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Had We Settled

I was recently asked how bonding for the new high school impacts the budget to be voted on April 18—a great question as the new school’s cost was voted on in 2011 and the school opened 19 months ago, on time and under budget.

The largest debt service increases due to high school bonding occur in this proposed budget and last year’s—3.95 percent ($3.76 million) of this proposed budget, compared to 2.5 percent ($2.3 million) of our current budget. Next year, the proposed budget will include about $4 million in high school bonding, though the debt service increase of $250,000 will be much less than the previous two years. As expected, high school bonding will peak in three years, then steadily decrease.

Had we not voted for the new high school, would taxes be decreased? Since voting on the new facility six years ago, the overall tax impact is more than $26 million less than predicted due to continued low interest rates, AAA ratings, financing over 20 years versus 30 years, and underspending the approved amount. Had we settled on maintaining the old facility, millions of dollars of repairs would’ve needed to be bonded—for a 60-year old facility—and state reimbursements would’ve been lost. For years, we under-spent on facilities. Even with new bonding, we’re at the state average in debt per capita!

As a Board of Finance member since 2007, I know bonding is just one factor impacting our budget. Hundreds of town and school leaders, administrators, department heads, and volunteers work hard annually to efficiently maintain our essential services. With combined town and school contractual salaries and benefits increasing only 1.20 percent, state funding decreasing $1 million, and high school bonding continuing to impact our budget, a tax increase under 2.5 percent is fair.

Michael Ayles

Guilford