02/27/2023 SELECT BOARD Minutes - Laserfiche WebLink

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The 800 Pound Gorilla Is Still In The Room How we are funding the original $54 for phase one • Grants & other $15 or 27% • Room tax &WIIF $39 or 73% How much do we realize from the room tax & WIIF • According to finance director we get about $1 annually from the room tax but 25% is allocated to the general fund so only $0.750 is available for wastewater debt • Last year's tax levy was $55.7 so at 2%, figure $1.1 from WIIF • Keep the math simple and say we have $2 million from these sources. How much debt will that service ASSUMING we can get interest free debt from the state program for 30 years (hard to believe anybody would go past 30) it would be $60 million. We have used/committed $39 or 65% of the total $12 million to finish phase one — from the warrant item included in today's packet • Assuming we can get grants to cover 27% like we did for the initial $54 that would leave $9 of the $12 to be debt financed. This would bring used/committed up to $48 or 80% of the $60. If the entire $12 is debt that would be $51 or 85% of the total. And based on the latest number I have, that would be only about 450 houses or 5% of the total connected. Even if you doubled it and called it 109,66, that is light years from where you need to be and you have only 20% (or 15%) of your debt service capacity left. HOW MUCH CAN WE EXPECT THE STATE TO LOAN US AT 0% - HOW DEEP IS THE WELL?- WHAT IS THE PLAN? — NOBODY'S TALKING I have in the past written on this topic and have asked town management to let me know what I'm missing and/or why they feel we are in good financial shape. I see an 800 pound gorilla that is not going away. How do you fund project completion without additional revenue sources? Additional Concern: If we do a debt exclusion and can't get interest free financing and/or grants we would be exposed to financing the entire $12 at market rates. Exclusions don't take the money out of the tax base. On a short term tactical level we may be okay — longer term outlook is challenging. Action taken to avoid collision —when taken early have more effect than when delayed. Reallocate the 4% surcharge