North Castle Ready to Bond for Accelerated Road Repaving Program
North Castle officials are planning to accelerate the final 24 miles of paving of town roads by drawing on most of a $10 million bond authorization that was approved last spring.
Town Administrator Kevin Hay last week recommended to the Town Board that it borrow $9 million to repave the remaining roads that have not been done since the town began the accelerated program about seven or eight years ago.
The paving would cost an estimated $7.5 million to $8 million with the likelihood of some drainage improvements and crack sealing needed in certain locations that would account for the balance of the expenditure, Hay said.
After consulting with Highway Foreman Jamie Norris, Hay explained that the work would take two or three years depending on the contractor and would also include drainage work where necessary. The paving should help to maintain the roadways’ infrastructure during the time frame, he said.
“We feel at this point, with our financial numbers and our revenue numbers looking pretty good, COVID not significantly affecting as we were concerned of when we first authorized this, we recommend moving forward with accelerating the paving program through bonding,” Hay told the board last week.
The $9 million in borrowing would result in annual payments of $700,429 over a 15-year period, he said. Over those years, the town would likely use money from its annual $950,000 road paving expenditure line in the operating budget to repay the bond. The remainder of the yearly road-paving funds would go toward ongoing maintenance, Hay said, although up to about $300,000 could be needed.
Last May, the board authorized borrowing up to $10 million but has held off taking the money to evaluate its revenues and overall fiscal situation in light of the upheaval caused by the pandemic.
With interest rates continuing to hover at or near record-low levels, it is the right time to finance key improvements, said town Director of Finance Abbas Sura. The annual payments are based on a 2 percent interest rate, which is a conservative estimate, he said.
“This is a good time to borrow money and get any capital improvements done,” Sura said. “So, I feel like it’s a good decision for us to go ahead with this.”
If the town borrowed the money and is still paying principal and debt 15 years from now, Supervisor Michael Schiliro asked how the town would fund any future repaving on roads that have already been completed in the early stages of the accelerated program. Since the start of its aggressive paving schedule, the town has repaved close to 70 miles.
Hay responded that the town could dedicate a portion of any surplus each year toward the paving line. However, with North Castle having done drainage work where needed while completing the paving, there should be less maintenance and fewer problems.
“The roads are lasting longer because we did drainage and we’re already paying attention to the crack sealing and maintenance,” Schiliro said. “We should get more years out of some roads.”
Board members were agreeable to moving forward with the program.
“I think it’s a great project, I think it’s a great idea,” said Councilman Barry Reiter. “I’ve always said that (with) quality of life, roads are key.”
Councilwoman Barbara DiGiacinto said when discussing various municipal issues with the Association of Towns recently, the issue of low borrowing rates was repeatedly raised by local officials from around the state. The general advice was to go ahead with projects if feasible.
“It was make a list of your capital improvements you’ve been putting off and do it because the bond rates are so favorable,” DiGiacinto said. “So, obviously, I support this idea and we’ve already acted on it.”
Prior to the town’s aggressive repaving, its Pavement Condition Index averaged in the low to mid 60s. Today it’s above 80, which is considered excellent for the Northeast, Schiliro said.
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