Published On: Sat, Apr 6th, 2019

How do they do it?

At the present time, the recently sold serial bonds totalling $8,266,929 are not scheduled to be completely paid off until 2042 unless the town receives some kind of windfall between December 2026 and March 1, 2027.

Of course, given the total debt for Grange Hill and the new town hall, 2042 would seem to be a reasonable repayment schedule even though it means that our children and grandchildren will end up making the last few payments if they choose to make New Hartford their home.

The troubling part is that in order to use a "weighted average life" formula to retire the debt, the town included debt for items with a Probable Period of Usefulness (PPU) of less than the 23 years.

Plus, the town never used the tax dollars that were budgeted and collected in 2018 and 2019 specifically to pay down the principal of the Bond Anticipation Notes (BANs) PRIOR to converting the BANs to serial bonds...they only used $35,000. I have been unable to get acknowledgement of what fund(s) the budgeted money now resides in and how the money is going to be used (more on that later).

An example of debt for items with a PPU of five (5) years or less which are now included in the serial bonds and are scheduled to be paid back in full in March of 2042 are:

Part-town Highway for "garage equipment" - $10,200

General Wholetown for "kitchen equipment" - $75,000

General Wholetown for "computer equipment & software" - $121,697

Police for "computer equipment & software" - $120,058

General Part-town for "computer equipment & software" - $40,536

Under Local Finance Law, a five (5) year PPU allows the town board to BAN without permissive referendum; meaning that the taxpayers have no ability to question or stop the borrowings unless the items are being bonded in violation of law. Advertising bonding resolutions of five (5) years or less with no permissive referendum and then extending the payments for 23 years is deceitful if not illegal.

In short, the town board bonded for less than $370,000 of software and equipment that will more than likely no longer be in use or usable by the time the bond debt is fully paid in 2042.

There is an option that could possibly shorten the pay-back time for all the serial bonds should the next town supervisor choose to do it. Currently, the bonds have a "call date" of March 1, 2027 meaning that the town is obligated to use the current payment schedule until March 1, 2027.

On that date, the town may have some decisions to make. They can:
Continue paying per the present schedule (March 2042) at about $505,000 per year for all the bonds; or,

if the interest rates drop below the 3.00% now being paid, they could go back to rebid the remaining principal of about $6.4 million looking to get a better interest rate on the remaining debt; or,

they could pay down some additional principal when they re-bid the bond in 2027 and instead bond for a lesser total dollar of principal.
My questions, which the supervisor has yet to answer because I apparently have told him that "it's against town law" too many times and I am now on the "B" list of town residents
...Did the town board realize that these 5-year BANs would become a serial bond that wouldn't be paid back in full until possibly 2042?

...Is the Highway Superintendent's budget so tight that he couldn't find an extra $10,200 for tools and equipment?

. ... Did the town board know that highway garage tools; computer equipment and the software that will probably not even be relevant in 2027 let along 2042 was not really going to be paid back until 2042?

...Were there financial decisions being made among town board members behind closed doors or did the supervisor make all the decisions alone while leading the taxpayers down the "primrose garden path"?
The bond resolutions that were unanimously adopted without questions being asked (and probably without even being read) by the town board actually gave the supervisor 'carte blanche' authority to sell the bonds using any method available under the law.

And, Miscione did just that without any discussion at the board table in view of the public!