Vermont Legislature SmartTranscripts:

[Rep. Matthew Birong (Chair)]: Hey, Gator Live. Alright, folks. Welcome back. House government operations and military affairs, 10:45AM, Thursday, April 16. Hope everybody got your taxes in. Alright. We are taking some more witness testimony, but we were bringing the familiar fix back on h nine zero two, an act relating to the approval of amendments to the charter of the city of Barrie. And we did a run through and some testimony on this a few weeks ago, but a lot has happened in between then and now. And I just wanted to have this city manager come back in and just, like, give us another, primer on what this charter is proposing, I hope you understand it.

[Nicolas Storellicastro (Barre City Manager)]: Good morning. Morning. Thank you, chair, members of the committee. It's good to be here in person this time. I was couldn't join you in person last time, I do like to be here when I can. It's a short drive, it's a nice day. So good good reason to be out. Thank you. Yeah, so I, as I understand that the particular piece we were going to talk about was the fund balance. Have, we actually have two, charter changes before you won, was a really technical, provision to clarify that individuals beyond the mayor, the city manager or any city councilor could, execute sales or leases of city property. That's really a technical thing, because if the mayor was out of town or if there was a conflict or whatever the case may be, it's good to have, options for those things. It would all be duly authorized by a vote of the city council. The fund balance was more substantive. Our charter currently, allows us to retain, maintain, retain, I should say 5% of unencumbered funds as a rainy day fund balance to carry over. This, it's a relatively new charter change in Barrie. It predates me from '20 I started in '22, it predates me, but not by much. It's a relatively, recent change and it turned out to be really important for us, in response to the twenty three and twenty four floods. So we had, we hadn't maintained a full fund balance to 5%. We were maintaining it at reserve. We had created that fund balance, really for reasons that we didn't want to. Had like many other municipalities, we have a lot of vacancies and we carried a lot of vacancies for a long time. Examples, if we carried a vacancy in the police department, that officer's position wasn't filled for the year, the position was funded, the money wasn't expended, that became sort of a savings. At the end of the year, we had that and we could use that to build that 5%. Really through vacancies, we created this 5% fund balance. When the flood hit, what happens with FEMA is we have to pay all the costs up front. So we were very fortunate, that we didn't have to borrow, I think I said a nickel last time, a dime, whatever you want to call it, we didn't have to borrow anything to recover from those floods in 2023, which was really good because then we didn't have the cost of borrowing. The reason we were able to do that is because we had created that fund balance over time, had that piggy bank in reserve, or when disaster struck as it did in 2023. We liquidated our fund balance to recover from the floods for the next couple of years. Were in a tough situation. We had to come back to you. The legislature very graciously gave us some support to get us going, because we didn't have a fund balance after, we had to pay to recover. And so now what we would like to do is, expand the amount of fund balance we can retain from 5% to 10%. Now, what this doesn't do is it doesn't impact taxes. This is all money that would be created by lack of spending, by under spending. So we wouldn't be taxing the residents to fund this fund balance. We wouldn't be taxing them to put money away. This would only exist if we had the funds available to, and we understand at the end of the year and we could put it away as a reserve for God forbid the next emergency. This is, you know, we looked at other charters, in Vermont. There's many other charters that have no limitations on a fund balance. I know for example, I think Montpelier is one that has no limitations. Have my list here. South Burlington doesn't have a percentage limitation. Winooski does not. I don't believe Essex Town does. One we found Shelburne has a 5% limitation now. So there's really, across the spectrum of how other, towns and municipalities handle this. Some of them have, Shelburne like us has a threshold. I'm sure there's others with thresholds, but many others don't have a limit. And it's left to actions of the select border of the city council. These are not decisions that, that are made absent the elected representatives weighing in. That's the same case would be in Berry City. So, yeah, that's, that's where it came from. It really came from our, our efforts to, you know, everything we learned from the flood, we're trying to apply. And this is one of the things we learned that this really helped us recover and it would be good to have, you know, to increase it a little bit because for a couple of years that we, we, we, we didn't have enough to sort of sustain operations beyond the initial recovery. And the 10% would really give us a little bit more room to do that.

[Rep. Matthew Birong (Chair)]: I just want to say it's like, you just parroted one of our mantras in this committee in and around emergency management from COVID to the floods, like learn the lessons, pivot, adjust, and be prepared. So, respect. Red Waters Evans.

[Rep. Chea Waters Evans (Ranking Member)]: Why did you decide to deal with a 10% cap instead of no cap Well,

[Nicolas Storellicastro (Barre City Manager)]: candidly, I would love no cap. But I also respect that the voters in Berry placed a cap on us. And I want to be very respectful of that. And I want to, I think it's about earning their trust. And I think we have earned their trust with the 5%. We've been very candid with voters about how that 5% helped us recover from the flood. They placed that cap. And I think that if we earn their trust with this 10%, maybe the conversation pivots, but at this point, our thought process was the voters gave us a percentage cap, let's keep a percentage cap. Let's make it a little bit bigger to give us more room, but, we want to be respectful of how the city has handled it in the past. Now, if it was my choice, like I said, I'd probably be looking at other language, but we want to be, we want to honor that.

[Rep. Chea Waters Evans (Ranking Member)]: So, has the 10% been brought to the voters?

[Nicolas Storellicastro (Barre City Manager)]: The 10% was brought to the voters, last year and it was overwhelmingly approved. I believe it was, it was at least three to one and I think it received more votes than the other charter change, which is more innocuous. It was very widely supported.

[Rep. Chea Waters Evans (Ranking Member)]: I continue. Sure. What do you do with the other 90%? What do you plan to do?

[Nicolas Storellicastro (Barre City Manager)]: That would be our spend. So basically, whatever, whatever we, if we, so. We keep the 10%, if it's on, if it's on spent anything above that, the city council has authority, they could, they could, they could use it for tax reduction next year. So, for example, we go to town meeting day in May. We changed that also as part of our flood recovery, because it gives us more time to have more data for our budget. So, the budget that's going to the voters in May assumes $255,000 of underspending to bring down the tax rate. So what we can do is

[Rep. Chea Waters Evans (Ranking Member)]: That's what I want

[Nicolas Storellicastro (Barre City Manager)]: to do. Exactly. Things like that.

[Rep. Matthew Birong (Chair)]: Yeah. In that same vein, if your city council opted, do they have the ability to go, hey, we want more than the excess of the tenant, which is $2.55, and we want to go 300,000. Can they get further into that or did they, has it not set up?

[Nicolas Storellicastro (Barre City Manager)]: They could, the 10% would be a maximum. So if they want to keep less than 10% and the council believes it's more important to reduce that taxes in the following year, is an option that the council could have. Other options that council could have. We have as many places do an abundance of infrastructure needs. The council could designate it for the capital improvement fund. One of the things we've done is we've expanded our paving budget to, to do a little bit more paving using those unexpended funds. So, yeah, the 10% would be a maximum. Certainly, there would be the ability for the city council to have other allowed uses of those unspent funds. Yeah.

[Rep. Matthew Birong (Chair)]: I was just about capital. Could you answer your yes? Okay, great. Absolutely. Thank you.

[Rep. Robert Hooper (Member)]: And there's not a floor? Like I know in Burlington, there's a floor or 5% and a cap of 15% with a target for 10%?

[Nicolas Storellicastro (Barre City Manager)]: No floor on this one. This would be just a ceiling.

[Rep. Matthew Birong (Chair)]: Straightforward. Yeah. Alright. No. Thank you very much for the time. We just wanted to run back through this and just have a clear refresher on it. So I think this was really helpful for us.

[Nicolas Storellicastro (Barre City Manager)]: Anytime. Happy to be here anytime. Okay. Thank you. Appreciate it. Alright.

[Rep. Matthew Birong (Chair)]: Committee, that gets us we are moving briefly through our items today. So we'll be back at 11:15 and four work on S-two 98 relating to voting rights. And what we're to do there is a conversation about the sections, or section from H541 that, house and senate judiciary asked us to consider for inclusion. So that's what we got. 11:30 to lunch. With that, constituents