🪙 Finance Committee (Fincom) 2-4-26 AI Recap

Below is a summarized version of the Finance Committee, organized by timestamps and speakers, focusing on key points raised during the discussion in Reading, Massachusetts. This summary condenses the discussion into major themes, speaker contributions, and decisions, avoiding excessive detail while retaining the essence of the conversation. Timestamps correspond to the video linked at the bottom.

🗓️ Finance Committee Meeting Summary

📅 Date: February 4, 2026
⏱️ Duration: ~2 hours
🖥️ Format: Hybrid (in-person + Zoom)
🧑‍⚖️ Chair: Joe Carnahan

👥 Members Present: Joe Carnahan, Emily Sisson, John Sullivan, Marianne Downing, Ed Ross, Geoffrey Coram, Endri Kume, Mark Zarrow (Zoom), Joseph McDonagh
🏛️ Staff Present: Matt Kraunelis (Town Manager), Sharon Angstrom (Town Accountant), Chris Cole (DPW Director), Jayne Wellman (Assistant Town Manager), Katie Gabriello (Director of Operations), others as noted
🎯 Main Topics: Snow & ice deficit spending approval, Pleasant Street Center reuse planning, DLS financial policy seminar debrief, Birch Meadow lighting failure update, and future budget schedule

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🔹Public Comment

🕒 7:21–7:28

• No public comment.

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🔹Liaison Reports

🕒 7:28–10:11

School Committee (Geoffrey Coram)

• Superintendent search underway; aggressive timeline to name finalist before April election.
• RISE Preschool Director search also ongoing.

CPDC (John Sullivan)

• Accessory Dwelling Unit (ADU) bylaw updates under review.
• ADU applications tripled in 2025, though total numbers remain modest.

Killam School Building Committee (Ed Ross)

• “We are still building Killam.”

RMLD (Endri Kume)

• Reading Light Department hired new General Manager Jason Small, formerly of Danvers Electric.

Select Board / (Marianne Downing)

• Trader Joe’s officially confirmed as coming to Reading; exact location not yet announced publicly.
• Tax Classification: Select Board approved a shift of 1.14 (up from 1.11).
• Trash Contract: Republic Services contract approved; weekly recycling retained.
• Pickleball Courts: Town received a $100K state grant for construction.

CPA Study Committee (Joe Carnahan)

• After nearly two years of study, the Community Preservation Act recommendation will be presented to the Select Board on February 10, 2026.

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🔹Approval: Snow & Ice Deficit Spending

🕒 10:32–16:27

Context

• Severe storms and unusually heavy icing in early 2026 exceeded the $675,000 snow & ice budget.
• DPW spending to date: ~$705,000 (approx. $35K over budget).

Key Points

• Snow & Ice is the only municipal account legally allowed to deficit spend.
• Private plow contractor participation is steady but more are always needed.
• Overtime costs increased due to Sunday storms and contractual thresholds.

Vote:

Approved unanimously (9–0).

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🔹Pleasant Street Center – Future Use Planning

🕒 16:32–53:03
Presented by: Assistant Town Manager Janye Wellman & Katie Gabriello

Background

• Built 1883, ~4,300 sq ft, historically significant, on preservation register.
• Commercial appraisal (2023): $965,000; estimated net operating rental income ~$72,000/year.
• Once RECAP opens in August 2027, the building becomes surplus.

Constraints

• Building sits on a nonconforming small lot → limits private redevelopment.
• Town cannot lease the parking lot without Town Meeting approval;
  leasing the building alone requires only Select Board action.
• Preservation restriction on interior & exterior (modifiable but not simple).
• Procurement laws require competitive solicitation for sale/lease.

Potential Future Uses

1. Lease to non-profit or for-profit tenants

• Examples from peer towns:
  • Inspire Café (Wakefield – employment for adults with disabilities)
  • Breaking Grounds Café (Peabody – culinary workforce training)
  • Firehouse Center for the Arts (Newburyport – performance venue)
• Could stabilize finances while keeping the building in Town control.

2. Transfer to Reading Housing Authority

• To create affordable senior/disabled housing.
• RHA can leverage state/federal tax credits + historic rehab credits.
• Could support 3–6 “micro-units” depending on layout.

3. Hybrid Use (multiple groups/tenants)

• Town storage (Town Clerk, archival),
• Food Pantry (high interest; represented by Bob LeLacheur),
• Offices for municipal or quasi-municipal groups (Retirement Board),
• Community arts/lecture space (“ANNEX” concept).

4. Full Disposal (Sell Property)

• Considered least favored option by Select Board and by FINCOM (strong sentiment).
• Eliminates future municipal usage flexibility.

Committee Feedback (High-Level Themes)

• Strong opposition to selling; land & historic buildings are irreplaceable (multiple members).
• Leasing seen as appealing but risky—vacancy risk, maintenance burden, need for landlord capacity.
• Significant interest in Food Pantry + Town offices + community use hybrid model.
• Many requested:
  • Cost-to-operate estimates (heat, maintenance, capital needs)
  • Potential multi-tenant revenue scenarios
  • Structural and long-term capital assessment (roof, brick repointing, HVAC)
• Concerns re: becoming a landlord with compliance responsibilities.
• Recognition that the building’s downtown location is highly valuable for civic life.

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🔹DLS Financial Policies Seminar Debrief

🕒 53:03–1:38:03

Reading hosted a regional Division of Local Services (DLS) workshop on financial policies at the Library.
Participants included FINCOM, Select Board members, Town Manager, and Town Accountant.

Key Points

• Reading’s financial management is viewed as disciplined, conservative, and exemplary.
• Many peer communities lack Reading’s level of structure (capital plan, OPEB policy, reserve policies).
• DLS provided templates emphasizing:
  • Capital planning criteria
  • Reserve/stabilization targets
  • Debt management standards
  • Operating budget development policies
  • Peer community comparisons

Committee Takeaways

• Reading’s long-standing 5% capital plan policy is rare and considered a best practice.
• Free cash regeneration in Reading reflects disciplined budgeting, not “padding.”
• Need for clearer policy around:
  • When to use stabilization funds
  • When to replenish stabilization
  • Free cash usage thresholds and triggers
  • Prioritization metrics for capital items (A/B/C rankings)
  • Peer group data updates using objective metrics
• Emily and Joe McDonagh both merged state datasets for peer analysis (nerd points awarded).

Sharon’s Perspective

• Reading budgets conservatively out of necessity, not excess.
• Large state-level guidance (“never use free cash”) is unrealistic under Prop 2½ constraints.
• Recent unusual inflation (rubbish +39%, health insurance +14%) broke long-term stability.
• Reading’s model prioritizes long-term capital preservation → higher short-term free cash use is justified.
• Many MA communities now use nearly all their free cash; Reading remains among the most stable.

Next Steps

• Sharon will begin drafting updated policies.
• Need clarification on which policies require Select Board approval vs. FINCOM approval.
• Joint FINCOM/Select Board session likely needed in spring.

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🔹Birch Meadow Lighting Failure – Update

🕒 1:38:03–1:47:01

• October nor’easter destroyed 4 light poles on the softball field; subsequent inspection found all poles unsafe.
• All poles removed by DPW/RMLD at no cost.
• Insurance reimbursement: $25,000.
• Replacing only the failed poles would cost $70K–$95K, viewed as wasted cost since Birch Meadow Phase 3 envisions full lighting replacement.
• Full replacement likely $300K–$500K, potentially presented at Fall 2026 or Spring 2027 Town Meeting.
• No night use of the field this season without generator lights; men’s softball likely displaced.

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🔹Future Agendas

🕒 1:47:01–1:52:24

• Weekly meetings resume February 25, 2026 for School Budget.
• Town Budget presentation scheduled for March 4, 2026; public hearing on same date.
• FINCOM would like periodic updates on capital project bid status, including Killam & RECAP.
• Possible future topics:
  • Municipal Empowerment Act 2.0 (potential for local-option taxes, senior relief)
  • OPED policy enhancements
  • Peer community statistical analysis

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🔹Approval of Minutes

🕒 1:53:01–1:54:14

• November 5, 2025 Minutes: Approved unanimously.

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🔹Adjournment

🕒 1:54:14

• Meeting adjourned unanimously.
• Chair used the “shiny gavel.”

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✅ Key Outcomes

• Snow & Ice deficit spending approved
• Pleasant Street Center: strong preference to keep building; hybrid civic/nonprofit use favored
• DLS seminar energized policy modernization efforts
• Birch Meadow lights removed; full replacement required (significant capital item)
• Budget season begins Feb 25; heavy workload ahead

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