Financial Committee
of
Lisbon/M.S.A.D. No. 75 RPC
Minutes
October
17, 2007
The Financial Sub-committee of the Lisbon/M.S.A.D.
No. 75 Reorganization Planning Committee (RPC) met at 6:30 p.m. on Wednesday,
October 17, 2007, in the M.S.A.D. No. 75 District Office in Topsham, Maine.
Committee members present were: Elinor “Ellie” Multer (Chair); Martha Poliquin;
Roy Letourneau; Jim Trusiani; and Joanne Reinhart.
Also present was M.S.A.D. No. 75 Business Manager
Ron Lavender.
Recommendations from this meeting are listed below.
1. That
the new district (RSU) assume all of the existing debt
service obligations of
(a) From the point of view of keeping the
books, it will be much simpler. There will be greatly increased work if it is
necessary to keep track of what will be two (and could become three) streams of
debt (yours, mine and ours). It would
also complicate and therefore increase the costs of auditing.
(b) Handling debt service in this manner provides
a small advantage to
(c) This is consistent with our earlier
recommendation that the buildings for which the debt service was incurred
become property of the consolidated unit.
(d) The capital improvements reflected in
the debt service represent improvements to the buildings that will
redound to the benefit of the new unit. If these improvements had not been made, the
new unit would have to make them and incur that debt service.
(e) If there is to be a successful
consolidation, it will be important to encourage all our citizens to think in
terms of a new, joint enterprise rather than in terms of we” and “they.” Consolidating the debt service under the new
unit is one way to support such thinking.
2. That
the new district (RSU) assume all the lease-purchase
obligations of the consolidating units
See above for rationale.
3. Unallocated
Fund Balances & Outstanding Liabilities
(a) Based on local ordinances, Lisbon is
anticipated to have a zero fund balance at year’s end and will have ”paid off”
its liability for teachers’ summer salaries.
(b) M.S.A.D. No. 75 will have a significant
apparent general fund balance ($2.09 million at the end of 2006), but there
will be an unfunded liability for summer salaries against that ($3.02 million
for FY 2006). Pending the audit, that liability is estimated
to exceed the fund balance by about $500,000.
(c) By Law, fairness and common sense, that
deficit – whatever it may be at that time – will become the responsibility of
the towns of M.S.A.D. No. 75
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