Larchmont Prepares for $3.2 Million Makeover:
Bonds Will Fund 6 Major Capital Improvements

by Laura Bintzer

(June 10, 2004) The Larchmont Village Board “gulped” and then took six separate votes in favor of bond resolutions to fund projects that have been in the planning for a long time. The plan is to borrow a total of $3.2 million for one year, and then to re-evaluate the budget for each project with an eye towards rolling the remaining debt into longer-term bonds.

Mayor Ken Bialo explained each project and asked the question that many in the room had on their minds: “Why borrow now?” He offered two reasons.

The first is interest rates. Though not as low as last year, interest rates are still at attractive levels. The second reason is to take advantage of a number of grant programs and other leverage possibilities. With a number of grants already in hand, and a number of others pending or likely, Larchmont is looking at being reimbursed for much of the money it will borrow.

Carmine DeLuca, treasurer for both the Town of Mamaroneck and the Village of Larchmont, said the borrowing plan was really just standard procedure. “A lot of the resolutions are estimated amounts.” He explained, “You have to have a resolution to borrow money and have a bond sale. That’s the normal procedure; we’re ready right now.”

Prior to the vote, Mayor Bialo described each bond resolution, its purpose and its current financial status.

Garbage: Number one on the list is for a new garbage truck. There is currently a fleet of seven trucks that cover the Village of Larchmont; however, two of them are from 1985 and, at this point, inefficient. One new one, for the price of $155,000, would replace the two old ones.

Flint Park: Bond resolution number two is for an expansion of fields at Flint Park. This bond does not include funds for an adjacent environmental waterfront project or for a redesign and replacement of Flint Park’s playground equipment. The bond does cover the estimated cost of new fields, $1,050,000, although taxpayers could end up footing the bill for as little $400,000, depending on the success of grant applications that are being processed, as well as fundraising by sports leagues.

Streetscape: The third resolution is for the Boston Post Road streetscape renovation. This particular bond is for $1,000,000 but Larchmont has already received $150,000 from CDBG (Community Development Block Grants), and another $100,000 with the help of Representative Nita Lowey. With these grants and reimbursements from adjoining property owners, the cost of the Boston Post Road streetscape could end up being $400,000 or less for taxpayers. (For details, see: Proposed Streetscape Project: Sketches Now on Public View.)

Storm water: Next to be voted on were bonds for improving the way Larchmont handles storm water. All municipalities are under state and federal mandates to clean up their storm water run off. To comply, Larchmont must purchase a lot of equipment including: a vacuum truck to clear away major storm sewer blockages, a camera inspection system to locate the blocks, and a portable generating system to power the other equipment. Also needed are hydrocarbon filters and a debris filtering system, which together will greatly reduce the amount of litter running into the Long Island Sound. This endeavor will also be subsidized through a grant obtained with help from Congresswoman Lowey. The storm water clean-up bond totals $550,000, but the net to taxpayers is expected to run around $230,000.

Ice-Patch: The last two bonds deal with the Village of Larchmont’s “ice-patch” problem. This problem occurs when water from sump pumps and gutters on private properties gushes into the street and freezes during cold weather. The water, also known as “dry weather flow” puddles inappropriately when drains are not close enough to take care of the surge. (See: Next Steps to Attacking "Dry Weather Flows)

Bond number five, for $150,000, would fund development of designs for solving the problem at approximately 60 to 70 locations. Bond number six, for $300,000 would be for new storm drains. Thanks to federal and state programs, the taxpayers are likely to pay only 20% of each bill.

The total cost of all six bonds is $3.2 Million. Given all the grants, both received and pending, taxpayers will pay between $1.5 million and $1.8 million, Mayor Bialo estimated.

Why borrow at all? Mayor Bialo explained that the Village of Larchmont does have a $2 million surplus; however, that surplus is at a “comfort level” that bond raters, financial advisors, and the board all feel comfortable with. Furthermore, with a total cost of $3.2 million, even wiping out the surplus would not eliminate the need to borrow.

Mayor Bialo also explained why the village does not intend to “call in the bonds” as soon as the grant or fundraising funds show up. People who are buying Larchmont debt would shy away from that sort of transaction. The current structure allows Larchmont to take out all the debt at once – saving transaction and legal fees. That way even if rates go up, by the time the Village goes to roll-over the debt next year, Larchmont will be ahead.

Ned Benton, a former trustee, was very supportive. “It’s a good thing to invest in our collective back yards” he remarked at the board meeting. He continued to agree that the bond resolution program “sounds like a sensible plan.”

Mayor Bialo responded by adding that everyone took “big gulps” about aiming for a $3.2 million project. Still, because of the current leverage possibilities, “the public gets a lot of bang for its buck,” he concluded. The board joined him in voting unanimously for each bond resolution.

 

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