thank you.
Attorney Andrew Prolman, Prunier & Prolman, P.A.
| represent the Clocktower Place Apartments and | am here tonight to answer any questions that the Board
members may have about the proposed refinancing deal that we have with our lenders and with the city. |
would add one thing to the Mayor's initial comments. That is if this refinancing effort is successful, which we
expect it will be, we will be able to preserve the 55 low income housing units that are now at Clocktower Place
well into the next generation of tenants and that is a very important piece of the puzzle to my client, Ed Bryce;
he builds apartments and believes in housing for all and that’s as much of a driving force as anything with this
effort. If the Board has any questions | am here for the night.
Mr. Robert Sherman, 7C Taggart Drive
| am president of the teacher’s union and | am also an elected member of the Pelham Budget Committee. | am
here to urge you to pass the Mayor’s pension plan for the following reasons. First, there would be no need for
this legislation if the New Hampshire State Legislature had not reneged on its commitment to fund a share of
the pension plan which was at 25% and was originally had been 35%. | understand the dilemma that you face
and particularly what our town’s face. Secondly, the inflation rate on which the spending cap is based is
probably at its lowest level and as you can see, inflation has begun to inch upward. Therefore, now is the time
without raising taxes to approve the Mayor’s plan which may get this community through the next two or three
years under the spending cap. The teacher’s contract is coming to an end in August and the Board of
Education needs additional funding to maintain the services and educational quality of the system. | believe
that the community's reputation is partially based on the quality of its school system which is based on the
teachers who are teaching the students in the classrooms. Those teachers are well educated in their subjects
because they have been educated at our nation’s best universities. They have been attracted to this
community because this community rewards its educators in their pay and benefits. Nashua, when it twice
became the number one place to live in the United States paid its teachers’ salaries that were the best in the
