ENFIELD TOWN COUNCIL
MINUTES OF A SPECIAL MEETING
MONDAY, MAY 19, 2008
A Special Meeting of the Enfield Town Council was called to order by Chairman Kaupin in the Enfield Room of the Enfield Town Hall, 820 Enfield Street, Enfield, Connecticut on Monday, March 19, 2008. The meeting was called to order at 5:33 p.m.
ROLL-CALL – Present were Councilmen Bosco, Dumont, Edgar, Jones, Kaupin, Lee, Kiner, Mangini, Nelson and Ragno. Councilmen Crowley was absent. Also present were Town Manager, Matthew Coppler; Assistant Town Manager, Daniel Vindigni; Town Clerk, Suzanne Olechnicki; Town Attorney, Kevin Deneen; Director of Finance, Lynn Nenni; Director of Economic Development, Raymond Warren
Present from Blum Shapiro was Jerry Parish.
Mr. Parish stated this report is similar in format as the past few years since they converted to GASB 34. He noted this report is submitted each year to the Government Finance Officers’ Association for their Certificate of Achievement and Excellence in Financial Reporting Program.
He noted the report begins with a little introductory information, a letter of transmittal prepared by the Finance Department and the financial section, which is the main part of the report.
Mr. Parish stated they issue multiple opinions on things such as governmental activities, the major funds and all the other information.
He stated they conducted this audit in accordance with general accepted auditing standards and government auditing standards. He noted in their opinion, the financial statements are fairly presented in all material respects.
Mr. Parish explained that immediately following the opinion is management’s discussion and analysis, and this section is also new with GASB 34. He noted this is a summary prepared by the Finance Department covering the financial highlights of the year.
He noted Exhibit #1 through Exhibit #9 are the basic financial statements. He noted Exhibits #1 and #2 are the two new statements that came in with GASB 34, and it’s a statement of net assets and a statement of activity for all the Town’s governmental activities all rolled up into one. He noted it includes everything the Town does, except for the pension and agency funds. He stated it uses a different basis of accounting than the General Fund and Special Revenue Fund that the Council is use to seeing.
Mr. Parish stated beginning on Page 3, there is the balance sheet for the governmental funds and all the major funds are listed on Exhibit 3—the General Fund, Water Pollution Control, bonded projects, capital non-recurring funds. He noted when an opinion is given, it’s given on each major fund.
He stated Exhibit #4 is a revenue statement related to those same funds. He noted Exhibits #5, 6 and 7 are the activities of the internal service funds. He pointed out the Town maintains two internal service funds – the information technology fund and a self-insurance fund, and the details of those are on Pages 57 through 59. He explained what is reported here and what they give an opinion on is the combined totals of those funds.
Mr. Parish stated Exhibits #8 and #9 deal with the pension fund and all the fiduciary funds. He noted the agency funds are basically funds that are not the Town’s money, but the Town is holding money for other people. He stated generally reported in that area are funds such as the student activity funds, which are maintained by the Board of Education. He stated the pension fund ended the year with $78 million dollars in assets, and the change in net assets was almost $9 million dollars last year. He pointed out Enfield’s fund, along with most other municipal funds, had a good year as of June 30th.
He stated the financial statements are the next significant part of the report. He noted there are no new disclosures this year. He stated there are quite a few disclosures in terms of cash investments, capital assets, debt and pension plans.
He referred to a couple of other sections of the report, i.e., the required supplementary information, however, this is a section of the report that isn’t audited by his firm, but they do some inquiry and questioning of management regarding the preparation of the schedules and the content.
Mr. Parish stated the Undesignated Fund Balance as of June 30, 2007 was almost $11 million dollars, which was practically unchanged from 2006 when it was $10.6 million dollars.
He stated tax collection is reported on Exhibit A-2, and tax collections were just a little short of 98% on the current year list, which is the norm for most towns for last year.
Mr. Parish stated the next couple sections of the report get into the detail of the non-major governmental funds. He noted the Town maintains a number of different funds for various purposes. He stated some are for specific uses, i.e., the cafeteria fund for the school system, the dog fund, miscellaneous school funds, community development programs, drug enforcement programs, etc. He explained all of these are generally established when there’s a specific need to segregate or account for those monies separately.
He stated the self-insurance fund has approximately $10 million dollars in net assets. The information technology fund is just getting going as of June 30, 2007.
Mr. Parish stated there are a couple other schedules that relate to capital assets, and those are not required schedules. He noted there’s also a statistical section, and this is not an audited section and is prepared by the Finance Office and provides ten-year tables and information. He stated this is helpful for the rating agencies to look at this information when they’re considering whether to change the Town’s rating.
Councilman Mangini stated she’s pleased to see the Town is up to speed with GASB 34 and 43. She questioned if there’s been any difficulty implementing things. Ms. Nenni stated GASB 34 was implemented three or five years ago. She noted last year, they had to add infrastructure onto the books. Mr. Parish added the new challenge is GASB 43 – post employment benefits. He stated the Town didn’t establish a trust for those benefits, so the first part of the statement wasn’t effective last year. He noted the Town will need to get an actuarial evaluation done in order to identify what the liabilities are and they will have to get recorded. Ms. Nenni added an evaluation was performed in 2006, and another will be done this year.
Mr. Parish stated they also issued reports regarding compliance with federal and state grants. He noted they changed the format a little this year. He stated in the past they put all of their comments in one letter, but this year they’re using two letters. He noted they separated significant deficiencies and material weaknesses into one letter and all other comments into another letter. He explained the letter that includes significant deficiencies and material weaknesses is now included in the bound reports for the federal and state reports. He then referred to Page 8 of the state single audit report, and the title of the report is “The Independent Auditor’s Report on Internal Control Over Financial Reporting and Compliance Based on an Audit of the Financial Statements Performed in Accordance With Government Auditing Standards”. He pointed out this is a required communication. He stated under some new standards that went into effect last year, they’re required to report in writing any significant deficiencies and material weaknesses. He noted they reported one significant deficiency, and that relates to general ledger maintenance. He referred to the 2006 management letter and noted a lot of the same items were reported. He stated they recommended the control procedures be strengthened as they relate to the year end procedures to insure the accuracy of the Town’s financial records and limit the number of audit adjustments. He pointed out when they come in and have to make significant audit adjustments at year end to get the books into balance for grant programs or whatever, it casts doubt on the reports the Town is getting during the year. He stated the focus is to improve the accounting in all of these areas so that the Town gets better and more accurate reports during the year.
Mr. Parish stated as concerns the state and federal reports compliance with state and federal regulations for the programs they’re required to test, they have no findings to report.
He spoke about other new standards and noted one of them deals with communicating with those charged with governance, which would be the Town Council. He stated standards require them to have a little more communication at the beginning and end of the audit. He noted they would explain what is going on and how they’re approaching and planning the audit. He pointed out other towns are coming up with audit committees in order to make this a less unwieldy process. He suggested the Council at some point establish an audit committee or designate certain persons to act as liaisons for these planning purposes.
Councilman Nelson questioned how Enfield is doing, and Mr. Parish stated because there was a significant deficiency this year and the comments that show up in the management letter have shown up for two or more years, a little attention can be focused in those areas. He suggested there be a quarterly or twice per year response from those departments mentioned in the report to see what corrective action, if any, they’re taking. He pointed out some items are fairly easy to fix.
Councilman Ragno thanked the auditor for this comprehensive audit report. He noted he especially likes the breakdown that was provided and the highlighting of repeated items. He stated he likes some of the commentary since it validates what the Council has been thinking all along.
MOTION #9847 by Councilman Ragno, seconded by Councilman Jones to go into Executive Session to discuss Personnel Matters, Pending Litigation and Real Estate Negotiations.
Upon a SHOW-OF-HANDS vote being taken, the Chair declared MOTION #9847 adopted 10-0-0, and the meeting stood recessed at 6:04 p.m.
The Executive Session of the Enfield Town Council was called to order by Chairman Kaupin at 6:05 p.m.
ROLL-CALL – Present were Councilmen Bosco, Dumont, Edgar, Jones, Kaupin, Kiner, Lee, Mangini, Nelson and Ragno. Also present were Town Manager, Matthew Coppler; Assistant Town Manager, Daniel Vindigni; Town Attorney, Kevin Deneen; Director of Economic Development, Raymond Warren; Town Clerk, Suzanne Olechnicki
Personnel Matters, Pending Litigation and Real Estate Negotiations were discussed with no action or votes being taken.
Chairman Kaupin adjourned the Executive Session at 6:37 p.m. He reconvened the Special Meeting at 6:38 p.m. and stated that during Executive Session the Council discussed Personnel Matters, Pending Litigation and Real Estate Negotiations with no action or votes being taken.
MOTION #9848 by Councilman Jones, seconded by Councilman Lee to adjourn.
Upon a SHOW-OF-HANDS vote being taken, the Chair declared MOTION #9848 adopted 11-0-0, and the meeting stood adjourned at 639 p.m.