Editorial: Borrowing and debt
Amid some difficult decision-making, town officials deserve appreciation for the discipline they have long exercised concerning the town’s capital spending and debt.
The town’s debt peaked near $140 million in the early 2000s when school construction borrowing from the $90-million school bundle followed fast upon the $34-million Scotts Ridge project. Debt is now below half that — under $61 million come June.
Town debt service is $11,523,000 for 2017-18 and falls to $11,037,000 next year — about $9 million of it principal and $2 million interest. That 4.22% decline will save taxpayers $486,000, almost half a million dollars.
This isn’t good luck. Every budget year, officials work to reduce borrowing, going through long lists from department heads and cutting out projects and purchases to hold down the new debt added while paying down the old.
The selectmen are currently trying to get a list of 2018-19 capital proposals — which started much higher — down from $3 million to about $2.75 million. A school computers and software replacement that affects school security was reduced — a mistake officials seem sure to correct as budget work continues.
But vigilance to constrain borrowing should continue.
Back in 2015, the finance board and selectmen moved $1.5 to $2 million in annual road reconstruction from the capital budget — financed with borrowing — into the operating budget, paid straight out of taxes. It meant an uncomfortable bump-up to that year’s tax rate increase. But borrowing was lowered about $2 million a year since then, reducing the new debt that gets heaped upon the old and speeding repayment of outstanding debt.