Post #482: Public hearing tomorrow on the $35 million Town of Vienna bond issue.

 

This was originally an afterthought from the last posting, but it got so long I decided to post it separately.  And so that leads to a major caveat:  I haven’t had the time to do my homework on this one.  I’m usually pretty good about getting the facts straight before opening my mouth.  But for this one — which comes up tomorrow — I started to look at it, and I kept coming up with what I thought were some fairly important questions that I don’t think I’m going to be able to answer in time for that meeting.

Anyway, tomorrow’s Town Council hearing looks to be a real Duesy.  You might want to have a look at the agenda (.pdf), and maybe even take a look at the meeting materials if something catches your eye.  Maybe plan to be there, or at least catch it on cable or internet (as described halfway down this Town of Vienna web page.)  I’ll post the agenda at the end of this article, below, for ease of access.

Among other things, Town Council is holding its one and only public hearing on a borrowing $35 million for various construction projects and reserves.  It is a legally required public hearing, and if you have any thoughts on that bond issue you can speak for up to three minutes.  But I suggest you do some homework on it first, because the more I look at that, the less I understand it.  If I have the time, I’ll amend this posting to add links to prior Town discussions of this bond issue.

The amount of the Town’s borrowing represents a significant departure from the past.  In fact, that by itself is so noteworthy that I ginned up that little graph at the top of this post, right out of the Town’s 2019-202 budget, using data take from pages 359 and forward, and adding in the proposed $35 million.  As you can see, we’ve never done anything like this before.

I haven’t looked at the details/done my homework, but my guess is that, in large part, this is made possible by the 50% increase in your water bill (Post #448).  Of which you have only seen the first 20%, so far.   (Some portion of water bill receipts are used to cover the Town’s debt issuance (“capital fund”) costs.)

But now that I think that through, if the Town is counting on those water bill receipts to pay off this debt issue, doesn’t that makes the next three annual votes to raise sewer and water rates kind of a joke?  Has Town Council really put us in a position of “raise the rates the full 50%, or default on our bonds”?  I’ll have to look into that, but that’s my first question.  Are they predicating the payback of these bonds on rate increases that they haven’t yet voted on?  I would certainly hope not, but I don’t know.

Anyway, the proposed sewer and water projects are on top of the Town building itself a new police station, and a few other things, and … hmm.  I don’t really know how they plan to fund even that piece, in the normal fashion (meals tax and hotel room tax), because that, by itself, the police station and other projects amount to twice our normal bond issue.  I guess I really haven’t done my homework.  I sure hope our Town Council has.  I wonder just how much of this is projected to be funded by the water bill increase?

And let’s not forget that the Town capital budget includes $0 to pay for the nearly $5 million Patrick Henry garage.  Yep, we assume that’s free, because we think the Northern Virginia Transportation Authority is going to be stupid enough to pay for all of our merchant/restaurant parking at that site, even though that organization has absolutely no business doing so (Post #446 and Post #447).  (Oh, and let’s not forget that we assume they’ll pay for about half the cost of a garage on Church street, just for good measure.)

If you add in the capital projects that we think we’re getting for free or at half price (the two garages), we’re looking at another, oh, $7 million or so in liabilities on top of that.   (Alternatively, this may be why Town staff are asking for about … you guessed it … $7 million in additional funding as part of the overall $35 million debt issue, to provide “reserves” that, somehow, are earmarked for as-yet-unnamed property acquisition within the Town?)

Anyway, no matter how you cut it, that’s a heck of a departure from tradition.

N.B.:  If you took $35 million in hundred-dollar bills and laid them in a straight line, they would stretch from Vienna to Harper’s Ferry, West Virginia.  So we’re borrowing a a pretty good-sized pile of cash.

And there are a couple of other deusies on that agenda, in addition to the bond issue.  Check it out for yourself.  But in typical Town fashion, the agenda often gives no clue as to the dollar value or other importance of any one item.  So you have to read it carefully, then check the Town web page cited above for whatever details have been made public.

Agenda-66