Present:    D. Booth, L. McBean, K. Herrera, T. Todd
Excused:   P. Penniman
Staff:     S. Whicher, D. Squires, K. Smithers
Guests:     R. Carnrike, TCAT
 

 Vice Chair Booth called the meeting to order at 2:05 p.m.

Changes to the Agenda

 There were no changes to the agenda.

Approval of Minutes of February 26, 2002

 It was MOVED by Ms. McBean, seconded by Mr. Todd, and unanimously adopted by voice vote by members present, to approve the minutes of February 26, 2002 as corrected.  MINUTES APPROVED.

Chair’s Report

 Mr. Booth, Vice Chair, had no report.

Finance Director’s Report

 Mr. Squires distributed information on the County’s latest financing, and stated he received the lowest interest rate the County has ever seen on a one-year note of 1.655 percent.  This is the first time the County has ever received a rate below two percent.

 Mr. Squires said at the last meeting there was discussion about the financing operations of TCAT.  After discussion about changing the way the County handles the financing of that operation, a larger dialogue followed about whether TCAT was initially given enough resources to operate.  At this time he distributed a spreadsheet showing TCAT’s cash flow.  Mr. Squires said the County has money budgeted for transit services that is dedicated from the sales tax, and TCAT and the City has requested that the County change the way financing is handled.  He said the problem is because when TCAT was first formed it was not given enough resources to operate on from a cash flow standpoint.  He introduced Rick Carnrike, Comptroller for TCAT.  Mr. Squires said federal and state money comes to Tompkins County and the three TCAT partners – Cornell University, the City of Ithaca, and Tompkins County, have a one-third share in their budget to fund the operations.   Cornell and the City have their own bus operations and have ongoing costs with operating expenses.  The County’s cash contribution is a lump sum of $450,000 for 2002.  In reviewing the spreadsheet that was distributed, members observed that TCAT runs a cash flow deficit throughout the year and in order to resolve that it has been borrowing against State Aid.  Mr. Carnrike said the issue is not whether TCAT is viable, but at certain times throughout the year they do not have an adequate cash flow because they have not yet received STOA (State Transit Operating Assistance) payments.

 Mr. Squires said one proposal is that the County advance its budgeted funds to TCAT so they can pay off what they owe.   He said the County does have the budgetary authority to pay TCAT the state aid; therefore, one solution to the problem could be for the County to advance them state aid funds instead of them borrowing for it, and charge the partners the cost of carrying that money.   If this were to happen the County would not turn over the state aid but would be keeping it since it had already been advanced to TCAT.   Mr. Squires said one problem with cash flow borrowing is that once it happens it generally becomes an annual process.  He said there are resources available to do this because at this time of the year the County has approached its highest cash position due to all of the taxes coming in.

 Mr. Todd said he does not oppose doing this; however, he feels the Board should have all the information up front, including that it may be an annual occurrence.   Mr. Squires said the County will pay for this one way or another and believes it should be done in the most expedient way possible.  He believes the County should try this method of advancing state aid.  He said the County receives some protection because it does directly receive the state aid.  He said the only risk he could see at this point would be if the State were to reduce its support to the STOA program.  He does not think this is likely because transit appears to be the one area of State government support has been increased.

 Ms. McBean said she is not clear where the deficit is going to be made up if TCAT does not receive the $700,000 one-time accelerated STOA payment.  Mr. Squires said if the state aid falls off and the County has dispersed funds, the County would have a direct impact in the year in which it occurs.  There would be a budgetary issue of TCAT financing in the subsequent year which would need to be addressed in the following year’s budget.  Mr. Squires said this problem will continue to weigh heavily on the City if it continues.  Cornell has not been complaining because it has enough resources available to cover this problem.

The Committee agreed to moving forward with this and instructed Mr. Squires to prepare a resolution to come to the full Board.

It was MOVED by Ms. Robertson, seconded by Mr. Todd, and unanimously adopted by voice vote by members present, to instruct the Finance Director to prepare a resolution that this be done for one-year and if there is a deficit in State funding that it is shared by the partners.  The resolution should also state that the Board understands that this might be a one-year thing or arrangements may need to be made for future years.    MOTION CARRIED.

Report from the Deputy County Administrator

 Mrs. Smithers had no report.

Report from the County Administrator

 Mr. Whicher had no report.

2003 Tompkins County Budget

 The Committee spent time reviewing Schedule B – 2003-2007 Capital Program.  The first page of the document shows all capital projects that the Board has committed to and for which money has been borrowed.   The second page show s programs on which the County has yet to make a final determination whether and how to proceed.   A question was posed by Ms. Robertston about Hanshaw Road; she said there was discussion at a recent Public Works Committee about delaying this project.  Mrs. Smithers said the document before them is based on the budget that was adopted by the Board last year.   Ms. Robertson said she would check with the Highway Manager on the status of the Hanshaw Road project.
 At this time the Committee reviewed and discussed three budget scenarios presented by Mrs. Smithers.  Mrs. Smithers stated County departments have fiscal targets equal to $34 million.  This is the starting point for the 2003 Budget.   After taking into consideration mandated items that were adopted in 2002 in the amount of $11,062,434, a Contingent Fund of $830,000, self-insurance reserve and insurance of $300,000, and debt service of $2,401,160, the 2003 base budget totals $48,605,023.    This amount minus items that are not subject to across-the-board reductions (TC3, TCAT, Contingent Fund, Insurance Reserve, Debt Service, Mandates, and Municipal Sales Tax Agreements) equals $29,928,089.

Mrs. Smithers said the 2003 base budget figure of $48,605,023 represents a 10.62 property tax increase, and noted this does not include any contractual pay increases which total approximately $1 million.  The available fund balance will be $1 million.  This has diminished back to a level of where it was around 1995.  She said since that time the fund balance had continued to grow and was used to fund ongoing expenditures and was also used to offset increases in the property tax rate.  She distributed three scenarios she had prepared that addresses that base budget figure.   The Committee reviewed and discussed the scenarios presented.

Mr. Whicher said it is important that this Committee see this information early so that everyone understands what the implications for 2003 really are.  He stated the Board has a lot of work to do and has some very difficult choices to make in the coming months.

There was a desire by Committee members to see and review additional scenarios.  Mrs. Smithers extended an invitation to the Committee to provide her with assumptions they would like to see in a scenario and she will develop it.  The Committee will continue to discuss the 2003 budget at the next meeting.

Adjournment

 The meeting adjourned at 4:05 p.m.