Selectmen Send NYA Lease Modification Back To Drawing Board

By John Voket

The Board of Selectmen Monday heard from Town Attorney David Grogins about a proposed lease modification between the Newtown Youth Academy and the town. But instead of accepting the suggested changes to terms on how the town will interact with and credit Parks and Recreation Department use of the organization’s Fairfield Hills recreational facility, officials made a few suggestions of their own for consideration.

As a result, the lease is still in play.

Mr Grogins said the genesis of the proposed changes came after parks and rec officials began expressing concerns about scheduling conflicts between town and NYA programs at the indoor recreation facility last year. The town attorney said there were “questions about whether the town was getting the hourly rental rates promised” as a condition of the original lease agreement.

He said the original plan was to broker lease payments against 1,600 hours per year of use by the town. And at the point the 1,600 hours were used up, the town would have first right of refusal to book additional time at a discounted rate.

The revision proposes cutting that number of hours of town use in lieu of lease payments to 1,400 hours, and then extends up to 200 hours of use pro bono — or donated outright.

Mr Grogins said the changes outlined why and how these changes would occur, as well as setting the dollar-per-hour rate for the town’s contracted use. The revision also clarifies procedures for resolving conflicts and sets specific times for the town’s use.

Calling the changes “procedural modifications,” Mr Grogins explained that the changes “define how the town extracts its benefits entitled to under the lease.”

Selectman William Furrier clarified that 1,400 hours would be an annual commitment for the entire 40-year span of the lease, as well as asking whether the town would face a use-it-or-lose-it scenario without credit if the hours were not used in a given year.

This prompted Mr Furrier to question if part of the document actually committed the town to something other than a property lease agreement, suggesting that the trade for service constitutes more of a “contract between the Parks and Rec Department and a profit-generating enterprise,” or vendor.

Mr Grogins replied that the modifications posed “an obligation to use 1,400 hours, or to give the youth academy a credit toward the lease,” and said if it pleased the officials, he would gladly take any suggestions back to the NYA representatives.

Mr Furrier persisted, however.

“We don’t have the power to make these kind of purchases, to enter into a contract with a business and commit financial resources into the future,” Mr Furrier said.

First Selectman Pat Llodra responded, reminding the board that prior to its collective tenure, the lease was struck and signed as a mechanism by which the NYA pays its rent, and pays down its financial commitment to the town.

Selectman Will Rodgers said the issue was more of a “political characteristic than a legal one,” but agreed with a point made by Mr Furrier about softening some of the language in the proposal giving the town entitlement to “up to 1,400 hours” of usage, versus obligating the town to use it or lose the full benefit through a full credit against the lease agreement.

“This was an installment concession up front,” Mr Rodgers pointed out.

Later in the meeting, the first selectman revisited the NYA issue, explaining to the selectmen that the town was still in its initial phase of negotiation on the possible future acquisition of part of the facility instead of developing a separate, standalone rec center on an adjacent lot at Fairfield Hills.

Health Plan Savings

During the meeting, the selectmen also heard from Finance Director Robert Tait, who said the final numbers for next year’s self-funded health plan administrative costs were still in negotiation.

Mr Tait said the recent history on the newly created plan shows the town’s workforce of participants is beating trend when it comes to claims, outpacing even his preliminary estimates by at least $100,000 a month or more in the town’s favor.

The finance director told the selectman that had the town not switched to a self-funded program, the current vendor would have billed Newtown $15 million for services in the 2010 fiscal cycle. Instead, under the new plan, the gross contribution to the fund was $13.1 million in claims, administrative costs, and stop-gap coverage.

“That would have increased this year’s budget by $2 million,” Mr Tait said.

He is expecting to finalize the new rate for administrative handling of claims in the coming weeks, and will likely present those revisions before the Legislative Council completes its phase of next year’s budget deliberations. While this will result in savings to the self-insurance fund, Mr Tait said it would have no direct impact on the budget.