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WESTERLY — Although an exact figure has not been established, town officials said Monday that residents are not likely to be asked to consider borrowing more than $3 million at an upcoming referendum.
Town Manager Michelle Buck told the Town Council, during its weekly meeting, that Finance Director James Lathrop has said he would be comfortable with borrowing up to about $3 million, an amount she said would entail $500,000 in borrowing costs.
The council has not yet decided what projects the voters would be asked to consider, but on Jan. 27 it approved payment of a $40,000 nonrefundable deposit to be used toward the purchase of about 350 acres in Bradford, off Westerly Bradford Road.
The land, owned by Mary L. Lucey, is seen as an important potential holding to help protect groundwater that feeds the town’s drinking water wells in Bradford. Buck has also noted that some of the land abuts property currently used by Copar Quarries of Westerly. The land has a purchase price of $1.3 million, including the deposit.
Buck said she plans to meet Thursday morning with Stephen Maceroni of PFM (Public Financial Management Inc.), a firm the town uses as financial advisers, to get additional advice on the town’s ability to borrow money through a bond issue. The council has scheduled a special meeting for Thursday night at 6:30 at Town Hall to discuss the referendum.
Buck said officials must take care to ensure that the proposed borrowing does not negatively effect the town’s bond rating, thereby hurting its ability to borrow in the future. She added that she tends to “be more cautious” than Lathrop — who is in his last week as a town employee — and said that while she was not prepared to announce an opinion, she was “not so certain” that she would recommend as much as $3 million. “The concern obviously is to maintain the town’s bond rating. That’s a real concern of mine for a lot of reasons and not just the potential impact this bond could have but other issues that are coming up beyond our control,” Buck said.
After the meeting Buck said bond rating agencies are considering changing how they determine ratings, a change she said could affect the town. The town’s current rating by Moody’s is Aa2, high quality with low risk. Its rating with Standard & Poor’s is AA, a very strong rating comparable to Aa2.
Councilor Patricia Douglas said she agreed with Buck’s cautious approach and added that she believed Lathrop was advising that $3 million was the maximum amount of additional debt the town should take on. “We may not be going down the right road, I’m not sure we should go that high, I need more information,” Douglas said.
The council met with Lathrop in executive session Monday to discuss “personnel” matters. Lathrop submitted a letter of resignation Jan. 28 and is leaving to take a similar position in Portsmouth. His last day in Westerly is Friday.
Other possible referendum questions, which must be decided by Feb. 10, would involve requests for funding for up to $1.5 million to be used as matching money for various grants. The town will soon need to find $150,000 as a match for the River Center project and $255,000 to be used toward the acquisition of properties on Canal Street. Funds will also be needed to acquire property for a planned park on Pierce Street and $93,000 to be used by the town as a match to leverage the $2.8 million cost of dredging Winnapaug Pond.
The School Committee has requested that the council ask voters to consider a $2 million bond for two artificial turf fields at Westerly High School. Jamey Vetelino, athletic director of the Westerly Public Schools, asked that the field question be made separate from all other borrowing requests on the referendum.
Town Clerk Donna Giordano said the Board of Canvassers had set April 5 as the referendum date. Polling places will be Spring Brook School and Westerly Middle School. Polls will be open from 9 a.m. to 8 p.m.