FINANCIAL PLANNING COMMITTEE

THURSDAY APRIL 20, 2005

7:00 PM


MINUTES OF APRIL 20, 2006: Mr. Vance moved to approve the minutes of April 20, 2006.  The motion was seconded by Mr. Fidler and passed unanimously (6-0).  


The regular meeting of the Newtown Township Financial Planning Committee met on Thursday, April 20, 2006 in the meeting room of the Township Municipal Building.

Members present were Jerry Schenkman, Elaine Gibbs, Allen Fidler, Phil Vance, John Stranford and Jennifer Dix. Excused were Philip Newmuis, Robert Dieterle and Township Manager Bob Pellegrino.

Also present were Township resident and retired PECO worker Bob Conway and the Township Streetlight Consultant Ron Smith.

CALL TO ORDER:

Mr. Schenkman called the meeting to order at 7:10 P.M.

MINUTES OF MARCH 16, 2006:

Mr. Vance moved to approve the minutes of March 16, 2006. The motion was seconded by Ms. Dix and passed unanimously with one member abstaining.

NEW BUSINESS

Ron Smith – Suburban Lighting Consultants – Street Light Expense

Ms. Gibbs introduced Mr. Smith to the Committee members.

Mr. Smith gave the Committee members a brief history of his employment background and advised that he was formally employed by PECO.

Ms. Gibbs updated the Committee members as to why Mr. Smith was attending tonight’s meeting. She discussed the Township Consortium with regards to the PECO resolution that expires in 2008 and what PECO is currently charging the Township. She also discussed the Township’s future with regards to PECO charges.

Mr. Allen questioned the Pennsylvania Utility Commission’s (PUC) involvement with regards to what PECO is charging. Mr. Smith advised the Committee members on the different types of PECO rates.

Ms. Gibbs advised the Committee members that in 1999, PECO was charging the Township a rate of $.0317 per kilowatt hour. She also discussed the yearly increases and advised that this year the Township’s rate is $.0444 per kilowatt hour and next year’s rate will be $.0474 per kilowatt hour.

The Committee members discussed the resolution with PECO that ends in 2008.

Mr. Smith advised the Committee members on PECO’s rate structures. (Example: a 100 watt light has an operational cost of $20.00 per year and an $85.00 yearly tapping/location fee).

Mr. Smith advised the Committee members on what he does for the Township.

The Committee members discussed PECO overcharging and the 1976 energy crunches.

Mr. Smith advised on PECO’s breakdown for the cost of lighting – amortization 75% - maintenance 15% - energy 10%.

Mr. Smith advised the Committee members that the Township would be paying more for their streetlight cost if they had not bought the streetlights from PECO.

Mr. Smith advised the Committee members on the number of streetlights still owned by PECO, their drop in revenue and their need to make up for the loss. He suggested that PECO may increase their charge for energy cost.

Mr. Smith recommended that the Township contact the PUC and question what is the rate of return per minute on rate SLE and how much is PECO getting.

Mr. Smith advised that PECO charges a rate of $7.11 per connection point (tapping/location fee) and approximately $.05 per kilowatt hour. He also advised that PECO is receiving a Recovery of Stranded Cost due to the sale of Limerick. He believes that PECO can receive a rate of 13% return for capital expenses.

Mr. Smith advised the Committee members on a breakdown of the dollar amounts for the different types of PECO charges.

Mr. Vance questioned the development cost. Mr. Smith advised that the developer pays the entire installation cost and then deed the streetlights to the Township.

Mr. Smith advised that his goal for the Township is to reduce the amount of connection points without using laterals.

Mr. Smith advised the Committee members on damage to the PECO lines by Verizon, due to the fact that PECO did not mark out their lines.

Mr. Smith advised the Committee members that Sycamore Street only has one connection point (tapping/location fee).

Mr. Smith advised the Committee members that the Township’s streetlights have all been grounded.

The Committee members discussed possible options for negotiating a new agreement in 2008.

Mr. Stranford questioned the Township’s potential savings with regards to energy cost. Mr. Smith advised on the possible savings.

Mr. Smith advised the Committee members on his association with the Montgomery County Consortium.

Mr. Conway commented with regards to the $7.11 connection point charge (tapping/location fee) that PECO is billing for per month per year.

Mr. Smith advised on Verizon nicking PECO’s lines and possible maintenance problems in the future.

The Committee members discussed the PECO tariff.

The Committee members discussed contacting the PSATS for possible help.

Mr. Conway commented with regards to the $5.18 customer charge on his electric bill.

Mr. Conway commented with regards to the Township possibly recovering the cost of the tapping/location fees from PECO.

The Committee members discussed PECO’s rates for the traffic light signals.

Mr. Schenkman commented with regards to needing to know how much the Township and residents are being overcharged by PECO. Mr. Smith advised that PECO is charging 2.7% over the national average.

Mr. Schenkman commented with regards to needing the overcharging information on paper. Mr. Smith advised that he would provide the Township with any information that he could. He also advised the Committee members with regards to PECO’s Cost to Serve and suggested having the Township Solicitor contact the PUC.

The Committee members discussed strategies.

Mr. Stranford commented with regards to the issues, first what the general public is being charged and the Township’s charges.

Mr. Smith advised the Committee members that it is his belief that when it comes to negotiating with PECO the Township can not win. He also advised that he would contact someone who may be able to help the Township.

The Committee members agreed to discuss the matter further at the next meeting.

The Committee members thanked Mr. Smith for his time.

The Committee members discussed PECO’s overcharging.

The Committee members discussed what the Township is paying for traffic light signals.

The Committee members discussed the Township’s cost for streetlights. Ms. Gibbs advised that the cost for streetlights is paid out of the Township’s General Operating Fund.

Mr. Fidler commented with regards to notifying the residents.

OLD BUSINESS

Reorganization of the Committee

Mr. Schenkman updated the Committee members with regards to discussion at the last Board of Supervisors Work Session regarding the Financial Planning Committee.

The Committee members discussed the reorganization of the Committee and having the Committee give a monthly report to the Board of Supervisors.

Mr. Fidler commented with regards to the member’s feelings regarding the primary function of the Committee and why the Board of Supervisor Treasurer has been the Committee’s Chairperson.

The Committee members were in agreement to reorganize the Committee.

The Committee members discussed the job descriptions for the appointed positions on the Committee.

Mr. Fidler suggested having the Committee Chairperson meet monthly or bimonthly with the Treasurer to discuss the on goings in the Township.

Mr. Schenkman suggested that the job description consist of setting the agenda, facilitating the Committee meetings and making reports to the Board of Supervisors.

Mr. Stranford advised that he liked Mr. Fidler recommendation that the Committee Chairperson meet with the Treasurer.

The Committee members discussed requiring that the Committee’s Chairperson, Vice Chairperson, the Township’s Finance Director and Treasurer meet no less than four (4) times per year to discuss Township business.

The Committee members discussed nominating Mr. Newmuis for Chairman and who to nominate for Vice-Chairperson.

Mr. Schenkman advised that he would contact Mr. Newmuis to discuss his interest in being nominated for Chairman.

The Committee members discussed past reports the Committee has presented to the Board of Supervisors.

Ms. Gibbs suggested nominating one of the newer members as Vice Chairperson. Both new members agreed they did not feel comfortable as Vice Chairperson.

The Committee members agreed to discuss the matter further at next month’s meeting.

Board of Supervisors directives related to capital needs

Mr. Schenkman advised the Committee members with regards to the Board of Supervisors directives related to capital needs. He commented with regards to discussions at the last Board of Supervisors Work Session.

Mr. Schenkman discussed the Municipal Complex expansion and advised on the department tours he has taken. He commented with regards to the conditions of each department.

The Committee members discussed scenarios to be presented to the Board of Supervisors regarding the Municipal Complex expansion.

The Committee members discussed purchasing the land from the Archdiocese.

The Committee members discussed strategies for presenting the Municipal Complex expansion to the public.

The Committee members discussed alternative locations to build the Municipal Complex.

The Committee members discussed way to inform the public of the current conditions of the Municipal Complex. Members suggested developing a videotape or offering public tours. The members took a brief tour of the lower floor of the Municipal building.

The Committee members discussed contacting the professional media to advise on the current working conditions.

The Committee members discussed possible ways to finance the complex. Ms. Gibbs advised the Committee members with regards to the information collected by Mr. Pellegrino.

The Committee members agreed to draft an outline on how to proceed.

The Committee members discussed borrowing the money now and investing the money until it is needed.

The Committee members discussed millage.

The Committee members discussed the proposed plan for the Municipal Complex expansion. The members would be provided a copy of the proposed plan in their May packet.

The Committee members met briefly in Executive Session.

Resolution 2003-R-13 Policy for Reserve Fund Balance

Mr. Schenkman advised the Committee members with regards to Resolution 2003-R-13, Policy for Reserve Fund balance. Members were provided a copy for their review.

Mr. Vance advised that he feels 20% is too high and the excess funds should be put into the Capital Account.

Ms. Gibbs advised on how the Township budgets for Capital Projects.

Ms. Gibbs advised the Committee members on how Resolution 2003-R-13 was established.

PRIVILEGE OF THE FLOOR

The Committee members discussed the Municipal Complex and the possibility of having to raise Township taxes.

The Committee members discussed the taxes that residents are currently paying to the County and the School District.

The Committee members discussed the possibility of all of the Township Committee’s getting together to get to know one another.

Mr. Vance questioned when the Department Heads would begin making their Budget presentations to the Committee. Ms. Gibbs advised the Budget presentations are scheduled to begin at the May meeting.

The Committee members discussed providing each other with a listing of their address, telephone numbers and email address. Ms. Gibbs advised that information would be mailed in the member’s May packet.

Mr. Vance commented with regards to the Township hiring a grant writer. Mr. Schenkman advised.

The Committee members discussed a meeting that took place in Northampton Township with regards to grant writing.

The Committee members discussed the recently increased Emergency and Municipal Services Tax and how to apply the excess funds.

The Committee discussed having the Township contact the local Colleges/Universities to discuss the possibility of some videotaping projects.

The Committee members discussed the possibility of having some volunteers for matters related to public relations.

ADJOURNMENT

There being no further business to come before the Committee, the meeting was duly adjourned.

The next meeting is scheduled for May 18, 2006 at 7 P.M.

 

Respectfully submitted,

 

_________________________________
Christy Holley, Recording Secretary