SHIRLEY -- When the Ayer-Shirley Regional High School building project was approved, the overall plan called for phased-in borrowing to finance the member towns' portion of the multimillion-dollar renovation and addition that is now underway. Project costs over and above Massachusetts School Building Authority reimbursement is to be split per the regional agreement, Ayer's share being 60 percent and Shirley's 40 percent.
With the total debt to be stretched over 20 years and a deal struck with Ayer to shoulder a share of existing middle-school debt, the formula split was adjusted via an amendment to the agreement, lowering Shirley's share to 38.5 percent and upping Ayer's to 61.5 percent until the middle-school debt is paid off.
After that, the split will be adjusted based on five-year enrollment averages.
In the original financing scenario, money for the "local share" of the project would be borrowed in increments as the project moved forward and Shirley's first year project pay-in was deferred; the tax rate would not have been affected until fiscal year 2017.
But the overall picture changed some after the district later decided to borrow the entire amount up front to take advantage of lower interest rates, with the tax impact slated to hit sooner than anticipated as a result. The School Committee held public meetings to explain the change of plans at the time.
Now, the bill is about to hit the town's tax rate in the next fiscal year.
Citing a May, 2013 memo in which he outlined a financing plan "slightly different from the original," Treasurer Kevin Johnston told selectmen Monday night that the tax rate impact for the high-school project would take effect 1 ? years earlier than planned.
On the plus side, savings on interest total $800,000 over the 20-year loan period, he said.
Another point is that Ayer has begun cost-sharing in the middle-school debt, per the amended agreement, Johnson said, and because Shirley's share of the high-school debt is minimal in the first year (2014) the result is a "credit" of $163,675 to be placed in a stabilization fund held by the school district and applied to further offset Shirley's share of that debt. The question before selectmen now is how to set up the debt payment schedule, he said.
Principal Assessor Rebecca Boucher explained three debt schedule options on the table.
Option B was a plan that ASRSD Superintendent Carl Mock worked out to "stabilize" payments and she had originally "leaned that way," Boucher said. But after analyzing the figures further, she changed her mind. She now favors the other two options, which in one case would divide Shirley's "credit" (based on Ayer's share of middle-school debt) equally over 10 years and in the other would use the entire amount in the first year to "ease in" Shirley's higher tax burden.
The Finance Team, of which Boucher is a member, was "torn between A and C," she said.
Option A: Applied as a lump sum next year, the tax rate (per thousand) would go up by 38 cents, then jump to 73 cents, then 98 cents after the middle-school debt is paid off.
Option C: If the credit were applied equally, the tax rate would go up 65 cents next year, then 98 cents when the middle-school debt is paid and until the debt exclusion passed for the high-school project expires with payoff of that debt.
Seeking to simplify the proposals the board would consider when all members are present, Dumont inserted a clarifying question. "So that's the money we get from Ayer as its share of our middle-school debt, right?" she asked.
Basically, that's the "it" Boucher referred to, she said, but balanced against Shirley's share of the high-school project debt, it amounted to a credit in the first year. The question then became how and when to apply that credit in the debt schedule, she said.
Until selectmen decide on that issue, she could not provide an accurate tax impact picture, but the numbers attached to the favored options came close and are based on the fiscal 2014 total assessed value of all properties in town and the tax levy. They do not include sewer betterments or future tax increases.
For an average single family home valued at $251,113, the annual tax bill is expected to go up by $152 to $260 for the first five years, depending on the option chosen; $292 or $280 in the next five years and $392 in the last five years of the high-school building project debt. The debt exclusion then expires and the tax rate reverts to its former level, plus any changes added since.