Seekonk's Backdoor Override

Allow me to set the stage.

In December of 1999 the town of Seekonk passed a debt exclusion to cover the cost of two construction projects. One project was for Seekonk High School. The other was for the Martin Elementary School. The grand total of these two projects was somewhere around the 22 million dollar mark.

Now fast forward to June 2006. Seekonk residendts failed to pass a proposition 2 ½ override that would have increased to property tax limit to cover the cost of funding the North Elementary School. The result of the failed override attempt meant that North School was shut down, and multiple teachers we laid-off.

Fast forward again to November of 2006. The Town Of Seekonk mysteriously discovers that it has a budget surplus of about 1.2 million dollars. Some argued that this meant that North School did not need to shut down, and that the town leadership jumped the gun, or had used nothing more than scare tactics. That suggestion is debatable, however this money did allow for a lot of teachers and previously cut programs within the Seekonk School Department to be reinstated.

So where did this money come from?

Sometime in 2006 the Town of Seekonk began getting payments from two grants that were issued to cover 70 percent of the cost of these two projects. The amount? You guessed it! A little over 1.2 million dollars, a yearly payment that will be paid until 2023/2024. The payment schedule is as follows:

Martin School Construction Project:

Payment Schedule:

2006 to 2008: $403,518.00 per year.

2009 to 2024: $436,957.00 per year. (actually drops a dollar a year for the last 5 years)

Grand Total: $8,201,861.00


Seekonk High School Project:

Payment Schedule:

2006 to 2008: $852,951.00

2009 to 2023: $854,726.00 (payments drop one dollar for last 5 years)

Grand Total: $15,379,737.00

In FY09 Seekonk will owe a total of $1,802,673.75 on the loan. The town will receive at total of $1,238,262.00 in grant money bringing the Net Debt down to $564,412.00.

Now you would think that the Levy Limit on the debt exclusion would only need to cover the Net Debt. Think again, I have confirmed through the Seekonks Finance Director that the taxpayers are charged for the Total (Gross) amount that is owed and the 1.2 million dollars in grant money is counted as revenue for the town.

Three Things:

First, the taxpayers are being screwed, and this will also tie into my third point.

Second, the Town of Seekonk is supplementing its budget with money that is going to stop coming in 2023 and 2024. This means that in 2025 the Town will automatically be 1.2 million dollars in the hole. But what does the current leadership care? They will be long gone by then and it will be someone else’s problem.

Finally, most of these projects that require debt exclusions are pitched to us as the amount they propose are the highest it will be. The Senior Center is a prime example. The committee that is overseeing that project has said that the $44.00 per year, per household, is the max amount because they are seeking grants and other forms of funding. I’m not saying they are being dishonest because they do not set the tax policy, the town leadership does. But based on what I have just written, do you think we should believe any official when they say that grant money will take a chunk of the cost away? It may take a chunk of the cost off of the project, but it is certainly not going to lessen the money coming out of the tax payers pockets.

I know Seekonk is hurting for cash. But this is dishonest when the taxpayers are lead to believe that our leaders are only going to tax us what they need to. It is also a foolish to count a temporary payment as revenue. It’s not revenue and 1.2 million dollars is a large deficit to make up for any town, in any time period. At the very least this money should be put into a rainy day fund, or a stabilization fund. Think about, if the town had sucked it up for one year and not bought new fire trucks and police cars, or the long list of “capital items” that were purchased; we could have banked that money and paid cash for a new senior center.