The following public comment was presented at the meeting of the Amherst Finance Committee on November 28, 2023.
The new cash flow document in the packet today shows the library share being paid much sooner than was shared at your last meeting. It’s important to understand how likely this is and when the library is legally obligated to transfer funds to the Town.
The new cash flow has the library paying its full share by July 2026, effectively in a two year window.
However, in documentation and comments by the Trustees and fundraisers recently, a three year window has been mentioned, with the bulk of the payments coming at the end of the project, in June 2027, or later. Some sources are also contingent on other things, such as raising the $4 million match for the Humanities grant, and hitting energy targets for the Mass Save incentive.
To my knowledge, this cash flow is not a legally binding document, but rather an illustration of a best case scenario.
What IS a legally binding document is the amended Memorandum of Agreement, and my reading is that the library is not obligated to pay their share until a year after a certificate of occupancy is issued, in mid to late 2027.
Will the Council be presented and vote on a revised Memorandum of Agreement that would require the library to meet this much earlier schedule of payments?
What would be the consequences of missing these dates or amounts, since presumably it would mean larger loans and higher interest payments?
How can you assure taxpayers that this schedule will be followed and the Town will not end up paying more than is stated in this memo from the Town Manager?
Two other lines that caught my eye are in Attachment A — Capital Campaign Expenses of more than $1 million, and Jones Interest Expenses of $170,000, bringing the total project cost to $47.32 million.
Is the Town expected to pay this additional $1.2 million? If yes, how is that consistent with the promise of $15.8 million and “not a penny more”? I can think of many more critical capital needs that the Town could use $1.2 million for.
Lastly, we still haven’t seen the impact of the library borrowing on the five year capital plan, and what projects and purchases would be deferred because we have to pay substantial debt service for the library. Nor have we seen the financial model to understand the impact on capital reserves and on the timeline for the fire station and DPW projects.
Related to this is the debt limit, and how much debt capacity that authorizing borrowing for the library project would consume.
Until just now, that information hadn’t been provided, so I had looked up assessed property values and current authorized debt in the State Databank.
If my calculations are correct, even after I remove the authorization for the school project as is allowed per MGL, the Council has already authorized 77% of the $146 million debt limit. If I count the school, we are 40% above the debt limit.
If this supplemental bond for the library is authorized, it looks to me like we would be at 84% of the debt limit, leaving less than $24 million debt capacity.
I assume we would not be able to build a fire station or a DPW for less than $24 million so please help me understand how we would be able to move forward on either project in the next five years.
A recommendation to approve the supplemental bond authorization is stating that the library expansion is more important than the fire station, the DPW, and all critical capital needs. There is not evidence that we can afford them all.