Penboscot Bay Press Compass Logo

Penobscot Bay Press
Community Information Services

News Feature

Originally published in Castine Patriot, May 8, 2014
Castine Town Meeting
Final costs of downtown street work added to warrant

by Anne Berleant

What is the cost of infrastructure work on downtown roads? How much will burying utility wires add to that cost? What is the estimated impact on tax payers?

Selectmen discussed the financial ins and outs of the proposed upgrades to the downtown sewer and water infrastructure and for a new look to Main Street on May 5. They are outlined in three warrant articles to be presented to voters at town meeting on Saturday, May 10.

Article 35 asks voters to approve a $5,275,000 bond for the design and construction of improvements to roadways, and drainage, sewer and water systems. This is the second phase of a three-phase capital improvement plan for the village infrastructure.

The cost outlined would be financed with a 20-year bond at an estimated 3 percent interest rate, creating a total with debt service of $7,091,257.

The annual cost of that debt service would be $345,000. But the new bond will have “no impact” on taxes, said Town Manager Dale Abernethy, because the town is paying its final $292,782 payment on the Phase I debt service this fall. Financial Officer Karen Motycka said taxes would increase $2.35 per one thousand dollars of property tax. So, a $5,000 annual tax bill would increase to $5011.75.

The cost of burying underground utilities on Main Street is also proposed to be financed with 20-year bonds, and is broken down into two warrant articles. Article 36-A, a request for a $70,000 bond to fund hook-ups of individual properties into the power grid, must pass before voting on Article 36-B, which is for a $900,000 bond to finance the rest of the project. The total debt service comes to $1,303,985 and would incur an annual payment of $64,700 to be raised through taxation, adding about 31 cents for every $1,000 in payment.

All costs are based on estimates given by consultants on the project, not confirmed project bids, and estimates in financing costs.

“We’ve always in the past been able to design the job [and] put it out to bid” before town meeting, Abernethy explained.

The timeline is to borrow money now “for fall issuance,” Abernethy said, and then put out to bid at the end of the year, with a contract signed and the project ready to start “as early as humanly possible” in 2015.

The plan has always been to stop work during the summer and then resume afterwards.

A fourth article is to approve a surface water filtration system for the Battle Avenue pond, “to give a functioning, additional source of water,” explained Abernethy. “Currently we produce enough water, but if any one source fails or we have an extended drought, we’ll be in trouble.”

The debt service for this project would be $672,157 but, again, the town will end an existing water utility debt service this year that will finance the new project, plus the water portion of the Phase II upgrades, Abernethy said.

These four articles would bring the 2015 municipal budget to a little over $2,400,000. The school budget stands at $1,426,404, creating a total proposed budget of about $3,826,404.

If all articles pass as written, Motycka estimates a 2 percent tax increase.