Regarding the proposed Vienna pool/gym, why not ask people to buy a membership in advance, so we can get an accurate gauge of paying demand for this facility? It’s not as if that’s a novel idea.
I’ve asked myself that, and I’ve heard others asking the same question.
The short answer is, Vienna can’t, because we’re broke. Roughly speaking, all the money available for the Vienna capital fund is already spoken for, thanks mainly to the our very large 2020 bond issue.
So, even if we raise taxes now, assuming normal economic times ahead, we’d have to save the revenues for four years, first, just to be able to be able issue that new bond with the assurance that we have enough money around to make the payments on it.
The upshot is that if we wanted to have a “membership drive” to test the waters, before making a final decision on this facility, we’d be selling memberships in a pool that won’t open for another six years.
Judging demand by offering pre-orders is a standard way of doing business. It would be particularly helpful here, because demand for the facility is the big unknown. But, practically speaking, we can’t do it, because we’re basically broke, in terms of our capital budget.
Extras for experts: What happens if we don’t have normal economic times for the next four years?
Source: Some old Town of Vienna budget. For some reason, the Town has taken all of its archive of budget documents off-line, so I can no longer go back and give an accurate citation as to source. I first posted this chart in Post #547.
The year 2008 saw our last significant economic downturn, a consequence of the collapse of the housing bubble, and the near-collapse of the banking system. (There was a short, sharp recession during COVID, but thanks to the magic of every government in the civilized world showering money on their populations, that was over with in half a year. So that one don’t count.)
While Vienna property values were stable during the 2008-2010 recession, meals tax revenue was not. People ate out a lot less. I guess. And that resulted in the dip in Vienna’s meals tax revenue, circa 2008, shown above. Oddly, it took close to a decade for the meals tax revenues to return to their 2008 level. Why was that revenue number sticky? No idea.
That meals tax money is how Vienna makes the payments on the bonds we have issued a.k.a. money we have borrowed.
With all the loose talk about mass firings of Federal employees, blanket tariffs on imports, plus the end of any COVID- or infrastucture-related stimulus money, I’d guess that some chance of a 2008-style dip in meals tax revenues will factor into Town Council’s final decision on this issue. I heard a citizen voice that concern specifically with respect to our being part of the DC-area economy, at the mid-October Town Council hearing.
The upshot is that there’s a cost to maxing out your credit card. You can’t make a major new purchase in a hurry. And, all other things equal, I’d think your level of fiscal risk-aversion should increase, going forward. And our meals tax revenue is known to fall in hard economic times, per 2008 above. (And, somewhat oddly, stay down.)
This whole Vienna pool thing is a fraught decision.
