Q: How is the project being funded? What will the tax impact be?
A: If the capital project is approved by voters, the $196.4 million referendum would result in an estimated average cost of $252 per year for the life of the loan for a homeowner with a home valued at $288,000. The initial tax rate increase would not take effect until the debt payments begin in 2022, at the earliest. Since there will most likely be three bond issues, the tax rate impact will be phased in over time.
The tax rate is currently estimated to increase 5.9 percent:
- 1.9 percent in 2022
- An additional 2.0 percent in 2023
- An additional 2.0 percent in 2024
The cumulative estimated tax increase for homeowners who have a home valued at $288,000 ($0.875 per thousand of market value) would be $252 annually, $21 per month.
Q: What if we don’t get the higher aid ratio?
A: If the building project is not approved by voters so that we can meet the June 30, 2018 enhanced building aid deadline, the aid ratio would decrease from 69 percent to 52 percent. The reduction in this aid ratio would shift $26.8 million in cost from New York State to local taxpayers over the life of the bond issues. This would also increase the total tax rate increase from 5.9 percent to 8 percent.
Q: Why are we well positioned to take on the debt associated with this project?
A: North Colonie has very little existing debt when compared to similar districts. Some debt will be retired in 2017-18 and all existing debt will be retired by 2023-24. In addition, North Colonie has a large and growing tax base, a strong bond rating (Aa2, AA stable), and interest rates on municipal bonds are at historically low levels.