03/15/2012

Officials recommend comprehensive study to determine long- and short-term capital needs for municipal, school services

A working group of Town and School Department officials are recommending that a consultant be hired to help determine and prioritize both short- and long-term future capital needs.

The group, composed of Town councilors, School Board members and staff met in mid-February to discuss capital needs for both municipal and school services.

The meeting was prompted by discussion of possible bonding for a new library, and by the fact that bonds used to finance school construction in will soon be retired. It was the result of one of four actions approved by the Town Council in February to move the library building project forward [news article]

"Over the next five years the schools will repay about $4 million of debt," according to a meeting report delivered by Councilor Frank Governali, also chairman of the council's Finance Committee. "The Town will also repay about $4 million. This reduction creates the opportunity to investigate whether there are capital needs in town/schools that should be considered as new uses for the freed-up debt capacity," the report says.

At the March 12, 2012 meeting of the Town Council, Governali explained that if no new borrowing occurs, the $8 million payback would reduce total Town debt to $12 million. New debt could replace the old, at no addition to current tax bills, he said. Also, at current interest rates, each $1 million of debt incurred beyond the $8 million being retired would cost the average taxpayer an additional $1.40 a month, Governali said.

There are limits on how much the market will allow Cape Elizabeth to borrow, Governali said. But, "the important question is, 'what are our priorities?' and 'how should this debt capacity be utilized?'"

No cost estimate was available for the capital-needs study, and no scope of work has been established. The group's report suggests the funding for the study come from overlay within the current year's budget.

Town Manager Michael McGovern said a proposal for the study, including scope of work and cost estimate, will come back to the council for before approval.

Professional assistance with the study would be most helpful in determining the educational needs associated with school facilities. Governali cited science labs as an example.

The report lists municipal facilities, including the century-old Town Hall; municipal infrastructure; and the possible purchase of land for open-space preservation; as other areas to be studied.

Officials said the study would not include the library because that building has had a thorough examination in recent years. The capital review effort is not expected to interfere with the work of library building study groups, Governali said.

Elected officials in the working group included Governali, council Chairman Sara Lennon, School Board Chair Mary Townsend, and School Board Finance Committee Chair Michael Moore. Staff members were Town Manager Michael McGovern, School Superintendent Meredith Nadeau and Facilities Manager Greg Marles.