Northumberland to take $1.5 million TAN
March 24, 2010
Northumberland — The selectmen announced at last Monday night's meeting that the town will be going through with acquiring a $1.5 million tax anticipation note (TAN) to keep the town from bankruptcy this year.
The options of which bank to use was whittled down from four to two. Of the two, the selectman chose Woodsville Guaranty Savings Bank because they had the lowest interest rate of 1.75 percent and offered the $1.5 million credit. The second choice of Passumpsic Savings Bank offered only $1 million and had an interest rate of 1.87 percent.
According to Selectman Jim Tierney the amount will cover the town's costs as well as provide a couple hundred thousand dollars in cushion, as about one-quarter of a million dollars will be owed to the School District, and about three-quarter of a million dollars is needed to cover payroll as well as other costs.
As of last Monday the town had an outstanding balance of $585,902. This is $301,218 in unpaid taxes, $30,227 for sewer bills and $35,421 all for 2009. There is still $41,000 due from 2007 and $174,000 unpaid from 2008, according to Mr. Tierney.
"On a line of credit we don't start paying anything until we start taking money out," said Mr. Tierney, "If I took out the entire amount tomorrow it would cost us about $17,500."
Also discussed at the meeting was that the town does not have enough money for the new town truck that was approved on the warrant. The medium duty dump truck was Article 20 on the town warrant that was expected to cost $91,250 over a five year period. The quote that the town received was on a truck with an older motor. That truck has been sold and the cost of what is now available with a new motor would cost at least an additional $6,000, noted Mr. Tierney.
Additionally it was announced that the grants the town applied for to fund sidewalk repair, improvement to the town hall building and improvements to the school buildings were not awarded.