Good evening. I will call to order the finance committee meeting on May 1st, 2025 at 6 PM. We have uh two items on the agenda this evening. Communication from the mayor, transfer request of $581,07 from free cash to short-term
interest. uh communication from the mayor transfer request of $4,187,233 from free cash to healthc care trust fund. Um begin with the first item on the agenda, order number 25-1009425. Communication from the mayor. Transfer
of $581,7 from free cash to short shortterm interest to cover the interest payment on a band anticipation note which is a band. Um I'll read the letter submitted by the mayor. Dear council president Oing and
counselors, enclosed for your review and approval is a transfer in the amount of $581,7 from free cash to the short-term interest account. This transfer is intended to cover the interest payment due on a bond anticipation note, which
is a band uh issued on May 22nd, 2024. Uh included with the request is a letter from comproller Brian Dohaney uh which outlines the cost of the band and provides details on the current balance of bond premiums. Please do not hesitate to contact me or my office with any
questions. Sincerely, Jay Christian Dumis Mayor. Good evening, Mr. Mayor. Good evening, Brian. Good evening. if you kind of give a an outline Brian on I know you have the expertise on this to kind of give the finance committee a
little understanding of this please. Sure. So um as I was getting the budget ready going through the bond issuances from last year uh to this year to move forward I noticed there was a ban uh that was taken out last year that had an interest payment due of
873,000. Um, so I looked and noticed there was not, uh, an account to cover that amount of money. So, um, we did find an account that had around 253,000 that we can use to offset some of it, but we can't use it to offset all of it. So, I'm going to I'm asking for our
transfer free cash uh, from this. And next year, you'll see short-term interest in the budget. And then it's 325,000 for next year. It's a less the ban isn't as costly as this year, so I'm banning less. Um, so we've kind of taken care of it the current year with this
transfer and added it to the budget for next year. And I want to thank you for having this meeting so quickly. Um, absolutely. The ban is due June 1st. So I appreciate the time. You're very welcome. Uh, well, you answered my first question because I was going to ask that will this be in the
FY2026 budget for the short term. Um, just a quick question as an example. Say, um, this may have not been caught. we would have been charged uh uh default or interest additional interest payment possibility uh on this band. So what
would have happened is you always want to pay debt service. Correct. So the debt service probably would have gone through say I wasn't here to catch this. Yes. Right. Um the debt service would have been paid at the end of June when they reported the payments to the city
auditor. The auditor said, "Hey, we don't have a account to balance this." Well, now you can't go to free cash. Correct cash is gone. So, the state's going to look at that you deficit spend your account and they're not going to like that and they're probably going to
either pull it from free cash or um you know, they'll send you a nasty letter for sure. Um I'm not sure if you'd have the ability to transfer funds at that point in time or not. You know, that would be another out. Um we'd look at every avenue, but we're trying to avoid that. Thank you. Thank you for I'll open
that up to the committee. Just a clarification though, Brian. I mean, if we got to that point in July, we would have moved what I call we would have taken actions to take money out of reserve for salaries or something to pay it and then figured out what to do later
on. I mean, because we we're obviously not not going to pay the the the ban notice. I mean that my point is you wouldn't have got Diane would have got that notice until she reconciled June which would have been well into July if it beyond the period of time where you
can transfer funds. You would not have that option. No, but I would have taken it out of the fiscal year 26 or whatever the current budget. The current budget. Oh yes, you're correct. Oh yeah. Yeah. No, I know I can't Diane won't let me touch 26. Correct. I was still Dian won't let
me touch anything in the field. So you're correct in 26. Mr. Chair, can I get clarification though? Are you saying this would have been paid regardless of anything being done by the council even though there's no money to take it from? That is correct. It probably would have been paid. You do not want to not pay
your debt service. Um, you know, we do bond and ban every year. If you do not pay on your debt service, you'll it will cause problems. It's almost like defaulting on a mortgage. So any creditor coming to now bid on your bonds and stuff would see that you had a
default. Your interest rate would be a lot larger than what you'd get as a AAA rating. You might even lose your AAA rating at that point in time. So it could be very costly. Who would pay it without a line to pay it from? So they would pay the invoice because they have the
invoice and not assigning an account number at that time. It should not be paid that way, but it's possible that it could have been paid that way. Again, not while I'm here, counselor, but with no one in that office or
someone intram in that office, um, you could have had that problem, right? So, thankfully, we found it thanks to Brian and we're able to pay hopefully with the approval of the transfer. So, we could go down a long path of like whatifs, but thankfully we we don't have
to. No, we're at a good we're at a good spot to be here this evening to take this up. Very thankful for Brian uh council vital. Thank you, Mr. Chair. This this interest payment on the ban that you're saying the debt service we have to pay it every single year. It
doesn't make sense not to pay it. How did we pay it last year? Out of what line item did we pay it last year and previous years? So again, I I didn't look at last year's. I've been here a month and I'm just dealing with the current problems that actually are in
front of you on this. Um, moving it forward. Um, not, you know, not sure whether there was a bond premium they could have paid money from last year. I'm not sure if it was in the budget last year. I just know it's not in the FY25 budget and there is no account for me to go to.
Thank you. Welcome. Thank you, Mr. Chair. Council Det. Thank you very much. Honestly, um you brought up the question basically what would have happened to our bond rating, you know, we you know, obviously this this has to be paid. I
think the issues are raised like, you know, it it's kind of last minute, you know, but it's still something that needs to be paid and it must be paid in this fiscal year. It's paid June 1st. It's due June 1st. Okay. Okay. Um great. Okay. Thank you for the clarification. Thank you, Council. What did you say,
Councelor Brown? Thank you, Mr. Chair. Um, and thank you, Brian, for finding that um that missing amount due. So, um, just listening to all of the discussion and all of my
questions were already answered. I'm going to move to approve the transfer in the amount of $581,7 from free cash to short-term interest account so that the payment can be made on time. Thank you. Thank go.
Motions been made and I will second that uh to to uh approve the transfer of $581,7 from free cash to shortterm interest to cover the interest payment on a bond anticipation note of a band. I would also ask the finance committee if
they were okay to have a suspension with this motion's been made and seconded. Uh any further discussion? Council Det. Thank you very much, Mr. Chair. Um so there will be an account for next year, correct? Okay, thank you for that. Thank
you. Must remain and seconded. All in favor? It carries 420. Thank you. Thank you, Frank. Thank you. Next up is order number 25-1009426. Communication from the
mayor. Transfer in the transfer request in the amount of $4,187,233 from free cash to healthcare trust fund to cover a projected deficit. Um I'll begin by reading the uh letter submitted by the
mayor. Dear council president Oing and counselors enclosed for your review and approval is a transfer in the amount of 4,187,233 from free cash to health trust fund. Uh included with this request is a letter from the compro treasurer Brian
Owen detailing the reasons behind this request. Uh please do not hesitate to contact me or my office with any questions. Sincerely Jay Christian Dumis mayor. Good evening, Mr. Mayor. I don't know if you want to give us a little education
on this. I know it was u it's not something that uh that the council the fiance team wanted to hear. Um but nor did I want to glad we're having this meeting tonight, but if you want to Yeah. So, listen a little bit. Unfortunately, we will not play the blame game. There's numerous factors
that happened with this. Um and Brian can get into those details for for you. Um obviously, it's something that we did not want to send down at all. Um, but it's the perfect storm and here we are today. Again, I'm thankful that Brian caught this um a month in and we're able
to have the free cash to pay this off. Um, it's obviously will be reflected in the budget that was sent down to you as well moving forward. Um, so we are in the thick of it. Thankfully, we are being extremely proactive and um dealing with the health trust moving forward.
Um, it's just something that we need to to pay off and build up that health trust. So, if you have questions, Brian is here to answer that and then you'll see us moving forward with the next year's budget as well. Thank you. I I want to also thank President Austin for
educating me too on the uh uh the uh IA back in 2003 that was signed in by the Bameir Hunt in 2004. So, that always helped for that education. Um so this has in a way happened before. Uh quick
question um to educate me. Uh on one of them Brian it says uh in FY2024 by losing 1,766,27 losing is that if you could explain but by by a loss. Sure. So, how the health trust fund works, um,
the premiums that we pay, well, the employees pay, which I am one of, um, into the trust fund. We're self-insured, so we cover ourselves. So, the claims hit that, the revenue hits that, if the claims are
higher than revenues, you lost money. So, in FY24, they lost it lost 1 point almost $1.8 8 million and that's due to claims and different circumstances and that's through the claims being higher. Okay. Thank you. I thank you for the explanation. I appreciate that Brian. I will I will open that to the finance
committee. Any other counselors that have a question? Council vital. I spent 20 years in human resources and I had a negotiate large benefit package realizing not self-insured programs but had to manage healthcare plans for up to
11,000 people at one time. Um, I had a benefits manager who checked the statements that came in monthly. Once she was done with making sure everything added up, she gave it to me and I checked it over really well. At least I thought I did most of the time. Then I
went off to my comproller or my CFO and they looked over and over. So we had three sets of eyes. We didn't have like a healthc care advisory council. We just had those three sets of eyes and I never remember having any major discrepancies. How did this happen over the last five years or over the
last five years? Let's just say five years with that many eyes. I assume it's a similar process here. How does that happen here? So again, I wasn't here when this started. Um but I
noticed well before I came, let's let's go to the beginning. Before I came, they said, "Hey, we want to set the rate. We want you to look at it." So once my name got in front of the council anticipating that I would get approval, I was having Friday Zoom
meetings for three in a row. And the first thing um I did I again uh thanks to the C auditor, uh Diane, she mentioned Brian, they want to set rates, you know, take a look at the health trust fund. So um you know, my last interview here, I grabbed the sheets
from Diane. So I noticed at the end of FY23 Well, to your point, there's a lot of eyes looking at it, but the main eye is myself and the third party vendor. Those are the people. It does go in front of
the IA. Other people do look at it, but again, that the numbers are large. You got to know what you're looking at, right? So, when I looked at it, I noticed in the fourth quarter of 23, claims rose 1.2 million above the prior
year. Pretty concerning to me. You know, anything over a half million dollars gets my attention. I then noticed the first quarter of 24 was 1.5 million above the prior year. So, in a 6 month span of time, it's $2.7 million above on
a claims base of $8 million. So, the claims now are almost, you know, $11 million. Bells and whistles should have been going off, but they weren't. Um, I I can't tell you why. Again, I wasn't here. I can only tell you what I look at and what I've always looked at when my
time here. So then I noticed the next quarter half million higher. The next quarter is okay. The next million half million dollars higher. So I'm like something's not right here. The recommendation from the third party for this year was going to be
10%. So I immediately said stock. Last year alone should have been 15%. this year. The second quarter of this year was $2.3 million higher than the second quarter of the year before, which was
already a half million higher than the year before that. So, if you look at trends, which is what I look at, they're way out of whack. And to your point, I don't know who was looking at them. Obviously, not the right people or they didn't understand what they were looking at. So when I immediately saw that, I said,
"You're not only last year your recommendation was wrong, but this year your recommendation's wrong. I need to know why." So originally, I'm sorry, I don't mean to go off a little bit, but I'm going to kind of get you where we got there. Originally, I was thinking we weren't getting the right discount because they said their claims were less
than what we were showing. So I originally thought maybe Harvard Pilgrim TUS when they did the merger, we weren't getting our discount. They kept saying, "That's possible. We'll look into it. That's possible. We'll look into it. So, they dragged this on almost a month, if not 5
weeks. So, I kept going through our numbers. Are we recording our discount for RX? Yes. Are we getting our revenues? Yes. Are we paying the admin fees correctly? Yeah. You know, there's a lot of lines here. So, I'm I'm just spending a lot of time. And then on April 11th, they call me and say,
"Brian, we we we agree you we doubled the discount." cuz I'm like, you're doubling something. You're missing the discount. At first, they said we weren't the discount we weren't accounting for. So then, so they were doubling the discount for $2 million for the past 2 years at least. They weren't getting $2
million of claims reported from Harvard Pilgrim to them for the past 2 years. But to your point, when they see what we're reporting and what they see, bells and whistles should have been going off. And these this is the administrator that we pay. This is the administrator,
correct? Do they do they get a flat rate or do they get a percentage of They get a percentage of our plans for life insurance and whatnot and stop loss. So stop loss is anything over 150,000 unless it's earmarked um to cover up
large claims. So we're looking to change how we're structured going forward. So we're looking to change how we're structured for the administrator. We're looking to change how we're structured for health insurance and we're going to put everything out to bid for next year. So,
unfortunately, I can't do anything about that now, right? But I can tell you going forward, we do have a plan and we're going to attack it. And on top of that, the premiums are going up 25%. To cover some of this on top of what I'm asking
here, I don't know if that answered your question, but there's a lot of eyes looking at it, but people weren't looking at the right numbers. Definitely not blaming you, Brian. And I want to thank you for catching catching this because next year we'd be looking at 8,000 $8 million in a hole. So to that point,
if I didn't catch it, you would have lost you're going to lose over $6 million probably this year. If they had set the rate at 10% like they were planning on, next year you would have lost 7 or 8 million. That this would be belly up and the state would probably
tell you you're not going to set your tax rate until you figure it out. Correct. So now you have a real problem. So again, I think you know Diane and I kind of laugh at it. The mayor and I laugh a little, not laughing at the problem, laughing at my timing couldn't have gotten better. I mean, I wish I had been here 2 months earlier, but if I
started in July 1st and you had already set the rate, you got we would be in real trouble. Yeah. And that's that's a reflection of many years ago having the tax rate set and then deciding on getting the tax bills mailed out on time and going forward. Um now another
question that I would have Brian is under this kind of plan I know it's not like the stock market is there something you can put in as a benchmark of when it goes below a certain amount that the well the bells and whistles go like if you're selling a stock short or something like that there's a there's a
watermark that would sure so there's two ways to look at it um I will I'll answer that in a second when we get to the first part so kind of to council vital's issue is if I see claims going up 10% % and we increase premiums 10%. I know I'm
in line. If I went up 10% and claims are going up 20 and 30%. I know I have a problem. So an easy check. So you know that that's kind of that part of it. Um second part. So your question may Oh
just just that if there's something you can put an automatic benchmark in there just like if you're you're you're reviewing a stock and you want to buy it and you want to sell it and you have a benchmark of uh of the price. how we've always looked at it here for self-insured and I've dealt with self-insured in Fitsburg in here you
want IBNR which is incur nor reporter at the end of the year if people have gone to use a health care pair and then on June 30th it stops the bills that come in after is incur reported IBNR the law says you have to cover that in your
trust fund that's probably going to be $2.5 to $3 million we've always taken that also covered three months of payments. So roughly that's another $3
million there. We've always covered the three months of admin fees, there's another million or so dollars. So right now that trust fund with the claims that they're reporting should be around $9 million. And like I said, if it's not there, and
that's why I'm requesting this transfer. And I think as we kind of get out of it with the the premiums 25, if we change our insurance or or look at other carriers that might have better discounts for us, and that helps us, we can get back to where we
need to be, but um right now it's it's not in that position. Okay. No, that answers my question. I was wondering where that benchmark would be. Thank you, Brian. So So again, you might have someone here in my spot, saying, "Oh, we're covering IBNR. It's fine. It's healthy. Yeah. No, you're at the bare minimum. It's not healthy. Mr. Chair,
sorry. Uh, councelor Roby, I've already asked a question, but I just I know the city's always been self-insured. Um, and I know many Oh, not many, but there were other communities that were self-insured that went to the GIC. So, at what point do we as a city look at whether staying
self-insured is viable or whether even though I think GIC went up 10, I don't know if employees heard that comment of 25% increase on the premiums. Yeah, a letter is going is a little scary for
people that thinking, okay, I'm going to get a 3% salary increase. I'm going to get hit with a 25% in cost increase on my insurance. So, is there a time is when is the time to start looking at other options? Sure. So, we'll go out
July for July or August for the admin portion of it. At that, right after that, then we go out for the health insurance portion of it. I would consider a premium product at this point in time. I'm not recommending it by any means, but I think it's something we
should at least have a look at. The problem you have with the premium based products are you're subject now to the market. So, the market goes up 25, you're taking 25. The advantage of self-insured, if they're run right and you have your trust fund established,
you can withstand the peaks and valleys a little bit and you don't have the highs adjustments. Unfortunately, you know, this this wasn't monitored uh for for a couple years now, and it goes quick. I mean, these are big numbers. I mean, you're
looking at a $30 million expense line item. You're welcome. Thank you, councelor. Um, just a quick followup on that, too. I know with the GIC, um, that also has to come probably during negotiation time with the unions. Um, I I think many
years ago that was kind of floated around. Um, but I I That might be a discussion for another another evening. Um, but I am happy that you are looking at other options. But thank you, councelor Roby, because that was a a valid point of bringing that up about the GIC. Um, with that, I'll go to
councelor Naven. Thank you, Mr. Chair. Um, and thank you both for, um, bringing up the GIC. That was the last question I had. Um, so, um, it was front of mind for me cuz the open season for the GIC closes today. So, I was, you know, busily, you know, at the 11th hour scrambling to make sure that my health
my healthcare and everything. It is not a cheap product, but I will say, um, you know, and it certainly has its increases, but I'm glad that it's something that you guys are at least looking for cuz, um, it does provide a decent amount of choice. Um, but it is not cheap. Um, but I think as we're here
to discuss, no healthcare is cheap anywhere this market. I was watching the um the recap from when this happened in 2003 and you know then councelor Bridget was talking about how you know cost is insane on healthcare and it's like well nothing's changed everything's just
gotten worse. So I appreciate that. Um I'm going to ask some questions under the guise uh of veiling my own ignorance and saying that I want to ask questions for people at home um about how some of this works. Um, so outside of the kind of oversight that may have been lacking
um on these particular accounts and I will echo the choir of thanks um for your diligence when you've come in. Um, we have an a contract with a third party administrator that is in that is designed to help us through this process. Is that correct? Correct.
They're designed to help us with setting rates. Setting rates. Okay. So they're setting rates and then as far and they are also this contract is that also helping with the claims that are coming from Harvard Pilgrim. I'm trying to understand that's a separate contract. So that's another contract. That's a contract we deal with Harvard and they
will not tell us exactly what their discounts are. Okay. So I but they told us that they lost $2 million in claims. So the the third party saying Harvard wasn't sending them all the information. So they weren't getting $2 million of claims information they should have been
getting. Got it. And yet we are obviously still responsible because even if a bill gets lost in the mail, it's still your bill. You're just responsible for paying it. Correct. We pay every week. Okay. Um and these contracts expire. I know you said you're looking to go out to bid. When do
these contracts expire? So they expire June of next year. Okay. Okay. Thank you. You're welcome. And it's just a question. Thanks. Council Jet. Thank you very much, Mr. Chair. Um, I might have missed this at the beginning, but how much money is in
free cash right now? So, free cash. Um, I know we have some transfers in front of you, but right now before any of the transfers, it's 13.1 million. Okay. So, four 4.1 is almost 4.2 is a big chunk of that. Correct. Okay. We
still have some things coming down, too. Yeah. Correct. Yeah. Just as far as whack goes, that's a big one. So, yeah. Okay. Thank you for the clarification. So, it's tough tough thing to swallow. This is not a good day. Council vital. I
almost made two years without getting angry from my desk. But this this one issue is kind of getting on my back of my neck. Um it's a 4,000 mistake and we just kind of say, well, no, that not a big deal. We'll just take it out of free cash. But it's not free cash. But that's
money that's supposed to go to our residents in some manner, shape, or form in a new police car or a new park or some something. Not to make up for a mistake. Not to make up for a mistake of many people, not just one or two, but many
people. Um, through the chair, I'm not taking this lightly at all. Um, and if that's the impression that it's coming across, that's couldn't be further from the truth. Um, we settled a litigation with Northro for $8 million that I was
happy to do that to utilize a lot of funds for the residents of this city. And now a good chunk of that is now being taken up because of this. I I feel the pain that you have and it has not been um a a very good month. Um, it's
very deflating and defeating to have to do this. Um, but unfortunately it's a situation that I can't control. um we have to pay it, move forward, correct the mistakes and and move on. Um I obviously had a little bit more time to
process that um because of the scenario and when I was told about this. So um it is very grim and and I I take your sentiments with um concern and with care and I respect and I hear that because it is a disservice to the residents.
And Brian, this is the first time I get a chance to meet you and and impress the hell out of me so far. So, thank you for everything you're doing. But life changes and so forth. And how do I know 6 months down the 6 years down the road, 2 years after you've left your position
that we're right back into this place? How what can you guys guarantee me that was supposed to be guaranteed back in 2003? What how can you guarantee this this chamber that this is not going to happen again? Sure. And through the
chair, if I may answer. So, it's regarding what I've been preaching regarding a secession plan and hiring qualified people that we are actually paying competitive fair wages so we can attract qualified individuals. The previous controller does not work here
anymore. Again, I'm not trying to pass blame, but there's a reason why the previous comproller is not here any longer. Thankfully, we're able to recruit a very highly skilled individual that understands municipal government, understands the healthc care trust, and
very fortunate to attract qualified candidates who are willing to step up to the plate to work for the city. So, what I can assure you, I cannot unfortunately guarantee any type of guarantee that this won't happen again. What I can guarantee is to start looking at
qualified individuals that work for the city to make sure that we are paying competitive. And Mr. Mayor, can can we not have all of our checks and balances with somebody outside of the city like an adviser or because obviously the adviserss that we have hired in the past
have not been top advisers. Can we have, you know, multiple checks here within the city and have the advisers out there so that that these mistakes don't happen or are less likely to happen? Sure. And and that's what we'll be working on in in
the future to come. Absolutely. I mean, my goal as mayor is to set up this city for success, not only for today, but for 10, 15, 20 years down the road. And that's why the secession plan is always important. That's why to set up policies and procedures so when the next administration does come in or the next
controller or auditor comes in, they can pick up where everything is left off. Unfortunately, we didn't have that luxury. Thank you, Mr. Mayor. Thank you, Mr. Chair. Thank you, Council Council Ducette. Thank you very much, Mr. Chair. Um, so I see this um outstanding amount
as something that should have been paid on a regular basis before now. And if it was being paid the way it should have been paid, then free cash would have been less anyway because we would have paid it more. What I am appreciating
here is I haven't seen any flags of penalties or anything else coming out of this. In other words, you know, a mistake has happened, but we are not fined, penaltied or anything else according to this. So, we're able to correct it without any secondary costs
to this. And I think that's important to recognize as well. This is a huge number to suddenly fall down and you know um but understanding that this is also something that needs to be addressed sooner rather than later. So I just wanted to put my two cents in. Thank
you. Thank you. Council Jio Councelor Brown. Thank you Mr. Chair. Um I my feeling is um you know everything that's been said tonight and I think everybody in the room recognizes um what a large number
this is and absolutely appreciates that you located this when you did um so that we can make it right. And just in the in the letter that you wrote, I feel like you you outlined, what the issue is, how we got
to that issue, what we owe, like how it's represented, and then you you say moving forward, we'll be addressing the issue. And I feel like your reput your reput
reputation precedes you. And um I 100% believe that you're going to put into action some things that will prevent this from happening. And from what Mayor Christian had also said, the the succession planning and um just
making sure that we have quality people such as yourself in place to, you know, train the people under you so that there will always kind of be that flow and um hopefully we don't come into the situation where it's always a brand new
hire, someone who has no idea what the history of it was or or all of that. So, I'm just going to be optimistic and hopeful that between, you know, what you found, what you said is going to happen moving forward, the succession planning, and just always having the future in
mind. Um, yes, we have to eat this and like you said, just accept that this has happened. It is awful, but going forward doing whatever we can to make sure it doesn't happen again. So, um, with that,
I will move to approve the transfer of 4,187,233 from free cash to the health trust fund to cover the deficit. Motion's been made. I will second that to approve a transfer request in the amount of 4,187,233 from free cash to the healthc
care trust fund to cover pro to cover a projected uh deficit. also would like to include with the finance team a a suspension as well. Mot motion was made and seconded. Any further discussion, Mr. President? Thank you, Mr. Chair. So, I want to cover a couple things that I
heard just so that uh councilors have things in perspective. Um talking with councelor Presiato today, um he he was very, you know, strongly in favor of making sure he set something up to help prevent this from happening again. And I
go back to 2003 when it happened then under a little different circumstances and and we thought the answer was the independent advisory group to be looking over the shoulder and to see what's happened. Obviously that didn't work out as good as we had hoped. All right.
Um the free cash comments. So we have 13 million but we've got four going to pay this down the health trust fund. We got half a million going to the ban and we got 4 million before us to take up for capital stuff. So, it's going to leave us about 4 million left. There's a snow
and ice transfer about 1.5 million that's going to be coming our way. So, we're looking around $2 million to end the year plus or minus whatever year-end transfers the administration uh may be coming uh um before the council.
I think it's important the councilors understand the rate history. Um because when when actually I'll stop by saying Brian, thank God you're here. I I I don't know how else to say it. I mean what what you're finding is saving the city's AAA rating because we've got a
fire station and a school that are going to look for an enormous amount of money and this would have been extremely challenging if this stuff uncovered itself by what I call other means. So, thank you, Brian. Though I did not like the discussions that we when I had about
it from a you know, rats, how would we find it? Uh I I deeply appreciate the work you did to find them. But to discuss rates, so I went back trying to figure out how how have we been paying for our increases in our health
insurance. Well, the health insurance costs have saw no change in 2022. No change in 2023, no change in 2024. So, the rates that our employees
have paid have stayed the same. I don't know if you're on the city's program. I'm not, but I'll tell you my rates have not stayed the same over those years. In 2025, they went up 5%. And now they're going to go up 25%
for 2026. If I look at what we should have been doing in adjusting those rates at a 5 to 6% increase all along, we'd be at the exact same spot. The problem is we got accustomed to no increase in our health
insurance and now we're playing catch-up. All right. So, so not a good spot to be in. Um, but it's it's just math. It it it works. I challenge Brian saying, "Brian, what
should we be looking at?" And Brian was very good. That's not the council's job. That stops in his office to be looking at what the trust fund because if we're going to sit there and be trust fund managers, you why be on the council? I mean, I mean, what what level do we have
to look at the rate? So, so I said, "Well, what should I be asking when I talk intelligently on trust fund? What should I see?" You always should see a balance of around $10 million, $9 to $10 million to cover anticipated cost. Okay, that's good. So now I know So now I know
what to expect when I see a letter come down at budget time should say I've got plenty of money close to that target value. Will it increase? Okay. But if he comes back and tells me it's less than $10 million, I'm going to be nervous. I'm going to be saying
why. Now, this independent advisory insurance advisory group, I'll be candid. I'm not trying to throw them under the bus, but I don't know what they're doing. What What do they look at? I don't see minutes. I I don't see an agenda. I I don't know. So, I'm
hoping this group there's a light bulb that goes on that they would ask the same stuff. And if they're meeting quarterly, they ask for that type of information so that they can see how the trust is performing. And then finally, how to put stuff in
place. You know, Brian was kind enough to share with me how things happened before he was here, while he was here, when he left, and now that he's back. And there's got to be a policy because it's obvious if something's not written
down on how to run a trust fund. We're just we're going to make the same mistake again when unless we hire a knowledgeable Brian that comes in here that knows how to run a trust fund or knows what to look for in a trust. I mean, two weeks and he's already found
this stuff. I'm nervous for what the next two weeks are going to bring, Brian. Um but but that that that should be something that we think about as well because that's going to be important to help prevent because what we what we said it in 2003. I don't want to be here again saying we got a trust fund deficit. Well that that worked for 20
years. Yeah. Well, we're here again. So we don't want it to happen again. And I believe with what we know now, we'll be in a position. I can tell you in 20 years if it happens again, I won't be on the council. So you you guys will have a
problem on your hands. But the, you know, having the process in place so that controller A leaves, controller B comes. It's just like our financial program. We got to finance policies that say how we handle how money's coming in.
Well, let's amend it to say how what we need to look for in the trust fund. I mean, this isn't hard. Um, and I believe we can do it. So, u, Mr. Chairman, though I'm not a voting member on finance, I do support the motion to approve that transfer with the
suspension. Thank you very much. Thank you. Thank you. I appreciate that, Mr. President. Thank you. Council Vers, before I go to the vote, um I'd like to this this body to receive a a uh for lack of better term, I'm a military guy, standard operating procedures or some
process or some recommendation or some plan going forward that's going to in writing to this body that's going to ensure that this doesn't happen again. What's the role of the advisory council? Who how does they how do they get elected? How long are their terms? What
do they look for? All that belongs in some type of document because I don't want to be like this in 5 years from now saying, "Well, it was that person's fault or that person's fault." If we have a procedure in place, a standard operating
procedures of what how we're going to do how we're going to manage this account, we're less likely to make this mistake again. So, I I I'd suggest that uh Mr. the mayor that you would put together that type of prep
plan with the help of the controller, the adviser, whoever you want to get on how we're going to keep this from going forward. Good suggestion, council, and I'll leave that up certainly to the mayor. Um, I know in the beginning I think you had to have a union member and
some, but I'll I'll let the mayor maybe his um his team can write something up for us. All right, motion's been made and seconded to approve the transfer. All in favor? Any oppose? It carries four to
zero. Only entertain a motion. Thank you. Thank you, Council Brown. Move to adjurnn. Motion's been made and seconded to adjourn. All in favor? It carries 4 to 0. We are journ at 6:41 p.m. Thank you.
Evening. I'm going to call the city council urban affairs committee meeting to order. It is May 1st, 6:45 for a start. And we have two items on our agenda. The first item is order number 25100
9378. Uh referencing order number 211008214C, application for a special permit from Green Meadow Farms LLC to allow for the sale of medical marijuana in addition to the existing sale of adult use marijuana at a facility under
construction at 239 Boston Post Road West. I believe we have Mr. Zawaki who is the CEO in the audience. if you would like to come sit in the well, if you have any opening comments.
Otherwise, I'm just going to go through the comments from the engineers or or the department heads and then go through the special permit. Uh, sure. Chris, CEO of Green Meadows Farm. Thank you so much for having me
back. Um, just opening statement, we have been approved for adult use sales in the city and looking to add medical. We have two other stores um in uh the state uh both of which are adult use and medical and it's um I can certainly get more detail if you'd like but it's adding the medical component is
extremely important to um our family-owned business. Thank you. All right. So, we did receive comments from the department heads. Uh we got from Commissioner Twe from the building department, Tom Deersio from city engineer, Priscilla Ryder from conservation, and Mr. Dr. Dunwoody from
the board of health that they really all had no comments specific to this. Uh Chief Green from the fire department also had no comments and Chief Georgie from the police had stated, "I've reviewed the special permit application and do not have any issues. I did meet
with Mr. Zaraki last week toward the facility and discussed his security plans as well as our experiences with the opening of other dispensaries in the city. With respect to hiring police details for the opening, I did advise that I would follow up with him as his
opening draws closer. The traffic flow and parking area for this facility should not be an issue for other businesses in the area. So, we do have the draft decision on the amendment to the special permit. Uh, some of this I'm going to skip over
because I'll get to the details as we get into the actual um conditions themselves, but it is the finding of facts. The applicant is a duly organized and existing limited liability company having a business
address at 64 Mil Street, Southbridge. The applicant is a tenant at a retail unit located at 239 Boston Post Road, West Malboro, Massachusetts. On May 24th, 2025, the city council of the city of Marorrow voted to grant a
transfer of the original special permit authorizing the applicant to build an operate an adult use marijuana retail establishment at the site. Number four, I am actually not sure if we need this. It reads, "On date XYZ, the city council of the city of
Malbor voted to grant an amended special per excuse me, authorizing expanded use at the site in accordance with article 6 section 25 section 65017, section 65018 and section 65018
um 45 and 46 and section 65032. On February 26, 2025, the applicant filed with the city clerk an application to amend the special permit to authorize the addition of medical marijuana sales to adult use marijuana. In connection with the
applicant, the applicant submitted a certified list of the abuter filing fees attached as attachment one. The applicant certified as the applicant was certified as complete by the building commissioner acting on behalf of the city planner and pursuant to the rules
and regulations of the city council. The city council established a date for a public hearing advertised it and determined that notice of the same was provided to a butters. The Marble City Council pursuant to Massachusetts General Laws Chapter 4A
opened a public hearing on the application on Monday, March 24th. The public hearing was held and the hearing was closed on March 24th. Number 10 is the applicant presented testimony at the public hearing detailing the use at the
site describing its impact upon municipal services, the neighborhood, and traffic. Number 11. At the public hearing, no members of the public spoke in favor of the use and no members of the public spoke in opposition to the use at the site. So based on the above,
the city council makes the following findings and takes the following actions. A just says we've the applicant has complied with the rules and regulations. B. The city council finds the proposed use at the site is an appropriate use and in harmony with the
general purpose and intent of the zoning ordinance. C. The city council finds that the site is located in the portion of the business district along Massachusetts State Highway 20 from the north bro town line to Interstate Route 495 with frontage on route 20 in
accordance with the bylaws. And D in accordance with section 65032C of the zoning ordinance. The city council hereby determines that any adverse effects of the use at the site will not outweigh its beneficial impacts to the city or the neighborhood in view of the
particular characteristics of the site and of the proposal in relation to the site based upon consideration of the following which I'm going to just skim over very quickly. It's the social, economic, and community needs, traffic flow and safety, adequacy of utilities
and public services, neighborhood character and social structure, impacts on the natural environment, potential fiscal impact, hours of operation, requiring that contact information be provided to the chief of police, the building commissioner, and
the special permit granting authority, and requiring payment of a community impact fee if permitted by law requiring the submission of a special permit granting authority of the same annual reports that must be provided to the Massachusetts Cannabis Control
Commission, requiring regular inspections by city officials, requiring employees to undergo a criminal background check, requiring surveillance cameras, and prohibiting the sale of any other materials. the ability for the business
to um provide a secure indoor waiting area. Provide an adequate and secure pickup drop off. Provide adequate security measures to ensure no individual will pose a direct threat to the health or safety of other individuals. Adequately address issues
of traffic demand, parking and queuing, and provide opaque exterior windows. And then in the subject to the following conditions, a lot of that is reviewed again with those more specificity. Um, number one, compliance
with applicable laws. The applicant agrees to comply with all municipal, state, and federal rules, regulations, and ordinances as it may apply to the maintenance and operation of the use of the site. Number two, a site plan review. The use of the site is further subject
to site plan review in accordance with the city of Marble site plan review ordinance prior to the issuance of the building permit as required by section 65032E. Three, incorporation of submissions, all plans, photo rendering, site evaluations, briefs, and other
documentation provided by the applicant as part of the application and as amend or revised during the application hearing process before the city council or the city council's urban affairs committee are herein incorporated and become a part of the special permit
unless otherwise altered by the city council. Number four is compliance with state requirements. In accordance with section 6501845C and 6501846 C, the use at the site shall comply with all statutes and regulations
of the Commonwealth of Massachusetts for the lensure and operation of a medical marijuana treatment center. Number five, transition from original use to new use until such time as the applicant applicant commences medical marijuana
sale at the site. The original special permit shall continue to govern the use at the site. Once the applicant commences medical marijuana sales at the site, this decision shall exclusively govern the use. Number six, security. A. At the
site, the applicant shall maintain a secure entrance lobby waiting area, providing a physical separation between the exterior door of the unit and interior areas of the unit where marijuana and marijuana infused products are dispensed and sold with security
personnel available during operating hours to screen individuals arriving at the unit to ensure that interior areas of the unit are only accessible to qualified patients, caregivers, and to ensure that no indiv individuals pose a direct threat to the health or safety of
others. B. The applicant shall maintain a secure pickup drop off area for patients and products at the site. C. The use at the site shall have opaque exterior windows. D. The applicant shall maintain adequate staffing so that patients may
make purchases in an efficient manner to avoid queuing and impacts on neighboring uses at the site. E. The applicant shall maintain surveillance cameras capable of 24-hour video recording, archiving recordings, and the ability to immediately produce images in, on,
around, or at the use at the site. Number seven, processing and odors. There shall be no processing or manufacturing of marijuana or marijuana infused products as part of the use at the site. Marijuana and marijuana products shall be prepackaged and sealed
prior to arriving at the site. Any odors associated with marijuana and marijuana infused products shall be limited to the interior of the unit. There shall be no onsite consumption or use of marijuana or marijuana infused products associated
with the use at the site. Number eight, hours. The maximum hours of operation of the use at the site shall be Monday through Saturday 900 a.m. to 11:00 p.m. and Sunday from 10:00 a.m. to 9:00 p.m. And
I will note I believe this is an increase of the hours from the special permit we gave to Calver which was 9 to 10 and 10 to 8. So, just to note that, Madam Chair,
does that um match the hours of the special permit that we just approved? And that's what I I I only looked up Calbertie because I couldn't find the other one. So, it might be that there is no change. I'm sorry. I meant the one that we just approved. Um um garden remedies. Thank you. I don't remember
what we did, but I think at this point everybody's kind of doing their own thing there. I'm just So, I This is a change and it matches one that's down the street. I just wanted to or councelor Oing may be quickly looking because he likes to do that. Madam Chair, councelor Det Thank you. Um I
we've had this discussion going back and forth and I think the hours should be very similar to liquor stores. Whatever the standard hours are for liquor stores should be for dispensaries as a general rule. Whatever they may be, please understand that. Yeah. And I I don't know that there even are standards for
liquor stores. They're kind of whatever they want them to be, but and I'm sure that they can. But anyway, um I just I just quickly looked and they it seemed like this was a change if I'm wrong. Councelor Oing.
Thank you, Madam Chair. So, I'm looking at the one that we just did moving garden remedies to the west side of town and item 10 hours. is the maximum hours of operation for the new site should be Monday through Saturday 900 a.m. to 11:00 p.m. and Sunday from 10:00 a.m. to
900 p.m. So they would be the same. The same. Yep. All right. Number nine is contact information. The applicant shall provide current contact information of management and staff to the chief of police, the building commissioner, and the city council. Number 10, annual
reports. The applicant shall submit to the city council the same annual reports that must be provided to the Massachusetts Cannabis Control Commission. 11 inspections and records. The applicant shall make the use available for regular inspections by city officials or their agents and shall
provide city officials or their agents with access to the same records which are applicable for inspections to the Massachusetts Cannabis Control Commission. Number 12, background checks. The applicant shall require that employees undergo a criminal background
check including but not limited to Corey and an additional background check by the chief of police who shall have the authority to disapprove the employment of any persons as a result of said background check. 13. Unrelated materials. The applicant shall not make
available for sale as part of the use at the site any materials or items unrelated to the sale of marijuana, including without limitation, tobacco products, clothes, cigarettes, or ecigarettes. 14. Police detail. The applicant shall employ a city of Malboro
police detail at the site unless the chief of police determines in a letter filed with the city council that a police detail is not necessary at certain times during the operation of the use. In the event a city of Malbor police detail is not available when required, the applicant shall obtain a
private detail. Number 15 is our standard recording of the decision where this has to be filed with the Middle Sex South Registry of Deeds after the city clerk has certified. So that is a quick reading
through basically adding medical marijuana to the existing. Is there any questions, comments from the members of urban council ducet? I don't see any significant issues with
this. I mean, it it's a party change from who the dispensary was to uh the new business. Um the construction's almost completed. So, how quickly do you expect to open assuming that this gets approved?
90 to 120 days. Okay. Okay. Thank you for that. Anyone else? Councelor Fchillo. Thank you, Madam Chair. Um, similar to Council Ducet, no questions or concerns. I think, um, adding medical marijuana to the facility really to me doesn't change
much considering you have the adult use. So, um, I'm in full support of this and in full support of this amendment to the special permit. Thank you. Does anybody want to make a motion? Madam Chair, Council Naven. Thank you, Madam Chair. Um, I agree. Um, I'm supportive of the
adding medical. Um, I think that is, um, smart business practice and will be able to help additional people. Um, so I'm glad you're doing that. Um, and with that, I will make a motion to approve. All right. It's been moved and seconded to approve the application to amend to
allow for the sale of medical marijuana to the construction at 239 Boston Post Road, which seems to be going pretty smoothly. Is there further discussion? Seeing none, all those in favor? 1 2 3 4. We are missing councelor
Presiato who I did talk to briefly and he also was in support of this but obviously can't be here to actually vote on it but didn't have any issues. So thank you very much. Um I can ask for a suspension on Monday
if there's a sense that there's a need to or it can lay on the table. I can report this out on Monday can lay on the table for our actually I could suspend to get it referred to the solicitor and then it would be on the next agenda in
final form for a vote so we can move the process along. So a little bit longer and I think there's full support from the council that we'll finish this up. Great. Okay. Thank you so much. Thank you very much. Appreciate your time.
And our second item on the agenda is order number 2519330A, a proposed zoning map amendment from Rmundo Netto, owner of 36 Jefferson Street to reszone 36 Jefferson Street identified as map 56, parcel 153
from residents B2 neighborhood business. And I believe we have his legal attorney here. if you would like to introduce yourself again and um we can if you have any comments, we'll begin.
All right. Uh thank you so much to the committee for having me here. My name is James McMahon. I'm council for Mr. Neto. Unfortunately, he couldn't attend tonight. He had to attend to a family matter back in Brazil. Um but does express his wish to be here as well. Um, as was explained, we are seeking a
reszoning of the parcel on Jefferson Street. The intent would be to develop a multi-unit uh housing complex there. Um, it would be 11 condo units. We have reduced it in size based off feedback from the neighbors. Um, about a 55% reduction in
the overall size of the project. Um what we're really looking for is um the ability to build under the NB zoning code and if permitted to move to the NB zoning code which does abut this
parcel on two sides. Um every part of the project would be in full conformance with that code. Um however given the restrictions in the current RB zoning um it would not allow a use of the property. We did try to explore alternatives to this including acquiring
some land from the city to allow an ANR and moving ahead on other uh avenues that would not necessitate this resoning. Um we were not successful in that. So um that is what we're hoping to do. Um we gave a presentation at the council meeting um explaining the
project. I don't think we need to run through all of that and we've submitted some more uh materials. Um especially explaining as we view our best conformance with the design standard guidelines that the city has put out. Um
happy to answer any questions um that the committee may have um regarding the project and uh appreciate your consideration of it. All right. So typical for resoning this was also referred to the planning board. They also held a public hearing and they had
a meeting where they have sent us a recommendation. So, uh, council president Michael Oing regarding council order 2419330 proposed zoning amendment zoning map amendment section 6
650 parcel of land located at 36 Jefferson Street identified as map 56 parcel 153. Honorable President OAN counselors, at its regularly scheduled meeting on April 28th, 2025, the board took the following action regarding the above reference council order. On a
motion by Mr. Leventure, seconded by Dr. Finbeby, the board the board voted to send a negative recommendation to the city council on the above reference proposed zoning amendment. The um order the motion carried 5 to zero on a
roll call vote. The board focused on the proposed zoning amendment and not the developer's preliminary concept on how the parcel would be developed and provided the following reasons in reaching its recommendation. The consensus of the board was that the proposed development shown by the
proponent is in keeping with the character of the surrounding neighborhood. However, the board had concerns because the neighborhood business district code would allow for higher density and uses that would not be in keeping with the character of the surrounding neighborhood. In the
planning board's opinion, the proposed zoning change and associated uses would negatively impact the neighbors and argued the parcel is currently zoned with an allowable use of multif family developments. In the planning board's opinion, the developer did not establish that the
proposed zoning amendment would provide a use not found elsewhere. However, the board agreed the city would benefit from additional housing, but expressed the need for low to moderate income housing. And finally, the board concluded without a comprehensive understanding on why
this parcel was excluded from the original neighborhood business district zoning change and the fact that a deed restriction would be required to prevent certain density and uses the proposed zoning change would not be in keeping with the intent and purposes of the
city's zoning ordinance. Sincerely, Sean and Fay, chairperson. So, I'm going to open this up for questions, comments from the Urban Affairs Committee first. Councelor Naven. Uh, thank you, Madam Chair. Um, thank you for being here today. I
appreciate that. Um, I I do echo a lot of the concerns that the planning board um shared in their letter. Um, and quite frankly, this is kind of some the position I often take when we get into zoning. We hear a lot about when we go into these projects and from developers um or proposed projects and they often
require a zoning change first. Um in my six short years here uh we have had a couple of different instances where after zoning has been changed or where zoning allowed something that still required a special permit from this body, we find ourselves in a
position where we end up litigating a denial. um because even though this council chose not to issue a special permit, um the land court disagrees and so we've ended up having projects that um perhaps we don't want or perhaps we
aren't able to shape as well. Um it has taught me that our our opportunity to enforce what we hope to see really comes during the zoning. Um and it often says that, you know, it's the this isn't the project, this is the zoning that we're
talking about. Um, and it is, and I appreciate the the design that's been done. I personally think the proposed project is actually a little bit too big for the neighborhood. Um, I I share the planning board's thoughts that we do need additional housing. I think this particular area of the city has seen
quite a growth of housing. Um, and we'll see it as they come online. Um, as the units come online at the corner of Lincoln and Mechanic and at Cachman and Lincoln as well. Um, so I have a concern with approving a zoning change that could quite frankly, as people have highlighted, um, the development could
be sold. It would be within the owner's right to sell it and that parcel would become a heck of a lot more desirable and a lot more lucrative to sell, um, to a developer that may choose to build it out to its maximum capacity. Um, so those are those are the thoughts that keep me there. Um, I know that other
people want to make comments. Um, but I am happy to make the motion at some point. um if you want me to just do it and then you can continue discussion but I would motion to deny the zoning change. All right, we have a motion. We would continue discussion. Councelor Det. Thank you very much, Madam Chair. Um I
also do not um agree with the zoning change for this. Um you know one that the zoning change is one thing you can't talk about the project because the zoning gives you a different you know land layout to do whatever you want. You
could sell it the next day and someone else can develop it. We can't stop that. Okay. On the other hand, if you come up with a special permit, that's negotiate. That's that's hard negotiation that we can work with. Okay. So, I would rather see something coming through for that
particular property as a special permit versus a zoning change. And I think that that's where we are right now. So, um I would also agree with uh council neighbor as far as uh denying the uh the zoning change. Thank you. Thank
you, councelor Fchillo. Thank you, Madam Chair. Um I do agree with my fellow counselors. I'm I'm not in support of this zoning change. Um I do I would be remiss if I didn't say thank you, Attorney McMahon, for giving this fact sheet, especially about the project itself. But the reality is, like we've
talked about, we have a zoning change before us, not not the actual physical project. And so, um, for that reason, I share in those concern those concerns. If an ownership change were to happen, um, you know, knowing that residents have already said that the original scope of the project was too big, um,
you know, if if some kind of ownership change did happen and expecting something even larger was very concerning to me, um, and I know very concerning to the other counselors. So, I will also not be in support and and I'll be in support of a denial tonight. Thank you, Madam Chair. And I didn't get a chance to respond to the last comment
on the planning board's letter where there without a comprehensive understanding on why this was excluded. And I didn't go back and double check, but I believe when this area of the city was sent to us for reasonzoning that the
mayor had actually submitted that parcel to become neighborhood business. However, when it hit the council and urban affairs, we determined if we made it neighborhood business, it would become e it was currently
um commercial automotive, which meant that it was legally nonconforming. It would remain legally non-conforming because you can't have a single family house in neighborhood business. So, we changed it to RB, which made the house legal,
um, not neighborhood business. So, I I believe that was the rationale for what we did when the zoning was changed. Um, and that would still be my rationale for not changing the zoning today, even though the contention is that the house
would be gone. Um, I think that we need to keep it where it is. And I will quickly read, um, Council Presci was not able to come, but he did would he wanted to have his thoughts at least put out there for the
public. Uh, Madame Chair, fellow committee members, as we've moved along this process from the petitioner, my stance on the matter has remained the same with the intention of reszoning and developing. I have considered the proposal, the location, and the long-standing effect it may have on the
neighborhood. I do not support this zoning change as I did not support the zoning change for the property on Maple Terrace a few weeks ago. Reasoning for the Maple Terrace decision and 36 Jefferson property share similarities with regards to neighborhood cohesion
and future protections, for example, potential high density builds. A few standout reasons coincide with the planning board's ultimate negative recommendation, including concerns about population density. Should the owner choose to sell the property, new developer would have freedom to build
out, does not keep with the surrounding neighborhood aesthetic, and detracts from the rail trail green space by allowing large buildout. For these reasons, I cannot support the zoning change. Thank you, Robert Presiato, W 3, city council. and I can open it up to
any other members that are here if they have questions, comments, concerns. Hearing none, then there is a motion that's been made and seconded to deny. And hearing no further comments or questions from the committee members, I
will call the vote. So motion is to deny. If you are in favor of denying, you would vote yes. All those in favor? One, two, three, four. All those opposed is nobody. And um so the motion follows the
recommendation to deny this. Uh again, this has to be reported out to the full committee which will happen on Monday and then this would lay on the table for a vote of the full council the the following meeting. Thank you. I
appreciate it. Thank you. We appreciate you coming and all the work that you've done and uh Mr. Edto for presenting. Absolutely. Motion to adjurnn. Motion has been made and seconded to adjurnn. All those in
favor and we are adjourned at 7:15.