A meeting of the Trustees Finance and Audit Committee was held at the Boston Public Library, Trustees Room, Johnson Building, on Thursday, January 6, 2011 at 8:00 a.m.
Present at the meeting were: Chairman Evelyn Arana-Ortiz; Trustee Donna M. DePrisco; Trustee Byron Rushing; Jean Capizzi and Krista DeNofrio, City of Boston Budget Analysts; Sean Nelson, Chief Financial Officer; Ed Maheigan, Budget and Procurement Manager; Sean Monahan, Supervisor of Accounting; and Jamie McGlone, Clerk of the Board.
The Chairman noted that she received apologies from Trustee Zamawa Arenas, Mr. Ray Sullivan, and Tony Jordan who were unable to attend due to prior commitments. The Chairman welcomed Ms. Krista DeNofrio, City of Boston Budget Analyst, as a new member of the committee replacing Ms. Jean Capizzi who has accepted a new position at a Boston Charter school.
Chairman Evelyn Arana-Oritz presiding.
The Chairman reviewed the agenda and addressed the first item on the order of business pertaining to the review and approval of Minutes for the Trustees Finance and Audit Committee Meeting held on October 28, 2010. Following discussion, on a motion duly made and seconded, the Minutes of the Trustees Finance and Audit Committee Meeting held on October 28, 2010 were approved.
The Chairman also noted that there was some discussion at the last Trustees Meeting for the committee to invite the representatives from New England Pension Consultants (NEPC) for continuing discussions on investment management and specificity of recommendations which will be addressed pending clarity on the FY12 budget.
It was noted that NEPC continues to recommend that the BPL seek ways to diversify its portfolio. The current asset allocation targets are: 60% Equities/ 40% Fixed Income. As a result of this target, the portfolio is significantly dependant on the equity markets for returns that are exposed to the inherent volatility in equities.
As such, NEPC recommends implementing a 10% target to Global Asset Allocation in order to introduce a number of diversifying asset classes into the portfolio. The long-term goal of this recommendation is to decrease expected volatility without significantly impacting expected returns.
Mr. Edward D. Maheigan, Budget and Procurement Manager, provided background information on the proposed award of contract to convert the card catalog to a digital record. The committee inquired about what will happen with the catalog cards once they are digitized and strongly advocated for retaining the cards given their historical archival importance to the Boston Public Library.
The committee requested an executive summary of the full scope of the phased project be provided to the members of the Board at the next Trustees Meeting to provide greater insight on the long term project including a recommended plan of action on the future of the catalog cards.
Following discussion, on a motion duly made and seconded, the members of the Trustees Finance and Audit Committee voted to recommend approval of the award of contract to the Board at the next Trustees Meeting as follows:
VOTED: "to authorize President Amy E. Ryan, or designee, to enter into a contract with The Donohue Group, Inc., 41 Mechanic Street, Windsor, CT 06095, the most responsive and responsible bidder, a contract for Retrospective Conversion Services, for the period January 1, 2011 through June 30, 2011, at a total cost not to exceed one hundred twenty five thousand dollars ($125,000.00), with an option for the BPL to renew the contract for each of the next two fiscal years (FY12 & FY13). The Boston Public Library Evaluation Committee performed an evaluation of the proposals presented by two vendors as described in the Request for Proposals (RFP), and through this process determined the proposal presented by The Donohue Group, Inc. represented the best value for the Boston Public Library"
Chief Financial Officer Sean Nelson provided an update on the FY11 Operating budget noting that on January 4, 2011, Governor Patrick signed a $330M supplemental funding bill for FY11 that included an additional $350,000 for the Boston Public Library.
This supplemental funding from the state will allow the Boston Public Library to continue to keep all branches open for the remainder of the fiscal year. This means that the four branches scheduled to close at the end of March – Faneuil, Lower Mills, Orient Heights, and Washington Village – are now fully funded through June 2011.
The Boston Public Library Trustees will formally take action on the supplemental funding at their next meeting on January 18, 2011 at the recently reopened Brighton Branch library. Meanwhile, work continues on the development of a sustainable budget for the coming fiscal year and the library acknowledges that while its FY12 budget remains uncertain, all are grateful for the ongoing partnership of the library's many users, friends, community members, and elected leaders.
The CFO reported the library has received its target from the City of Boston for the FY12 Operating budget reflecting a 2% reduction from FY11 and a 6% reduction from the State. The CFO will provide an overview of the FY12 budget planning efforts at the Board meeting based on these fiscal assumptions, including budget round table discussions slated in January and March 2011 in the neighborhood branches and at the Copley library.
The committee heard BPL fiscal updates including on the status of the good progress of the implementation of the Accounts Receivable – Billing Module, which is anticipated to be completed by late January 2011.
The library is in the process of completing Form 990 (Tax Return) for FY10 and upon completion Mr. Sean Monahan, Supervisor of Accounting will forward to the Board members for review and be available for any questions prior to final submission.
Mr. Monahan provided an update on the status of the FY10 Management Letter received from the auditors on operational controls with recommendations for improvements. The recommendations have been prioritized at the request of the committee including the AR Module and the Pay-for-Print program. The recommendations are under review and will be reported on at the next committee meeting.
The CFO noted that the library has retained the same auditor firm, O'Connor & Drew, over the past six years and recommended putting the auditing contract out to bid.
Chairman Arana-Oritz asked that the following BPL fiscal updates be included in her report on the initiatives of the Trustees Finance and Audit Committee at the January 18, 2011 Trustees Meeting.
- BPL fiscal updates
- FY12 Boston Public Library round table discussions
- Form 990 (Tax Return)
- AR Module
- Management Letter
The Chairman reviewed the approved schedule of Trustees Finance and Audit Committee Meetings for 2011 as follows:
- Thursday, Feb 24, 2011
- Thursday, Mar 24, 2011
- Thursday, Apr 28, 2011
The Chairman noted that a Special Trustees Meeting devoted to FY12 budget planning has been scheduled for Thursday, February 24, 2011. Following discussion, it was agreed that the Trustees Finance and Audit Committee scheduled for the same day would be cancelled.
There being no other business, the Trustees Finance and Audit Committee meeting adjourned at 9:00 a.m.
Nancy Grilk, Clerk of the Board