Put on Your Thinking Caps! FY 2017 Budget Discussion

CPHS Oversight Board Meeting 12-17-2015

1. Review Principles

2. Review Formula

3. Review Discount Plan

4. Review Budget

5. Decide on level of services (more, less or same staff hours)

6. Confirm grant funds percentage goal

7. Decide how much of reserve to spend in FY17

FY 17 Budget Development Tasks…

Budgeting Principles Adopted at Oversight Board Meeting Oct.2012

• Keeping all current members is important • Adding new members is desirable

• All members should be charged fairly

• Towns should not be penalized for using the district

staff more

• Increases in town funding are necessary for the long term stability of the district

• Increases in town funding for the health district should be gradual

• The revenue mix for the district should be made up of three things:

– Town membership charges

– Public Health Permit and Inspection Fees

– Grant funds. Reliance on grants for more than a 25% of the budget should not be part of the long-term plan

• Do the principles look OK?

• Want to change anything?

Review Draft Budget

Why increases?

• Insurance is slated to go up significantly

• NOT Randy – he is covered by grants

• Some grant funding covered Paul Lemelin’s 3 hours before, now it does not.

• Lisa is now 25 hours/week year round.

• Council-approved budget included raises for staff based on comparisons to other organizations

• Software maintenance is no longer covered by grant

Primer on our Formula

Our formula steps: 1. Calculates a full budget for the year

2. Divides it up by population size

3. Takes out the cost of the programs that a town does not use

4. Calculates a percent ownership

5. Gives discounts for: a) Permit revenue earned

b) Grant funds

c) Reserve funds

d) Formula transition

Step One: Calculate Population Percentages from 2010 Census

BUCKLAND 12% CHARLEMONT

8%

CONWAY 12%

DEERFIELD 33%

GILL 10%

HAWLEY 2%

HEATH 5%

LEYDEN 5%

MONROE 1%

SHELBURNE 12%

Step 2: Divide the budget up by population percentage

BUCKLAND 12% CHARLEMONT

8%

CONWAY 12%

DEERFIELD 33%

GILL 10%

HAWLEY 2%

HEATH 5%

LEYDEN 5%

MONROE 1%

SHELBURNE 12%

Step 3: Percentage of the budget taken up by each of the 4 CPHS programs

Program Percentages of Total Budget

Nursing/Wellness 40% Title 5 and Wells 30% Food Safety 16% Community Sanitation 14%

100%

Step 4: Apply Cost Reductions to Shared Service towns

Shared Service Town

Service Percentages Reduction Applied

Conway Nursing, 40%, 60%

Deerfield Nursing, 40% 60%

Shelburne Nursing, 40% (may add Food) 60%

Buckland, Leyden, Charlemont, Gill, Hawley, Monroe, Heath

Comprehensive, 100% 0%

Final Step: Each town has a % ownership of the district TOWN % ownership FY 17

BUCKLAND 16%

CHARLEMONT 12%

CONWAY 8%

DEERFIELD 16%

GILL 13%

HAWLEY 6%

HEATH 8%

LEYDEN 8%

MONROE 4%

SHELBURNE 8%

Questions about the formula?

Next Steps to getting to an assessment # for FY17

• Calculate the town’s cost of the whole budget as described above

• Subtract the following discounts:

– Money from the reserve account ($11K in FY16, 17)

– Money from the 25% of the budget we plan to cover with grants ($45K in FY16, 17)

– Money from fees generated by towns that use the health agent ($35K in FY16, 17)

Discount Discussion: What is Fair?

• Should all towns get discounts…

– equally?

– by population?

– by ownership percentage?

– how should we handle grants that do not apply to all towns?

BUCKLAND 16%

CHARLEMONT 31%

CONWAY 0%

DEERFIELD 0%

GILL 16%

HAWLEY 8%

HEATH 14%

LEYDEN 14%

MONROE 1%

SHELBURNE 0%

Nov 2015-16 Fee Percentages

Fees collected at FRCOG, and $35,000 fee discount allocated as a % of how they are earned – only to towns

that generate fees

Reserve fund $11,000 discount allocated by ownership %

BUCKLAND,

($1,766)

CHARLEMONT, ($1,313)

CONWAY, ($925)

DEERFIELD, ($1,798)

GILL, ($1,480)

HAWLEY, ($652)

HEATH, ($724)

LEYDEN, ($918)

MONROE, ($499)

SHELBURNE, ($924)

Grant fund $45,000 discount allocated evenly across all towns

BUCKLAND, ($4,500)

CHARLEMONT, ($4,500)

CONWAY, ($4,500)

DEERFIELD, ($4,500)

GILL, ($4,500) HAWLEY, ($4,500)

HEATH, ($4,500)

LEYDEN, ($4,500)

MONROE, ($4,500)

SHELBURNE, ($4,500)

Goals set last year for FY 2017 • Goal for FY 17 would be to have town funds

(including membership and fees) cover 75% – Done in 2016

• We planned to use approximately $10,000 in

reserve funds to smooth out the increases to the budget from the loss of funds – On track to do in 2016

• We assumed there would be $35,000 in fee

revenue in a year – Last 12 months = $32,500

Fees – How much should we assume?

• Last year at this time we had $30,000, and estimated $35,000 for FY 16

• In the last 12 months we have had $32, 500

Program Reserves: How much to spend? • Funds are safe where

they are, can be used any time in the future as well.

Total available as of December 10 from previous years, due to DIG grants:

$84,000

Required minimum reserve amount for “rainy days” -- 10% of budget

$17,800

Amount planned to be spent in FY16: (with vote of FRCOG Finance Committee):

$11,000

Amount currently budgeted for FY17: $11,000

Amount that would be left for FY 18, 19 and beyond:

$44,200

Overall plan for FY 15-19 FY 15 FY 16 FY 17 FY18 FY 19

budget 163,000 170,000 174,687 180,000 185,000

$ of $61K fund reserve spent 0 $11,000 $11,000 $11,000 $10,000

revenues from fees used in district budget 0 $32,500 $35,000 $37,500 $40,000

25% target amount for grants to cover $ 80,139 $44,641 $43,672 $45,000 $46,250

49% 26% 25% 25% 25%

amount for town assessments to cover $82,861 $79,359 $85,015 $86,500 $88,750

Next Steps

• Give Phoebe some direction tonight • Phoebe will get draft budgets out to members by 12/31

• Vote on final budget proposal at January Board meeting

• Phoebe communicate with Town Administrators in time for

town deadline • Board members invite Phoebe to any necessary Fin Comm.

or Select Board meetings

• Final numbers to towns in time for Town Meeting warrants