Budget and Capital Committee
September 10, 2002
2 p.m.
Scott Heyman Conference Room

Present: P. Penniman, R. Booth, M. Robertson, L. McBean, T. Todd
Board Members: B. Blanchard, D. Kiefer, T. Joseph, N. Schuler, K. Herrera
Staff: D. Squires, K. Smithers, S. Whicher, R. Nicholas

Called to Order

Mr. Penniman called the meeting to order at 2:03 p.m.

Changes to the Agenda

There were no changes to the agenda.

Approval of Minutes

There were no minutes presented for approval.

Airport Capital Projects

Mr. Nicholas, Airport Manager said the Airport Airline Agreement runs through the end of December, 2003 and that agreement includes all of the local share of any capital projects the County currently has. Those rates are reflected in the Airport fees and charges. The local share that is usually five percent has already been calculated into next year's budget. Beyond 2003 the Airport does not have a contract with a long-term financial consultant to begin consulting with U.S. Airways; therefore, the County needs to negotiate a contract before the other one runs out. Mr. Nicholas said the Airport will be sitting down to discuss what the County wants to have included in an agreement with the airlines and the consultant will then decide if those expectations are realistic or not.

Mr. Nicholas spoke of the future of U.S. Airlines and said they have now have the opportunity with their filing of Chapter 11 to renegotiate their contracts with the unions and attempt to restructure themselves and get to a point where they can compete with other carriers. If they do not do that there is a good chance they will go out of business. Mr. Nicholas said there are 90,000-100,000 people who want to board an airplane in Tompkins County and it is likely another airline will fill the void if that were to happen. However, he stated there are so few airlines around these days, that it may take time to produce a replacement. He also noted other communities are in similar situations.

Mr. Penniman asked if the consultant the Tompkins Regional Airport will hire will have experience with other communities that have a market like Tompkins County and would they be familiar with current contracts that are being signed. Mr. Nicholas said they would be. He also said financial consultants are very expensive (approximately $50,000). However, in the course of the ten-year agreement he estimated that the consultant has saved the Airport close to $1 million and he does not think Tompkins County would have been able to save that amount without the consultant.

Mr. Nicholas said the Public Works Committee is looking at each project and approving each of them on an individual basis. He said as a project approaches, the County needs to be aware of what is happening with U.S. Airways and the airlines in general and make an appropriate decision at that time. He said over the course of the last twelve years the Airport has received approximately $20 million in federal grants and about half of those grants were discretionary grants. He stressed that Tompkins County has received money because it has maintained a good relationship with the Federal Aviation Administration. He believes if the County were to begin turning down grants to save the local share, that discretionary funding will quickly disappear.

Mr. Joseph asked how U.S. Airway's bankruptcy affects the current contract they have with the Tompkins Regional Airport. Mr. Nicholas said the Airport is holding $140,000 in unpaid invoices up until August 11 when they filed for Chapter 11. He said he does not know how much of that the County will get back; however, the consultant felt there was a good chance the County would receive the entire amount. Mr. Nicholas said any payments that become due now are required to be paid within thirty days or they will be in violation of Chapter 11 rules.

At this time Mr. Nicholas provided the Committee with an overview of the status of Airport Capital Improvement Program projects. A question was raised why the figures in the document distributed with the agenda does not match figures contained in the capital budget request book. Mrs. Smithers said she was not aware of any changes in these figures and said she will follow-up on this with Mr. Nicholas.

Chairís Report

Mr. Penniman spoke of the resolution on the agenda entitled Urging the Governor and Legislature to Delay Scheduled Income Tax cuts for 2002, and said he was contacted by media and provided his opinion on the resolution. He noted that when he stated his position on this resolution to the press he was speaking of his personal opinion and not representing the opinions of other members of the Board.

Mr. Penniman said he would like the Committee to discuss rollover funds at the next meeting and discuss how much will be allocated in the 2003 budget as well as what the status of those funds are and the Boardís options are.

Finance Directorís Report

Mr. Squires distributed a Contingent Fund report showing the balance to date being $532,430. He highlighted particular areas of the budget and noted jail medical expenses are very high at this time due to the amount of medications being prescribed. Medicaid expenses and the Department of Social Services budget continues to go over budget and the Assigned Counsel program is spending at a higher rate than in the past. Mr. Squires stated the Medical Examiner program has expended all of its funds for recoveries for the year.

Mr. Squires said in spite of the above potential budget shortfalls he expects sales tax receipts will come in over budget by approximately $1.4 million. This will largely offset those items stated above. He reported on interest earnings and said the County is currently receiving only two percent on its money; the amount budgeted was 3 ½ percent. The County is also receiving less money than anticipated for delinquent taxes.

Mr. Squires said he has been trying to track the Countyís cash flow. As of this point in the year, the County is close to where it was at this time last year, having closed out August with $14 million. He said this is a good sign and as he will continue to update the Committee on a monthly basis on this. He reported retirement rates came in today. The rate for 2002 is 1.8 percent and 4.1 percent for 2003. This is a major increase for cities across New York State that have a police department. The fringe rate for 2003 is going to cause a $500,00 cost overrun which will have to be subsidized by the retirement reserve.

County Administratorís Report

Mr. Whicher had no report.

Deputy County Administratorís Report

Mrs. Smithers had no report.


MOVED by Ms. Robertson, seconded by Mr. Todd. Mr. Penniman stated this resolution is similar to the New York State Assembly bill that requests an income tax on higher-paid individuals and the revenues would be applied towards education, health and human services, and economic development. He said the New York State Association of Counties has adopted a system for prioritizing their resolutions being presented to the New York State Legislature of which mandate relief is always at the top of the list. He said the goal is to have a lot of the counties say they are willing to have the State tax constituents at a higher rate on the income tax in exchange for a reduction of the property tax. A voice vote on the resolution resulted as follows: Ayes Ė 5, Noes Ė 0. MOTION CARRIED.

WHEREAS, based on results of the New York State Association of Counties survey of 2002 County Budgets, eighty-six percent of counties reported that their financial condition has deteriorated over the past year, and

WHEREAS, counties have indicated that there are several reasons for their fiscal decline including the increased cost of existing State mandates, a weak economy, and the impact of new State mandates, and

WHEREAS, on average, county adopted budgets for 2002 have increased by five percent, with counties reporting that on average, fifty-eight percent of their budgets are mandated by the State and not discretionary to the county, and

WHEREAS, many counties are now projecting additional large increases in spending for 2003, primarily due to State mandates, with the potential for large property tax increases, and

WHEREAS, Tompkins County is expecting a twenty-six percent total increase in the growth of Medicaid costs paid by local taxes during the years 2002 and 2003, driven by several components including the new costs associated with the Family Health Plus Program and spikes in prescription drug and nursing home costs, and

WHEREAS, Tompkins County will be forced to increase spending by $3.1 Million for Medicaid during 2002 and 2003, causing a 14.2 percent increase in property taxes during that period, and

WHEREAS, given the burden of State mandates, counties are being forced to choose between large tax increases and severe reductions in many other basic services that our citizens have come to expect and require in order to maintain their quality of life, now therefore be it

RESOLVED, on recommendation of the Budget and Capital Committee, That the Tompkins County Board of Representatives urges the State of New York to adopt legislation that will increase the payment of taxes by those who can most afford it, by imposing a higher personal income tax rate for incomes above $150,000, with an additional tax rate increase for incomes above $200,000,

RESOLVED, further, That the State use the additional funds to provide property tax relief to counties through increased State reimbursements to counties for mandated programs,

RESOLVED, further, That the Clerk of the Board is directed to supply a copy of this resolution to Honorable Sheldon Silver, Honorable James L. Seward, Honorable Martin Luster, Honorable Randy Kuhl, and the Honorable Joseph Bruno.


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MOVED by Ms. McBean, seconded by Ms. Robertson, and unanimously adopted by voice vote.

WHEREAS, the Fire, Disaster, and EMS Office had an employee, John Miller, retire effective April 6, 2002 at a cost of $19,551, for terminal pay, and
WHEREAS, the Fiscal Policy of Tompkins County allows for terminal pay replacement from the Contingent Fund, now therefore be it
RESOLVED, on recommendation of the Public Safety and the Budget and Capital Committees, That the Director of Finance appropriate a total of $19,551 for terminal pay for John Miller, and further
RESOLVED, further, That the money be distributed to the following accounts:

FROM: A1990.54440 Contingent Fund $19,551
TO: A3410.51200551 Overtime $15,517
A3410.58800 Fringes 4,034

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MOVED by Mr. Booth, seconded by Mr. Todd, and unanimously adopted by voice vote.

WHEREAS, the College holds a beneficial interest in certain real property situated north and in the vicinity of a thoroughfare known as Far View Drive in the Town of Dryden which has been identified as being an ideal location for a parking lot containing approximately two (2) acres which would accommodate about 130 automobiles (the precise metes and bounds and acreage thereof to be fixed by survey) (herein, "the Property"), and
WHEREAS, pursuant to Education Law §6306(4) title to the Property is vested in and held by Tompkins County and Cortland County in trust for the uses and purposes of the College, and
WHEREAS, Tompkins Cortland Community College Foundation, Inc., (herein "the Foundation") owns, leases, and manages dormitories in the vicinity of the Property and proposes to construct an additional dormitory in this area, which presently will provide housing accommodations for students of the College ("the Dormitory"), and
WHEREAS, the Foundation has expressed a desire that a parking lot be constructed in the vicinity of the existing and proposed dormitories in order to provide adequate parking for students residing there ("the Parking Lot" and collectively with the Dormitory, "the Facility"), and
WHEREAS, the College is amenable to leasing the Property to the Foundation so that it may acquire, construct, and equip thereon at its sole cost and expense and thereafter maintain, repair, and otherwise be solely responsible for the Facility suitable for the Foundationís needs as above recited, and
WHEREAS, the Foundation desires to finance the cost of the acquisition, construction, and equipping of the Facility in an amount not to exceed $6,000,000 through the issuance by the Tompkins County Industrial Development Agency ("the Issuer") of its Civic Facility Revenue Bonds (Tompkins Cortland Community College Foundation Project) ("the Bonds"), and
WHEREAS, the Foundation reasonably expects that it will (1) pay or incur certain capital expenditures in connection with the acquisition, construction, and equipping of the Facility prior to the issuance of the Bonds, (2) use funds from sources other than the proceeds of the Bonds which are or will be available on a short-term basis to pay for such capital expenditure, and (3) reimburse itself for the use of such funds with the proceeds of the Bonds, now therefore be it
RESOLVED, on recommendation of the Budget and Capital Committee, That the President of the College be and hereby is authorized:
1) To seek and obtain such consents, approvals and/or authorizations from the Collegeís sponsoring counties, and each of them, which may be necessary and appropriate to allow the College to lease or otherwise transfer the Property to the Foundation for the purposes above mentioned, and
2) To enter into and execute a lease or other agreement with the Foundation pursuant and further to which the Foundation may construct and maintain (i) the Parking Lot, and (ii) the Dormitory to accommodate students residing in the Foundationís dormitories, which lease or other agreement will be satisfactory in form and substance to the Collegeís counsel and shall be for a term not to exceed thirty (30) years with an annual rent of One Dollar ($1.00),
RESOLVED, further, That the President of the College hereby is authorized to execute any and all agreements and/or instruments necessary to effectuate the foregoing,
RESOLVED, further, That this resolution shall constitute the adoption of "official intent" (within the meaning of the United State Treasury Regulations Section 1.150-2(d)) with respect to issuance of the Bonds and the original expenditures which are reasonably expected to be reimbursed from the proceeds of the Bonds.

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Expanded Budget Committee Calendar

Mr. Penniman said the expanded Budget Committee calendar has been distributed. He said there were still some conflicts with meetings scheduled and he is willing to work with Board members to accommodate schedules to the best extent possible, and said the calendar will be redistributed if any changes are made.


The meeting adjourned at 4 p.m.

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