In an era of caps and circuit breakers that limit property taxes, it’s anything but a nasty four-letter word. On the contrary. In many cases, it’s a God-send.
Monday night, members of the New Castle Parks and Recreation Board listened intently to a presentation by local Economic Development president Corey Murphy. He detailed how, as an old bond issue used to improve Baker Pool is retired this fall, the parks and recreation board could issue a new one to provide funding for future park needs.
And Murphy emphasized, it can be done without raising taxes on New Castle citizens.
“So the tax rate currently dedicated to the park district bond stays put,” Murphy said. “The benefit for the park department is access to those funds to do capital projects, substantial repairs and purchase equipment. It’s quite common for units of local government to do this. The county has done it twice in the last four years. The school corporation does it.
“The reason why it’s common are tax rates,” Murphy continued. “It is very difficult in the era of tax caps and circuit breakers to fund your capital improvement projects out of your normal budget.”
Board members gave unanimous consent for Murphy to move forward with legal procedures concerning a new bond issue. City Council President Rex Peckinpaugh recommended an eight-year $1 million bond. That was one of three options Murphy presented.
“I think that’s best because it gives you the option at the end of the eight years to renew it,” Peckinpaugh said. “You can get a lot done with that million dollars in eight years. And then you could go at it again.”
“Taxpayers aren’t going to see any difference,” Councilman Aaron Dicken added.
Murphy said the bond issue could be arranged so that the existing tax rate of just a little over four cents, issued about 15 years ago, stays basically the same.
The new bond issue at this point is just a proposal. Ultimately, the City Council will have final say on the matter. There will be public hearings and a chance for local residents to comment.
The parks and recreation department has a $50,000 annual budget. But some needs – like playground equipment, upgrades to buildings and landscapes, repairs and addition of new features – would not be possible without additional funding options, Parks and Recreation Director Mike Bergum said.
Murphy said the parks and recreation board needs to come up with a detailed plan of what the $1 million will be used for soon. He pledged to have a detailed timetable of procedures at the board’s March meeting.
“It could be a nice investment in quality of life and quality of space, not only for residents here, but also from a visitors’ standpoint as well,” Murphy said.
Bergum and Board President Patty Broyles also said the bond issue could do another intangible thing to help the city – foster stewardship and a sense of community pride.
Peckinpaugh warned there may be some citizen push-back and education efforts needed to explain why the new bond issue is important.
“There will be people in the community who will not hear the words ‘tax neutral’ no matter how many times we say it,” Peckinpaugh said. “But I think most people will get it.”
“This is being proactive,” Broyles concluded, “something we have never been able to do before.”