Republican Mayor Erin Stewart is proposing $49.5 million in taxpayer borrowing to refinance existing city debt, a move that appears to be similar to previous actions by the Stewart administration that critics say lowers current city expenses but balloons indebtedness in succeeding years.
The proposal is to be considered at a special City Council meeting on Wednesday, March 23, 2022 at 6:45pm, along with other proposals, including $20 million in borrowing for a new Public Works Yard.
Stewart has come under criticism for repeatedly adding to taxpayer debt and taxpayer costs in the long term in order to reduce costs and taxes in the city budgets during her administration.
In 2017, columnist John McNamara warned that,
The Stewart administration is shifting $6 million from a scheduled payment on the city’s rising municipal debt— creating an election year windfall to avert yet another tax increase.
During consideration of city borrowing in 2020, a Stewart administration city official and city a debt consultant noted that the $70 million refinancing being considered then would balance the city’s budget by nearly $10 million in the 2020-2021 budget year and by nearly $15 million in the 2021-2022 budget year. That debt consultant said that even after approving the current $70 million proposal, it would be likely that the city would likely need to “restructure” its debt again in another three and a half years.
The largest of the string of Stewart debt refinancing plans was her 2018 $115 million debt proposal. That plan was seen as both an effort to push past borrowing Stewart had done to cover previous years’ costs into the future and giving her the authority to borrow more to cover future budgets. Both were seen as Stewart trading tough choices between budget cuts and even higher taxes during her own administration for more debt. Stewart was accused of heavy-handed tactics to pressure then-majority Council Democrats into a quick approval of her $115 million plan, and they later approved a $99 million scaled-down version of that plan.
Democrats and other observers have called Stewart’s claims of tax cuts and surpluses as misleading because they are based on a heavy use of the city’s credit card (borrowing powers) that will ultimately need to be paid for by taxpayers.
The new 2022 debt proposal says,
that the sum of $49,500,000 be appropriated for the purpose of paying, funding or refunding prior to maturity any of the City’s outstanding General Obligation Bonds … and to meet said appropriation and in lieu of a tax therefor, bonds of the City be issued … in an amount not to exceed $49,500,000 or so much thereof as may be necessary after deducting other sources of funds available therefor.
Council Resolution
The Council meeting is to be held in the Council Chamber on the second floor of City Hall at 27 West Main Street.
