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A model of policy making with sustainability as an objective:  A roundtable discussion concerning the May 5, 2003, Yarmouth election ballot issue, "Should Yarmouth build a new high school or rehabilitate the old, existing school?"

 

Barnstable County Human Services Department Human Condition 2003 Report

 

To download the Cape Cod Sustainability Indicators Report 2003, click here.

 

Sense & Sustainability: Charting Paths for the Future

 

 

 


SustainCapeCod.Org

A Model of Policy Making with a View toward Sustainability


A RoundTable Discussion Concerning the May 5, 2003,
Yarmouth Election Ballot Issues:

Should Yarmouth Build a New High School or
Rehabilitate the Old Existing School?

[page 2 of 2]

 

Tony Pierantozzi    The borrowing occurs on two levels:  short term in the form of bond anticipation notes (BANs) and long term in the form of bonds.  Only interest is paid on the short-term BANs.  Our plan calls for the long-term bonds to be taken out in 2012.  The cost is based on 6 percent interest--very conservative!  Any arbitrage (the difference between the cost of borrowing and the return on investment) would be listed as revenue in the district books and be used to offset the assessment of the district pupil ratio (the same as the assessment and the BANs and/or bonds cost).  Arbitrage is limited by law.  The process is consistent for both towns.

Allen Larson    Assuming reimbursement, how does the schedule of payments work from the state to the town?  Once the reimbursements start, does the state immediately bring itself current (assume 60 percent) so that the town receives a large lump-sum payment from the state once it starts reimbursing?  Or does the state build into its schedule of payments any amount that then gets stretched out over 20 years or whatever is left of the period of borrowing?

 Tony Pierantozzi    The SBA reimbursement has always been paid in 20 equal installments once initiated by the first payment.

Bill Richmond   Maybe I'm getting old, but $33 million looks like a lot of money to me.  If I had the interest on it for one year, I could probably retire, even at today's interest rates.  And it may be that all the above questions have answers and I haven't paid enough attention to learn what they are.  It sure would ease my mind, however, to know the alternatives. 

Allen  Larson    One thing to keep in mind is that the $33 million is not incurred all at once.  It ramps up in a parallel path while we also get closer to the starting date of reimbursement, realizing that that date is years off.  Perhaps more to the point is the fact that this $33 million figure is spread out over a 27-year period.  We have a chart of anticipated payments based on likely interest rates that will be in place when the borrowing occurs.  Much like a home mortgage, we pay back a portion of the $33 million plus interest each year.  And while this is no small sum by any means, the actual comparison on a year-to-year basis is very much in line with single-year budgeting choices we make each year.  

 

The context of the high school renovations 
financing within the larger town budgets

        For example, this year in Yarmouth, we chose to go forward with the override for the fire department.  On the basis of the average $150,000 house with the current tax rate that we pay per $1,000 (very roughly $11), the actual cost to a Yarmouth property taxpayer for the expanded ambulance service will be more than we would pay for a year of the school capital project. 

        And though looking at it this way might bring the actual year-to-year cost of the school capital project very much in line with other year-to-year choices that we make in our town budget, it reduces our capacity to borrow for other needs that might arise. 

        Perhaps one comparison to make is to keep in mind the way that land purchases of significant size use up the town's capacity to borrow in the same way.  No one seems too alarmed by that constraint whenever land purchases come up.  I'm not sure why the concern rises to the surface when the borrowing is for a school.  But, hey, land takings have a higher priority as evidenced by the actions of town meetings and ballot votes over the years. 

Bill Richmond   I know what the school board goes through with a building project, and I appreciate their candidness.  I will vote to support them, but I hate being put under the gun this way. 

Allen  Larson    I understand that feeling.  And as a member of the town finance committee, I believe very strongly that we (the municipal side) are every bit as responsible for failing to bring this capital issue relating to building renovation forward earlier and to prepare our overall combined budget process (municipal and schools) to address it through our ordinary operating budget process.  There are town-owned buildings that are in disrepair just as there are school buildings. 

Tony Pierantozzi    The Dennis-Yarmouth Regional High School has been well maintained.  The original building opened in 1957, and there were additions to it in 1963 and 1978.  None of these buildings have ever been renovated. 

Allen  Larson    And the following really makes me shake my head:  At town meeting, we approved a debt exclusion to borrow some $700,000 to build the needed new bath house at one of the beaches (I forget which one now).  That passed without as much as a peep.  And we do these things almost every year, whether it's a new water department facility, new police department building, new bath house, new club house, new maintenance shed, transfer station, and so on.  There is no reason to criticize the school for a $33 million renovation project given the scale of that building and its age.  Averaged over several years, we are spending comparable amounts of money on both school and town buildings.  And that is the responsibility that goes along with owning these buildings and offering the full range of services that residents expect.  

        And looking at it another way, how many residents actually utilize golf courses or public libraries or the Old Town House Park and so on in comparison to those who use the public schools (you could even exclude from this number the daily student body and still compare very well). 

        I say these things not as an advocate for the schools or for education but instead with another goal in mind:  to encourage the residents of Yarmouth and Dennis to start thinking of municipal and school functions as one combined set of priorities that defines our town and the quality of life we choose. We get off on a destructive tangent when we isolate one group or another. 

        And this is why I was so encouraged to read your column a couple of Sundays ago.  You were writing in a way that was linking our common interests and concerns.  It was a pleasure to read and a nice respite from the columns that take a more divisive tone and seem to relish pouring salt on the wounds.  Thanks. * * *

Roundtable pages [1] , [2].