After receiving bids for a loan to repay the $2 million bond used to fund Wiscasset’s withdrawal from RSU 12, the Wiscasset Board of Selectmen voted unanimously at its Tuesday, Jan. 5 meeting to accept the loan terms originally presented to the board in December 2015 by The First Bancorp.
The $2 million bond from The First Bancorp, due Jan. 15, will be refinanced with a loan from the same institution to be repaid over a 10-year period. The interest rate of 2.56 percent offered by The First was dramatically lower than the rates received through sealed bids from Bath Savings Institution and Androscoggin Bank.
Bath Savings offered a 10-year repayment plan with an interest rate of 5.87 percent; Androscoggin offered a 10-year repayment plan with an interest rate of 4.05 percent.
A special town meeting will be required for voters to authorize the use of surplus to make the first quarterly payment on the new loan, which was not incorporated into the 2015-2016 budget. Selectmen will schedule the special town meeting and finalize the warrant article to present to voters for authorization of the expenditure at their next meeting.
Wiscasset voters overwhelmingly approved the withdrawal from RSU 12 in November 2013, and authorized selectmen to issue a $2 million bond to use as a line of credit to fund the withdrawal agreement. With the due date for the $2 million bond approaching and the payment not accounted for in the 2015-2016 budget, refinancing was recommended by the town’s auditor.
Selectmen delayed accepting the offer originally presented from The First until more information was received on other loan repayment options, such as a 15-year and a 20-year plan, and the loan was placed out to bid. The original offer, however, proved to be the most cost-effective.
The new loan will add approximately $240,000 a year to the municipal budget, which will cause a 3 percent budget increase, even if the budget of every town department remains flat, board of selectmen Chair Ben Rines said. With the school department also anticipating a budget increase, the budget season will be difficult, Rines said.
Wiscasset Superintendent Heather Wilmot attended the Jan. 5 meeting to support students speaking about Wiscasset Middle High School’s participation in the WGME News 13 School Spirit Challenge and to speak about the budget process at the school department.
One of her goals when she assumed the position of superintendent was to inform and involve the community in the school department’s budget-setting process, Wilmot said. Wilmot has coordinated the schedule of the budget with the town clerk to ensure the timelines between the development of the two budgets are coordinated.
“We want to be as collaborative and proactive as possible,” Wilmot said. Years ago, the board of selectmen and the school committee would schedule a joint meeting to discuss the budgets, Selectman Judy Flanagan said. Flanagan suggested the practice be resurrected.
“It is a difficult task to be fiscally responsible but responsible to student needs as well,” Flanagan said.
With a tax hike already anticipated due to the loan repayment and projected increase in the school department budget, unanticipated expenditures continue to arise in Wiscasset.
The furnace at Wiscasset Municipal Airport’s operating base failed earlier in the week, cannot be fixed, and needs to be replaced, Town Manager Marian Anderson said. The failure of the furnace just occurred and the town has just begun to receive cost estimates, she said.
With a tenant in the building, Peregrine Turbine Technologies, replacement of the furnace is an immediate priority for the town, Anderson said.
Fire Chief T.J. Merry also presented a proposal to selectmen to purchase a fully equipped brush truck from the Alna Fire Department for $7,500. The brush truck would increase the department’s efficiency and effectiveness in responding to brush fires and other emergency calls on harsh terrain, Merry said.
The purchase of the truck would also prevent the fire department from using a half-million-dollar fire truck to respond to calls for downed wires and trees, Merry said.
Selectmen were in favor of purchasing the truck; however, with a new furnace needed at the airport, selectmen were unsure if they should authorize the use of the contingency fund for the expenditure.
Once bids are received for replacement of the furnace, selectmen will decide whether the contingency fund can be used to cover both the cost of the brush truck and the furnace, or if an increased expenditure for one of the items will be included as a warrant article for Wiscasset’s upcoming special town meeting.