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03/27/2023 09:39 AMAfter several years enjoying diminishing debt service costs, those costs will be swinging upwards to help service debt for several new, large-scale projects now underway in North Branford. However, many recent positives for the Town help balance that news.
The sobering, but not unexpected, debt service statistic was shared by Finance Director Anthony Esposito, who provided information and notes from Town Manager Michael Downes at the State of the Town meeting at Town Hall on March 23. Downes could not attend due to a family emergency.
Hosted by North Branford Economic Development Commission with support from the Shoreline Chamber of Commerce, the meeting also included distinguished guest speaker Lindy Lee Gold, representing the State of Connecticut Department of Economic Development. Gold shared insights on the state of the economy and discussed initiatives underway to drive community growth and prosperity. Look for a related story coming soon.
State of the Town
With several big projects underway -- including the two-phase North Branford High School (NBHS) project, where students are slated to move into the completed, phase one academic wing on Monday, April 17 -- North Branford’s undergoing a time of exciting change. But that comes with a price tag, as Esposito explained.
After state reimbursement funding, the $70 million bonded NBHS project will have $40 to $50 million in remaining debt to be serviced by the Town.
Another major project underway is the $14 million police department and emergency operations center (EOC) under construction at 305 Forest Road. That project will receive $4.5 million in state funding and $1 million in federal EOC grant monies, with the Town paying approximately $9 million. North Branford Intermediate School (NBIS), built in 2009, is undergoing a $10 million major roof renovation this year, due to water infiltration. Bonding was also required to address the need for a new roof at Stanley T. Williams Community Center, although state funding secured by State Rep. Vincent Candelora (R, District 86) may cover the majority of that cost, said Esposito.
“Debt service over the years ebbs and flows,” said Esposito. “If you look back, around the early 2000’s, when we were building the two libraries and the intermediate school and the Augur Farm that we bought, debt service was up. Then it came down for a while, and now it’s flowing back up to a high level.”
As a result, when finalizing the 2023-24 Town budget, the Town Council, which is also North Branford’s Finance Board, will start off with a “built-in” 1 mill increase to debt service costs, said Esposito. The following fiscal year’s budget, 2024-25, will have another built-in 1 mill increase due to debt service, he said.
In addition to what’s being bonded, some other needed projects must be addressed, leading to borrowing from the general fund balance, to cover those costs, Esposito said.
“The council, going into 2022-23, realized the next couple of years are going to be difficult with the built-in increases on the debt service; [and] took $2 million out of the fund balance for projects we have to do around town which can’t be held off.”
The Town’s currently policy calls for a general fund balance equal to 10% to 15% of following year's budgeted expenditures. Having a healthy fund balance is looked upon favorably by bond rating agencies, as it shows the ability to respond to unplanned emergencies.
When the Town Council made the decision to borrow $2 million from the general fund, the balance was at 18% of budgeted expenditures. As of the end of 2022, the general fund now stands at 14%, still well within policy range, said Esposito.
North Branford’s current bond ratings are excellent, Esposito noted. The Town has a Standard and Poor’s AA+ rating and Moody’s AA2 rating. Additionally, Grand List growth last year was up by about 1.72%, generating approximately $770,000 in new tax dollars.
Esposito also said agritourism here continues to shine, thanks in large part to several destination enterprises including Millpond Gatherings, Rosabianca Vineyards, Stewards of the Land Brewery and Rose Vineyards and Winery.
Meanwhile, Commerce Drive recently experienced a “big boom” with the addition of Defibtech, an medical equipment manufacturer, Sparks Cycleworks, an electric vehicle innovator (both businsesses formerly located in Branford), and Hot Tub Discounts store, Esposito noted.
“So it’s an exciting time,” said Esposito. “’We’re very fortunate that people want to come to our town...I think it’s a home run.”
Esposito also shared the Town’s newly-filed 2022 audit revealed a “positive year for 2022,” continuing a pattern of several years of positive financial results in the town. The 2022 audit found favorable variances of approximately $181,000 on the revenue side of the budget and positive variances of approximately $800,000 on the expense side of the budget.
Another area of progress for North Branford has been its decision-making on allocating federal, pandemic-based American Rescue Plan Act (ARPA) funds of approximately $4.2 million. Several projects identified to date include $500,000 for road reconstruction; $500,000 for bridge maintenance; $140,000 for North Branford’s share of the six-town Regional Crime Unit command vehicle; $250,000 to replace the fire tower truck, $385,000 to install a secure, Town-owned fiber network system corridor; $30,00 for a Town buildings door access system; $36,000 for a Lifepack 15 defibrillator; $14,000 for a Hurst “Jaws of Life;” $50,000 as a non-profit spending pool (distribution to be determined); $10,000 toward renovating The Little Red School House (Totoket Historical Society); and $75,000 to be put toward conducting a comprehensive town study of all recreation areas, fields and open space. Approximately $1 million in ARPA funds remain for future designation decisions.
Another recent high point for North Branford has been the September 2022 activation of a 10-acre, 6,000+ solar panel array at 127 Forest Road. The public-private partnership, completed at no cost to the Town, will generate an estimated Town utility cost savings of $10,000 or more per month for the next 25 years (or $90,000 to $120,000 annually). Energy from the array will power area Town installations, including school buildings. The array also provides power to Page Farm (Maple Tree Farm) based on Totoket Road.
At Town Hall, staffing adjustments led by Downes and approved by the Town Council will bring in North Branford’s first Assistant Town Manager, to be hired this year. The new role meets Downes’ goal of creating a succession plan and provides for needed economic development and human resource services. Another multi-tasking role recently filled at Town Hall is Town Planner. On March 23, Town Planner David Perkins, who also serves as Zoning Enforcement Officer, discussed his roles, the commissions with which he works, and projects in the planning. Additionally, North Branford has a new Tax Collector, Gerri Winnick.
The Town website is undergoing a much-needed refresh by web developer CivicPlus, with a release anticipated for late March. The site will provide user-friendly access to a wealth of town government, business and community-related elements.
“That’s the storefront of the town, basically,” said Esposito. “It’s going to be a very useful site.”
The Town’s digital presence is also being improved with a new, “live” product, ClearGov, a digital format allowing for customized searches of archived documents such as budgets.