Town of Hudson looks to borrow $800,000 for roads
TOWN OF HUDSON—The Hudson Town Board took the first steps to borrow about $800,000 for road work at its regular meeting on Tuesday, March 28.
Brian Reilly of Ehlers financial firm told the board the township has a healthy tax base and no debt, meaning it has few limitations on loans. The town would use general obligation debt, and is authorized to use 5 percent of its total value in general obligation debt, meaning it has almost $15 million available to borrow, far more than the proposed loan.
"You would nowhere even near approach where that threshold is," Reilly said. "You're well within your means to be able to take this on."
Reilly presented an option for the $800,000 loan over a two-year term using the most conservative rate available at 3 percent. This showed the mill rate impact being 42 cents per $1,000 of value.
Supervisor Don Jordan said he wanted to be sure the town would pay off the loan quickly. Jordan said he thought the past referendum for $400,000 failed because it did not set out an end plan.
"We've been here many years as a township having no debt," Jordan said. "I want to make sure we're not pushing this off too many years."
Reilly said the board could establish the schedule any way it sees fit, on a two-year term or up to 10.
Chairman Jeff Johnson said the town can start paying the loan back soon, but borrowing is a necessity.
"It's the only option we have if we want to do any road projects," Chairman Jeff Johnson said.
Jordan said he would support the $800,000 on a two-year loan, with the town paying it back as quickly as it can.
The town's obligation for the debt would pick up in fiscal year 2018.
Johnson said now is a good time to make a move like this, as many of the board members have been a part of town leadership for many years.
"We've got a board with a lot of experience on it," he said.
Public member Wayne Nord said he didn't see notice on this discussion, and the discussion shouldn't have taken place without notice. Johnson said notice was sent to the paper, and that the current discussion was a meeting of the town board, not town electors.
The loan proposal will be up for approval by the board at the May meeting.
Though the board does not need approval from the annual meeting, the topic will be presented there as well.