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Selectmen to hold worksesssion on Town Hall Oct, 27

Details of private sale-leaseback proposal released

It was the moment the Adjutants have been waiting for. On Tuesday, Oct. 25, Jeff Adjutant, a Marine sergeant who fought in the Vietnam War, proudly and happily raised the United States flag up the new flagpole that he and his wife Sue donated to the town to replace the one in front of Town Hall. His son, daughter-in-law and three grandchildren were on hand for the occasion, joined by town officials (l-r): front row, Town Manager Dave Owen, Tammy Beaulieu and Sarah, Kaitlyn and Kyle, Selectman Linda Murray and Marie Watson of Wolfeboro Public Works; back row, Tony, Sue and Jeff Adjutant (waiting to raise the flag to the top). (Elissa Paquette photo) (click for larger version)
October 27, 2011
Wolfeboro selectmen will hold a worksession today, Thursday, Oct. 27, to review and discuss options for Brewster Memorial Hall.

The special session will begin at 6:30 p.m. at the Town Hall meeting room.

At the meeting selectmen will review two proposals submitted by Public Facilities Investment Corporation in a revised letter dated Oct. 17 written by PFIC President Jeffrey Tamkin. PFIC is a private nonprofit development corporation with access to low-rate tax-exempt funding sources. Its Web site claims to have completed "over 200 public and private projects in 96 cities in 36 states."

Under the terms of either proposal PFIC would undertake the financing and construction management of the renovation and in return the town would commit to a lease for 15, 20, 25 or 30 years. "Title to project reverts to the Lessee for $1.00 at the end of the lease term and/or payoff of financing."

With minor differences, the interest rates assumed in both proposals vary by the term of the lease: 3.82 percent for 15 years; 4.36 percent for 20 years; 4.45 percent for 25 years; and 4.61 percent for 30 years.

The first proposal is to do the complete $4 million renovation proposal submitted to voters last March, using Northeast Collaborative Architects and Conneston Construction Inc. (CCI). In place of CCI the letter says "we can present independent contractors who have extensive experience in renovating similar facilities."

In addition to the $4 million construction cost, the first proposal includes $200,000 as a Developer Fee, $100,000 for Program Management, $150,000 for the Cost of Issuance, $23,119 for "Underwriter's Discount," and $195,232 for Construction Interest. There is also a "Debt Service Reserve" (apparently a security escrow) of $324,225 that can be applied to the last month of the lease. The final total to be financed, adding these additional charges, would be $4,992,576.

The town would pay this cost through annual lease payments, with the annual amount decreasing with longer lease periods. For a lease of 15 years, the annual cost would be $429,516; for 20 years, $362,076; for 25 years, $316,433; and for 30 years, $291,745. Translated to monthly payments, that works out to $35,793 a month for 15 years and $24,312 a month for 30 years.

The second PFIC proposal is to do the first floor and Annex renovation estimated at $2.8 million. In addition to the construction cost, the second proposal includes $150,000 for Program Management, $150,000 for the Cost of Issuance, $17,288 for "Underwriter's Discount," and $146,028 for Construction Interest. The "Debt Service Reserve" on this second proposal is $241,906. The final total to be financed, adding these additional charges, would be $3,505,222.

Town Manager Dave Owen stated in an e-mail that included this updated proposal letter that "I do not plan on recommending PFIC's proposals on either option to the BOS." In his view PFIC offered an opportunity to explore private sector financing for the renovation. The town could secure its own bonding for similar terms and save the middleman costs built into both proposals.

The worksession will also allow selectmen to discuss other options, including the phasing proposals made earlier by Northeast Collaborative Architects.

Salmon Press
Martin Lord Osman
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