my daughter hannah that's it with the school bus the college i have an m b a from boston college i was also on the financial taskforce where i met a lot of you and i work downtown and in finance at j p morgan and it's said to be part of the committee nominated as chairman we then need a vice chairman and i think we found somebody who has terrific analytical skills and prodigious work ethic and certainly could succeed you in a heartbeat or perhaps as you and that roy vice chair and boy roy of course is leaving the position of secretary so with that vacancy we looked around and i think we found a rising star i would say  working group and we expecting a lot this year you know better and better thank you so you know for those who that may be watching or for those you in the room it is i would say it's somewhat of a tradition that the chair served for two or three years so it's this being my third year it is my expectation this will be my last year as the chair so i look forward to it working with you all i was pointing to another three year term as some other folks were as well so it is my i think that everyone is familiar with the notion that article nineteen of the town bylaws actually establish the work committee and its primary role is to serve as the advisory board the school committee and the school department we develop the budget and recommend a budget to a town meeting and typically in june but we also do is we provide analysis and recommendations to town meeting on on any article that comes before a town meeting that has a financial impact and so those are the those are the core areas that the town that the work committee works on on a regular basis we typically will meet on wednesdays there may be exceptions to that will typically meet here same time same place as we have in the past i will endeavor to start on time and finish on time as i think we have in the past if not early and if you know your body knows there's served here in the past me bias will be to have four agendas and not just have meetings for the sake of having meetings but we'll actually try to use our time as productively as possible i just did have that a draft calendar for the fall and you know there's some question marks in there as to whether we'll meet on certain days versus other days and it depends a little bit on on issues that come before us so at the moment for example there is no scheduled town meeting and i don't believe it that's changed there's a plan for autonomy to be held in the fall so correctable and so given that there always say is that you know from work committee perspective we don't put any spin on the ball you know our our view is that we're an unbiased advisory group we're not a policy making body we provide hopefully as  sort of middle of the road unbiased nonpolitical a political guidance as we can to town meeting and so i think all of us whether we're town many members or not try to really have a kind of a full town hat on as we're operating here as a warren and really letting the numbers and and the analysis kind of speak for itself to the extent that we can any questions or comments about any of that ok great so why don't we then jump in actually to the fourth item on the agenda which is the review of the two thousand and fifteen financial results which includes the revolving funds we've all gotten distributed to material from david and i sent around the as we all know the fifteen budget process actually began in december of two thousand and thirteen with our financial projections so again basically that's almost eighteen months before june thirtieth two thousand and fifteen basically thank you snapshot of what again may not happen as of june thirtieth when you start the process in december of thirteen and a lot of things can change in happen during that period so  and as you we mentioned before basically what the department of revenue does when they take a look at our recap sheet we have to list our actual revenues for fiscal fifteen and then use get compared to our projected revenues for sixteen and they basically compare them and we're obligated to identify if there are any cases where we're projecting a higher amount the sixteen that we did actualise in fifteen so basically they want you to explain if you brought in a dollar in fiscal fifteen in your budgeting a dollar fifty how can that be you walk it why is that the case and what's the rationale they want to know that and basically  a bunch of other accounting entries there with regard to cools and set up some other kind of general ledger accounts and get cooked into the free cash calculation determined by the department of revenue again what we will do is this information is to use that to add to our financial model that was developed last year as part of the financial taskforce and use that as a basis to begin working on the fiscal seventeen budget process ok perhaps the most surprising number to me on the street ok so i guess ok so basically obviously the approved budget fifteen have a property tax total that becomes a commitment which then the bills are sent out no one ever collects hundred percent of their property tax bills there's always a percentage that does not get collected the treasurer and generally belmont has done very well in terms of collecting between ninety seven and ninety nine point nine percent of our property taxes in any given fiscal year but there's always a balance that doesn't get collected which is expected so that's not unusual and frankly it's more problematic if in fact you're not collecting in the not high ninety percent percentile for property taxes that's when the rating agencies and other people take a look and that's an indicator of other things that are going on that basically people are paying their taxes in terms of the economic health of  community the life so basically that's one of the items that basically the property taxes are basically booked as a receivable and basically as you book the receivable when we collect these property taxes in the future basically the receivable go down based upon the collections that are made for fifteen property taxes that are collected and subsequent for fiscal years when we basically levy the sixteen budget will set up a receivable and again within  sixteen ninety some odd percent will be collected into the outstanding receivable will basically get booked and basically that's one of the comparisons that the department of revenue does and terms of of the free cash certification and it's your question fact folks not to pay their taxes the town has a legal remedy which is called next time yeah like i think we have to subpoena collecting just about all of it right because again it's an automatic when you know your real million i'm sorry three million two hundred twenty three thousand dollars from those five categories let's start with the motor vehicle excise the town basically collected three million two hundred and fifty nine thousand in actual excise tax three million dollars so in fiscal sixteen we did our financial plan we basically increased the excise revenue by two hundred seventy thousand dollars as we have talked about before and as you know from your personal experience you excise tax bill is based upon the value of your vehicle and that's on the depreciation scale so basically every year of the value of your vehicle goes down and there's a corresponding reduction in your excise tax bill  clearly in order to maintain your excise revenues at a predictable level basically what what should happen or does happen as hat has happened in belmont is basically people buy new vehicles and basically that offsets the cars so basically as long as basically you're having exide value continue to grow you will see increases in a sex revenue clearly if nobody buys new cards then basically the penalties and interest as the chair just mentioned the town budgeted one hundred ninety five thousand dollars we actually i'm sorry meals tax we budget one hundred ninety five thousand and we collected two hundred seven which is about twelve thousand dollars more than what we kiss a painted for fiscal sixteen in the budget we increased the revenue estimates of two hundred five thousand dollars so basically that's one of the revenues were basically d r will say ok you collected two hundred seven thousand dollars in fiscal fifteen in your budget in two thousand and five thousand dollars for meals tax that makes sense there's a there's a symmetry there that that that they will not have to question if in fact we we  compared to what you budget so again we're twelve thousand dollars over what we asked the mated but we've increased the revenue estimate for sixteen to twenty five thousand dollars which is pretty close to what we actually collected in the past the school year penalties and interest again penalties and interest are reflective of the penalties and interest that one pays their property taxes when they're in a rear or motor vehicle excise taxes when they're in a rears so basically if in fact you dock current with part of the whole dynamic here is to budget amount that you are reasonably confident you're going to collect so you can be guaranteed to collect that revenue year in year out again as i as i think you may have mentioned the treasurer's had another good year going after folks who may have been tardy on their property taxes and basically collected those funds and so basically that's a reflection of robust collections from outstanding property taxes an excess taxes so basically again if in fact we're not as successful in the upcoming fiscal year basically there will be a symmetry of having lower actual collections in fiscal sixteen for us generally the variety of non profits that basically pay in the taxes and collected by and large what that is so basically at the end of the day just as a recap of the town again i think there's been a effort over the last couple years to as as we actually have history and if you look at our actual to basically increase the revenues in the sub sub subsequent years which is what we did for fiscal sixt n next is ambulance receipts so this is the second year basically after the implementation of the advanced life support by the town in the fire department it basically made our total revenue budget of a hundred and four thousand dollars in fact we exceeded our revenue budget by sixty six thousand dollars we had a very strong fourth quarter in terms of our revenue collections for the work in dillon service as you recall one of the things that was factored into some of our weaker revenue collections at the beginning of last fiscal year was at watertown which primarily called belmont is a back up for ls services was using their  contractor vendor more heavily basically wasn't calling upon belmont that was a portion of our revenue that we collected from watertown so we were little bit nervous that our budget amount may be not able to be actualized but it's it turned out  we were able to make our revenue and a little bit more so again that's good news and as i said i think this is the second year of that with the implementation of a last in addition to the basic life support service that the fire department provides we've been able to make our eight hundred thousand dollars number and i think that's good news to give some predictability going forward in terms of the next categories of fees the one i just highlighted at the end is fire fees that were collected by the fire department we budgeted fifty five thousand and in recount for fiscal fifteen we actually collected one hundred twelve thousand which is fifty thousand fifty seven thousand more than we anticipated that difference primarily is for a fire department fee that was collected for play and review for the often surprised there was a forty four thousand dollars per month fee so that's the primary reason why the fire department fees are larger than what we anticipated generally speaking in this category we collect give or take about one hundred forty six thousand dollars so next page  page the one i want to highlight here is the fourth line other recreation programs on the recap we basically budgeted seven hundred thousand dollars for recreation fees collected for all programs clearly the pool did open in august but traditionally there was a big push in june for folks to buy their pool passes for the upcoming summer season and obviously the pool was communicated that it wasn't going to be ready in july so there was in and rightly so a lot of folks sort of held off on buying their seasonal pool passes in june and basically held off until there was a clear picture on who was going to open so we anticipated that basically we would make our revenue we were assured by seventy two thousand dollars overall in the total wreck programs clearly with the pool up and running and successful in terms of perth just patient for the month of august what i suspect will happen is in june of two thousand and sixteen our normal pool past season pass fair wall reoccur again and basically the seven hundred twenty five thousand dollars that we have budgeted for fiscal sixteen will be will be realized so i guess if i can just add so this does not include passes will be a hot item come june so you just given the limited data that we have is there any early indicator in terms of the utilization of the pool relative to expectation we had to close it on labor day because we've reached capacity says license permits building we budgeted low under six hundred dollars and fifteen we actually collected one point seven million which is an overage of a million dollars now let me just say hundred thirty seven thousand dollars was a trip to seven permits and those were primarily the permit for the uplands project generated a permit building fee of four hundred fifty thousand dollars so that was a  fees were about two hundred seventy four thousand dollars again they don't do that every day so i would say that that's a large one time but currents like substation project at sixty thousand dollars per m fees and we know that we've got eight hundred thirty seven thousand dollars in seven think permits if you subtract that from the million six you get to about dollars budgeted for fiscal sixteen we're budgeting eight hundred list but i don't think that came in and fifty wasn't on my top so i think that maybe it's sixteen event ok so i just want to put but again that that's good news because again as you recall we appropriated for fiscal fifteen four point one million dollars in free cash so we get that helps replenish the free cash amount that we appropriate in fiscal fifteen with those kinds of overtures so you get to the second next is  interest on earnings which is one of the last items we budgeted one hundred twenty thousand dollars the treasurer was able to take advantage of some investment opportunities that allowed him to basically collect two hundred sixty four thousand in fiscal fifteen which is an overage of one hundred forty four thousand which again is good news in terms of to replenish  pretty closely if in fact you budget significant more in interest earning to new it realizing the prior fiscal year they want to understand how you can make that assumption so interest rates interest earnings motor vehicle excise building permit fees those are the ones they look at carefully to make sure that you are over by joining revenues that you can support from prior years experience so that ok and then the next page basically has the authority to use if we actually collect of overdue property taxes and again he's done a good job in this fiscal year to do that  and that was three hundred and thirty six thousand and then in addition to that you can defer your property taxes so basically you cannot pay your property taxes but basically you're charging a percent interest rate not to pay your property taxes clearly with homeowners and families to basically make sure they do the analysis to make sure that that's a prudent thing to do or maybe it's proven just to pay off the  property taxes and not incur the eight percent interest charge so again i think he was proactive in doing that now basically generated about five hundred thousand dollars of unbudgeted revenue from sources that are not guaranteed basically you may get your money eventually you know a necessary guarantee to get it in a particular fiscal year depending upon how your collection process goes in addition to that we had the sale of our bonds last spring and again premiums are var hundred ninety four thousand dollars so again that's hundred eighty five thousand of one i call them one time revenues around budgeted revenues most of which was generated by the collection of outstanding property taxes and upon premium some so we can add and just said just a quick process a comment as and just raised her hand for those who don't know that there's sort of i can tell you pretty informal about things but it's very helpful for people we've based upon the assessors analysis at the time and believe the church came here in the spring we use the force seventy five i believe that number will be higher than the four seventy five when we set the fiscal sixteen tax rate i suspect and again i'm at least one hundred thousand dollars i believe is the number that we receive sometime later in the spring after the project was adopted or about that so basically early on the process give us an estimate again if they give us an estimate and we budget using that new growth that's limited basically if it's not achieved them basically you can't raise it in property taxes and reader have to substitute that with on the flip side if the new growth rate comes in higher what that will do is just lead to a lower tax rate right no not really because in essence what's happened is is because we have a higher new growth amount for fiscal fifteen that we didn't use it really goes to excess levy capacity didn't have to raise and then basically that excess got flipped over to the fiscal sixteen budget so basically you have probably taxes they didn't have to raise but you put the brakes so basically when we do the sixteen estimate for estimated property taxes you know the two and a half percent basically was two and a half percent plus what we didn't use in fifteen for the sixteen if you were there same thing will happen generally is if in fact the hundred thousand dollars i just mentioned is actually the number basically that number will not be raised but will be part of the estimate for fiscal seventeen in terms of total property tax when you when you when you did your revenue estimates for fiscal sixteen basically you took your total revenues and then you backed out your fifteen point five million dollars for fixed cost from the total revenue estimate and then that left you a recap basically you did and again we know we don't collect all our property taxes but you do collect them eventually there's a provision in the free cash calculation it takes account so that's not an unusual thing you do have it's it's a same difference of if you budgeted eight hundred for for ambulance or seats and you didn't collect it basically you still use the it option would balance your budget we start when you go out and talk to budget so basically the total levy was used to balance the total adopted budget for fiscal fift said the treasurer there made some good investments can you i flush that out a little bit more i guess i'll say two things is basically as i stated earlier when you do your budget basically you're starting eighteen months in advance you know jude three fifteen you sort of start in your revenue projections based on where you are in the current fiscal year fifteen back in december thirteenth so clearly i don't think you would have expected that he was able to even get because again you're not property tax revenue was up by two million bucks i guess what i'm asking is that if you look at fiscal fourteen just before changes ninety two seven and then there was another million one unbudgeted revenues so those if you're add that together you would get ninety three eight and that's some number that we generally don't pay attention to really it's that the ninety three seventy seven is the general fund revenues from fourteen but the ninety three eight is like a number that i don't have for example in an old spread sheets so how do we typically think about  things that we should not plan on because they're not guaranteed but they do help us replenish our free cash when we calculate our free cash position with your war but again i think you sort of should plan on that because if in fact the roughly what we would anticipate being the contribution to free cash as of the seven one like it's just is that the kind of what we submitted that we haven't had it where it were in the process of doing our care statements it will be cemented your for review large we said when we did the belmont side to the dr for free cash we should not have assumed that was going to be replenished that was a one time allocation for a one time project but clearly based upon this poem or a snapshot it appears that we were able to replenish a good chunk of the million so there reason why i'm asking the question is that you know there are other things that are underway with all road square parking lot or things like that are any of those things actually going to impact the seven one number or that is that is this pretty much that is that three point seven six number pretty much what's going to be in the set in the seven one number two what's going to be the seven one number with a nice minor adjustment for the property tax records that that was what i was again the same kind of theme that we've gone through the last couple years clearly we budget for our full positions and clearly during the fiscal year there may be people who are leaving employee town to belmont so we're able to generate some savings and what we budgeted for salaries knowing that's basically what it would have spent the entire budget amount of people did leave but people do leave and it does take some time to hire folks so there is some salary say means in addition to that as you recall last year the war committee did not use its full four hundred thousand dollars allocation for the war commune reserve basically we used to eighty five to help offset the shortfall in the school budget and basically we left one hundred fifteen thousand in the reserve in order to deal with any unexpected expenditures that may or current in the last quarter of the fiscal year so that war committee had a reserve to help deal with those issues if they materialize obviously they didn't materialize so that left you one hundred a fairly good chunk of your reserve on the table which again gets replenished into free cash obvious highlight a couple things  assessor's again there was a salary savings about twenty two thousand dollars that there was some turnover in concessions that basically generates in the salary savings basically there was a sixteen thousand accounts force for different categories the police and fire again had vacancies in their department during the course of the fiscal year in business if we generated four hundred thousand dollars salary savings in the police department and seventy five thousand the fire but again we budget for our total positions in this year we started the fiscal year with the full complement of our police department we have a vacancy already maybe two so again but that was a good effort because typically we're trying to catch up with the academy and basically getting cadets graduated so they could hit the streets but that takes six months to get them on the street director was hired later in the fiscal year and i think the other counts basically came into line so basically you are right in terms of your all non expenditure savings it's a million three that will get reverted back to free cash through accounts so basically the best example is the senior center when they hire folks to run classes or they run trips or they have a fitness center they basically charge fees for the participants which then are used to pay the instructors or to pay the cost to the buses or to pay for any costs related to the needs of the fitness room so basically they are pastors basically the fees are set so they are basically we could offset the expenses so what you're looking for is to make sure that generally speaking the revenues you collect are sufficient to meet the senators and then in some cases revenues that are higher than the actual expenditures which gets put back into fund balance and so every year the town meeting through this committee  so there's no surprises here and again last year belmont against racism served as a fiscal agent for the martin luther king breakfast so i would commission a human rights commission didn't have to use  next time we meet the school the news should soon should have the q one numbers so we don't have those obviously finalized yet but it's in the building number of special education students is the same as last year but it's a little bit higher so this is going to be something that make sure that we would have sufficient funds in these revolving accounts so that's five years old you know there's a lot of there's been a lot of moment changes since then i think it's certainly going to be examining as we go forward determines how they're spent but as long as you know they're not on the school side then that's where the selectmen gets above them yeah i'm just saying balancing the warmer and again they're demonstrating my endurance here but in terms of the word being put on the ward for town meeting and there was some spending make you know when the classrooms had to be put into into use for example at the tannery when the computer lab became a classroom one like yours there were some extent yours came from that ok so it's something that we want to  pattern of a somewhat conservative forecast on the revenue and revenues coming in and excess of expectation expenses at least on the municipal municipal side generally coming in below expectation because primarily a vacancies and then the numbers coming in pretty close to as budgeted for the school side because the school has the school department and school committee have the ability to move money have funds or resources within the entire budget that is a pretty common pattern that we have i'll just mention that if you look back at the the ten year compound annual growth rate for revenue from fiscal four to fiscal fourteen that was three point four percent we had forecast two point seven percent increase in general fund revenues for two thousand and fifteen we actually saw four point four percent increase in revenues in two thousand and sixteen so actually relatively robust revenue picture and in theory more than replenishment of the free cash that we used in in two thousand time as you need it was but i might be one or two in the short but i gather some power point slides that's generally consistent with the report of the draft report from michelson yesterday it's specific to pension funding michel and i've talked about using this meeting as a starter discussion with you in things in more detail next week and hopefully being a position to take a vote on the report on october fourteenth to submit the record and so i'm just to kind of dive in and wade in and see where the deep spots here are before i do that i wanted to first really applaud the town meeting and in particular jim williams for really casting a light on long term planning i don't think all of us will agree on all the different ideas that are being floated around jim gamble so thank you very much for doing that that the first page is just just reciting the amendment that we passed last year so i think that's really just a reference point again it's also in the written document but i thought would be easier to kind of flip through the information this way  page three i just made a point of really highlighting what's in scope for this particular pension report the first bullet point it is kind of the purpose of the analysis which is over the next hit ten years or so we are projecting have a pretty significant budget impact from rising pension contributions as part of the budget that's the impetus for the whole study and then really the second third and fourth bullet points or sense of the options that were put into the request of town meeting but one just stick with the status quo that's the current funding schedule  a funny schedule by the way is a payment plan when a state or city actuary tells you that your pension system doesn't have enough assets to pay for benefits over a number of decades they put you on a payment plan over ten or twenty or thirty years to put extra money in and really get caught up with just about every town in the state is on the one of these funding schedules so sticking with the status quo is one option there's a few different ways that we might modify the funding schedule to maintain something that rating agencies and actuaries would still view as fiscally disciplined but might have a little bit less of an impact on the budget over the next ten years and then lastly pension obligation bonds which we'll talk about in a moment the next page of page four these are the things that are out of scope but of course part of the broader discussion  really narrowly focused on pensions and the work of the opeth commission we have some thoughts about how to talk big picture but that along with some of these other issues like the actual pension benefits in the investment portfolio and total cost of employment are important parts of  bigger discussion but are not part of the narrow charge they were being asked to complete for this report page five there's some information here just that it is a basic definitions on what a pension funding schedule is and why it's important the first bullet points you typically you talk about getting to full funding that means the actuary says you have one hundred percent of the assets to pay for the liabilities that they calculate the target date will talk a lot about that's the data which you expect to get there twenty twenty seven is belmont's target four percent funded ratio that's in the bottom third among the cities and towns in massachusetts good news as we used to say that's in the bottom core tiles used to say that's in the bottom twenty percent we're actually making some progress and we can talk more about that if you like and something else over eighty percent of the you know seven eight million dollars that we take out of the budget and put in the pension plan every year are going towards what's called amortization payments that's the catch up from not putting money aside back in that there's a much smaller is basically the regulatory oversight organization and they tabulate all this information if you look around and what it shows is if you look around say twenty twenty seven or twenty eight belmont is one of about seven towns that are that are scheduled to get the full funding at about that date but more than half of all the other systems are somewhere between say twenty thirty and twenty thirty five and some are have kick the can down the road even a little bit further so again i think this puts in a context that belmont i think from this perspective is really pursuing a very fiscally disk disciplined and there's a sprinkling of other information i think we'll talk more about the other reference point so the society of actuaries recently came out the report recommending a good page seven but this shows the blue bars are the projected pension contributions that we talked about you don't see the numbers there but it's growing it pretty much exactly seven percent a year that means it's going to double in a decade the rule so those keeping score comes in very very handy for our pension system and then what you also see so the blue bars or other pension costs growing at seven percent a year the red line is just keeping track of how close you're getting to that magic hundred percent  funded ratio that the actuaries calculate and would you also notice is there's this precipitous drop on the right hand side of the page as you get to full funding and what that is showing based on these are very standard actuarial projections is that if everything were to play out exactly as the actuaries assumptions planned the system would be fully funded by twenty twenty seven and though this be this big drop off because you're no longer making those amortization payments the eighty percent of the other costs that i was talking about befor think this is a useful framework it's a good way to think about the plan i think it's a way to consider that at some point in the future we might have more resources for example the fund open liabilities but the fact matters it's one hundred percent certain this is not exactly what's going to happen these are just actuarial projections it is certain that investment returns will be higher and lower than expected it may be the case as you get closer to full funding you'll make different decisions about how much risk you take on your investment portfolio but i think i think it's a helpful think there's a lot of numbers here and i'll just walk through left or right and essentially what it's trying to do is say the potential costs as you see the left hand side the page are going at seven percent and if for example and this is just an a list illustrate example  our resources were going at three and a half the number could be lower could be higher we can calibrate the task force report we can basically calculate how much that excess how much those excess amortization payments as they compound at seven percent year over year could be squeezing out of the resources in the budget it's a relatively small number if you look at year one of the analysis just a quarter million dollars we got three million dollars in four years and i think ten years out or so it gets to be about three percent of the operating budget and will include some information to show what the performer is relative to the operating budget so essentially just a met a measure of what the impact of those excess amortization payments can be thought of in terms if it's on the budget so that's a that's a great point yeah and starting off with the idea that you know you better different or acclimated to this seven or eight million dollar number today that's meant that as based on the budget so it's really what the difference in the growth that's we're talking about  you know possible other options the first kind of modifications to the pension funding schedule so that the language of the memo was really specific about some of the things that we should look at the retirement board was gracious enough to have the town actuary from sieg l and she's just terrific run some different examples a couple of them are here and what we see is that if we took that your or your growth in contributions down a little bit to say five full funding target date doesn't move out too terribly far just goes to twenty twenty eight and at four percent it only goes out to twenty twenty nine there are some folks here who want some more information to release the details behind it and i mean you are going on that you have a lot of confidence in those i do because the conservatives are kind of recreated them but it's just when you're right i've talked about this as well i think i think the thing to keep in mind is that the investment returns and it's a seven point seven five percent return something that's healthy number  make up just as much of the increase in the assets over time as as the town's contributions and the employees are also kicking in two or three billion dollars a year as well so changing the growth rate has some impact and it definitely pounds over time but anything else that's right yeah right so there's a lot of people who would agree with you on this but i do we have data in terms of our investment returns over the last certain times of year and the retirement know thank you but but but the impacts i think there are that you know the good news is then you then have additional resources available to the budget but you're also reducing your cushion the flexibility to it adjust your pension contributions and make sure that you're keeping the system healthy in situations where investment turns don't play out i think that as well as you expect in the long term and that gets the last bullet point there in the role of sensitivity and  analysis if folks at the chance to glance at the very early draft of it we set up a placeholder in there now i think there's actually a lot of work has been done behind it but i've been getting some good feedback a few folks and thank you ron i don't know if you want to chime in and all but i think long story short i think we what we would probably do is say you know based on standards there's just little models what would be the rate of return be at in a couple of downside scenarios ten percent if you think about it just in terms of the distribution of returns right this is all the expected return so let's look at something down at the ten percentile or what it would be of the twenty five percent and there's mostly science and a little bit of art to how you run traps to look at those impacts and i think part of what we see is when you go down a five percent increases or you go down to four percent increases then in those downside scenarios that's where the schedule gets pushed out a little bit right or the amount you would need to stay keep the pension that from growing grows pretty significantly and i think the four or five percent number i put there were are there for a reason because i think there were some other options that were asked to run that were i think less disciplined pushing the whole thing out to twenty forty and my my view is that it  or not i think i mean you can analyze it any number of different ways but just in terms of long term fiscal policy planning i think the starting point is always do you have something that meets the definition of sustainability which broadly speaking says that your costs grow roughly in line with your revenue  i think if you had you know sort of a windfall tax year and this is more something that what might happen at the state level for example where when the economy is overheated the stock market is recovering the state brings in all sorts of capital gains tax revenue and that might be one of those you know cyclical situations where you don't want to put more and although you have to think about where the frothing stock market exactly how you invest that money but for i think for the town i don't know that we have sort of that level of  very that level of sort of nuance point of view on how to approach it so long story short i think i'm thinking about this in terms of what your long term revenue growth is a good starting point but i think you also raise another question which is if and when we and i didn't know if had a chance to look at like what other aaa towns that are they are some of them further out than we are in terms of their amortization and that's something they take and we talked about having or is it relevant so we compare ourselves to the others other than the fact of course it is a limited number of aaa rated communities so basically that's your peer group and basically that gives you some of how the rating agencies look at aaa rated communities in terms of the things they're doing to basically deserve that rating so this is one of those like areas that they look at it's i mean in general basically how you're managing your debt what's the economic health of the community the stability of management it's your balance sheet so all those things roll into an overall rating but but clearly this is one of the subset have trust have a policy to contribute to that and really they says basically have adopted legislation that requires medicare eligible employees to go to medicare first before they come to the town's retiree policy so we've done all the things that we've been able to do that we have statutory authority to do so i think i think as jim said they are married in terms of liabilities on the books and what you're trying to do to address them that's when things are gets looked  t i will add we are we are one of excuse me as we are one of fourteen communities out of three hundred fifty one in the commonwealth that are aaa rated so it's small but i guess my question  impact on the budget and you know what scenarios might look like it may be useful for for everybody to be kind of grounded on who actually owns the decision rights about what gets done here so maybe you can make speak on this in a tone as well i mean general my clarify the retirement board decides when between now and two thousand and forty we are going to fully fund the unfunded pension liability correct yes and therefore decide what assumptions are made about  investment performance and the increases in in funding schedule that kind of thing when do you make that when's the next time you actually make that determination in the schedule of your first two thousand and sixteen ok as of the original goal state wide was to do it all by twenty twenty seven which is the target date here it's just that as a result of fiscal crisis everybody else or many other people decided to stretch it out and we stayed with the original date bonds and i think this is something that's it engendered a lot of discussion so i think just to keep things really high level the opportunity in the rather behind issuing a pension obligation bond which is pretty much what it sounds like the town issues money and it's a fifty million dollars and puts that money into the pension fund is that if the investment return plays out the way the actuaries project currently seven percent and you can borrow at four and three quarter percent  you can save money based essentially on the difference it's a little bit more complicated but that but that's fundamentally what's going on the risk of course is that investment returns are inherent and heralding uncertain and so those savings may not materialize and there's some potential for a loss  i think you know it in my day job when we look at these things you typically walk through three steps the first is is the city or town looking at a pension obligation bond really out of desperation as a way to make that years  contributions into the pension system with no other form of dollars to speak of that's certainly not the case of what's going on in bell and we've seen that i think to some extent some of the challenges that weren't wester or some of the cities in pennsylvania came out of very deep budget challenges with cities in towns with low credit ratings and high borrowing costs so they very low margins for error happening at kind of the exactly the wrong time that's not what's happening here and then i think the you know the second place you go is doing again some of the sensitivity in scenario analysis and i think we now have information i spoke to tom earlier about getting some more help in the actual data to complete the data we have and you know again what that will show is that in you know depending on the time horizon you look downside and somebody once said that risk is kind of like religion everybody has a different point of view on it and it's kind of hard to move them from where they sit and i think in the end of day in my experience there is always some number of regional people people that will just point out that there's no free lunch with the stuff and if you're going to borrow money and put it in the stock market there is risk and what could happen if say we had a downturn in the five years leading up to a time when we want to potentially borrow money for a new high school for example and it's just really difficult to  just put a box around those uncertain scenarios but that being said i think that's the that the kind of analysis that will run and i think that's something with it will include the next go around have some further conversation about it and i don't know if any i think decade there's probably three or four more times that number that in fact went to the legislature for permission to do so it's pretty few and far between the state of kansas is the last state of the i think the state of connecticut and the cities in pennsylvania have the best known stories around it so it's a relatively small number and i'd be happy to send out kind of the press remember that sometimes it's a small volume and i mean that they're generally issued by the most desperate communities and i would say generally but i think oftentimes those are the circumstances where it is in part is it a necessary part of a long term plan which i think it candidly in this question about might that's what it's been part of but i think you know going back a couple decades now in philadelphia for example they just didn't have a way to close the budget gap and so they actually said you have to put at least x dollars this year they didn't have it so they borrowed to do it in that case the rates were i think north of six percent the timing wasn't so great you know the small margin for error so i think it's more common that it happens in situations  understanding that it is you look at you know experts out there and their perspectives on pension bonds and and the risk associated with them there isn't kind of a there isn't a groundswell of yes and i would say for that as an approach is that is that a fair statement i think that's a reasonably fair statement i think the last time that one of the very well that experts in the field said something  very positive about it was actually just coming out the great recession there was a guy named gerard miller who was actually very well regarded and now manages money california and he just pointed out that rates were very low but at that same time the stock market was you know a third of what it is right now return of seven and three quarters where does that come from that return expectation informed by historical results and then the board has a consultant and he she was pretty well known and they do a bottom up analysis looking it essentially economic growth inflation and what the economic weakness premium is with the simple building blocks and how what's the regularity of does that number get adjusted to yours when you on that same schedule that you were talking about or how does how does that number change  group as a whole around you know sounds like the right direction in terms of the format of the structure of what we're doing or there are kind of important areas that the group feels that you know we maybe you know different directions we want to take or you know if we were   town meeting in terms of you know you know how how is actually the expenditure growth what's that look like how will that impact the operating budget in a way basis what are some of the strategies that we potentially could deploy as a town quickly to retire and we're being the ones do it around mitigating the impact of the impact on the budget so we're being asked especially give you know information to townie timing it to a meaningful jury doesn't actually have the decision rights around this you know can in fact you know urge or suggest certain things to the retirement board but that's ultimately retirement board's decision so the way i see it is worse initially and forming and to some degree made there only points in time that you can make that decision and then the other thing that i think might be helpful to put in here is all of the other factors that can affect this and you know we've talked a lot about the investment in actually wh determination to drive it end it can change significantly in any one year because of that i think this somehow just to put that in your not that we want to address it but when you talk about things we're not going to address or you know at least say here's what the drivers are  aside from the seven percent ok by the way we have no control over  that makes sense but you know i'm not sure answering a question i'm not a fan of this explanatory note i don't have the form of the article before me but what it's really asking us to do is to discuss how rapidly growing expenditures might impact the operating budget and assess different strategies you identify the problem and the costs and what it needs but it really doesn't get into what does this mean we have to give up in the regular operating budget that's what they seem to be wanting the answer to one of the strategies was s'posed to come up with to do that that's what they're asking us to do i don't think we necessarily should but that's what the town meeting is asking us to do i actually put it differently i think that town meeting is asking us to have some assessment about how to manage that platform in the budget which is represented by the retirement contribution so you know we said well we're used to the seven million dollars yes we are but then what happens when it turns into twenty five million or whatever as you know it you'll have contributions six and then and it keeps growing at larger than our budget is growing how does that platform change and is there a way to manage that somehow i mean that's you know i don't think it's possible to answer the question what we have to give up in the operating budget yet years from now  be delivered to tell me about your fifteenth two thousand fifteenth so it's actually pretty simple right the way i approach this is how can we be helpful to town meeting right because there's a pretty there's a pretty that's a that's a pretty broad mandate and i guess the second that i would say is and i would really show the ask this question to tom which is how can we be helpful to you i mean we're you know to me i don't think about the you know this group's time and typically cranks time as an expert on this as being you  know we're just trying to do you know busy work you know if we don't want to just amuse you you know to the extent that we can actually be genuinely helpful to you do you have any feedback for us about how we can be helpful to you in this process  explanatory notice pretty specific and it basically says to assess different options and we've basically laid those out here which is stick with the status quo look at different ratifications to the funding schedule or pursue the pension obligation bonds strategy the right approach to it which is what we're so and so i just wanted i mean i think i think if we're still heading down the path of maybe making a recommendation among those three choices essentially i just wanna make sure that people are in agreement with that as opposed to just submitting some information that's understand that there are you saying should we make a recommendation on this fred i think that was my expectation based on the explanation explanatory noting sort of some conversations we had that we were going to say these are the three things as they lay out basically three options and we have to offer an opinion so adam and then jim yeah i mean as one of the sponsors of the article that was my greg's approach was exactly sort of what i was thinking would happen lay out the option options make recommendations not a decision ultimately what to do it's not time meetings decision what to do town meeting once information so if they want to go and address headcount or whatever they want to do to address it with that is within their control they can do that of pressure over time for we understand board position it can only help them to have data from us there are small board with a lot of resources we have a lot more resources we can help them out make recommendation will be adopted or it won't but it's a worthy exercise of going through and hashing out each of the options which i they're not they're not equal in terms of what is achievable i mean that so first of all there are there are i mean there are three broad strategies one strategy is to stay the course second strategy is to modify the schedule in some capacity and the third there broad strategy is some sort of pension obligation but on approach those strategies are not actually specific proposals so a specific proposal for modifying the schedule which would be for example go with four percent growth or five percent growth instead of seven percent growth which results in a unit and a funding by two thousand and twenty eight or twenty two a not but that's a more specific proposal a pension in bond proposal which actually says we're in a bar at this exact amount of money and when do this if that amount of things that that's a specific proposal so i don't think it's actually within our capacity to actually make a specific recommendation within those strategies i think we can talk about those three strategies in the that some of the pros and cons of them and and help i think advisor you know what the right direction is from our perspective but i don't think we're actually going to be writing a recommendation and he gets more i think in your your domain tahn of exactly what the right approach is i mean do you see that differently but what your perspective i think that's about right and i think you can approach in a way to say we have these stories strategies we may have a preference for this one and we think that there are time porches look at options such as rights kind of a general direction based on feedback and analysis players standing as we were talking about these as if they're mutually which they're right other than i mean staying the course i think they're largely mutually exclusive how do you see that different why would a pension obligation bond preclude us from changing actuarial scenario well i mean you know i think i think you did issue the body that was sort of overwhelmed the existing math that goes into the funding schedule that would dictate how that i recognize that we're going along and i apologize for that if i was a town meeting member and knowing not much at all about this but just get thirty thousand people over there and i'm looking at ya pretty budget being impacted with this kind of expenses coming in the impacting the aaa rating which i think there are a number of us that have said that that's something that we want to maintain as a priority and it the second thing is even if you knew that you could actually extended it quite far towards twenty forty you might actually think that's not a good idea anyway because you might actually have a much higher risk profile if you had a downturn and then you would not actually be able to funded by the the mandated twenty forty so i think there you have it at a minimum you have least those two factors which is maintaining the aaa and making sure you off and then we're going to use those same lines in our budget to start chipping away at a rope that's been the story to the aaa to the rating agencies to some degree and so i think it's not just as simple and we  board inquire with perak about what their latitude is for request were made to them to have an extended schedule how their view would be because at the end of the day paris approves the schedule so it really before you get to the mood is peace what is the authority and in view of para controllers of the schedule that is being extended to something significantly longer than we currently have what would they say because at the end of day if they don't approve it you have to come back with another proposal right now you want to cover that forty and we are the answer to that so that any and everything has been analyzed for things that they would so siegel looked at i think for in the series we sent were twenty thirty he said those were fine i know that up until twenty thirty five he might say something similar beyond that he would say you have a problem so some of this is you know it's a little bit i'm sorry roy did you hear him  frank and so meet again next week and we're view and a round of conversation and we'll spend a quality chunk of time on that at that time i remember a town meeting saying i hate out official deadlines this is nonbinding i would rather do a good job late we met on monday night and we did approve a final design for the belmont center delta green area in front of the month savings bank what we didn't do was we produced what we're calling an enhanced dramatically improve the plan i might add and he did that all for bono donation to the town so i thank andy for that the final plan adds about an additional seven hundred fifty to eight hundred thousand square example during the summer months people can use it over the weekend you know for example we haven't specifically discussed operational restrictions but that's going to be a if you church topic  also the light board met this morning and we did approve a solar you know net metering solar policy and tariff we had appointed at the beginning of the summer metering advisory working group and that was chaired by our very own roy epstein they met sixteen seventeen times over the summer in the span of two months and you know produced recommendations  and produced reports they came up with a recommendation that one encourages use of solar facilities at the same time you know under their formula belmont light doesn't lose anything either so it encourages solar but not at the expense sort of say of belmont light remarkable job thank you roy for all your har work on that the tariff was officially filed today so we wanted to file it before the first of the month so that it would take effect within thirty days and what it does is it adds certainty certainty to the industry ok so solar installers know exactly what to expect we are also and this was part of the committee's the working groups recommendation we are also engaging the energy committee to do a solar challenge you know belmont solar challenge a campaign where they would help to sign up households in town that do that then that gives us additional bargaining power with installers to really reduce the cost of installing the system so that is something that the energy committee will be working on we met with them this morning as well finally you may have heard that that was all the good news the other day was as you may have heard the n b a has has approached to the town they were on our board of selectmen meeting on monday basically  they had done some improvements to the waverly square train station that triggered compliance with the handicap accessibility law so in order to make that handicapped accessible the waverley station they are estimating a cost of up to thirty thousand to make it fully thirty million where most of my number so thirty million to make it fully compliant with variances in the neighbors that they would have to get they might be able to reduce the cost to fifteen million a discussion was also raised about belmont center because belmont center even though no improvements have been made that trigger the handicap accessibility law the concern is it might be triggered in the future so that's something they'll have to address in the future they are suggesting a solution whereby belmont center station would close  maybe they would put a new station in the middle along south pleasant street not very well received by those residents that attended our meeting on monday and you know what i've heard is is the preference among most people and i think so far the board of selectmen is you know spend the money make way for the handicapped accessible waverley was largely developed around public transportation and there's a lot of potential for future development centered around public transportation in waverly so we would prefer that waverly be improved belmont center is not an issue now it can continue operating as it is you know the other concern is that they started taking privately owned land on self pleasant street it cuts off our tax rolls it's no longer tax because it's owned by  my point is many issues many issues and that's going to be the next challenge facing a month there on a pretty tight time frame they would like to have a decision by january we are planning or they are planning to have a in town within the next thirty days so i will update you on that and i hope you're all able to attend and participate thank you thank you any questions anything that  on the pension contribution so we're hoping that this october fifteenth first start process and the start of a discussion of the budget process for this year and