The Cambridge Community Fire and EMS Commission needs to hire a financial advisor as it moves toward five possible, simultaneous 2021 referendums to expand its fire and EMS station, the Cambridge Village Board says.
The Village Board voted unanimously on June 23 to ask that in a letter to the commission.
Village board members and village staff expressed deep frustration over a plan to mail out letters in July to taxpayers in all five municipalities served by the Cambridge-area fire and EMS, that will list what a property owner might tentatively pay in a referendum, per $100,000 of assessed value, based on their municipalities’ share of the total station expansion cost.
The lastest estimates put the total project cost at up to $6.5 million. Each municipality would pay a portion of that based on their equalized value.
Cambridge Village Administrator Lisa Moen told the board on June 23 that village staff members don’t feel prepared to calculate the village figure accurately.
Moen said a financial advisor would be best able to calculate the tax rates per $100,000 for each of the five municipalities, based on the same parameters, so that they are consistent are accurate.
Moen told the Village Board that she suggested in a recent email to Oakland Town Chairman Eugene Kapsner, who chairs the fire and EMS commission, that “the commission does its due diligence, to have a financial advisor take a look at these varying factors and provide a number that we calculate for residents across all the municipalities.”
In mid-June, Kapsner indicated in email correspondence with Moen, reviewed by the News & Independent, that all of the other municipalities have responded with their tentative calculations. Municipalities represented on the fire and EMS commission are Cambridge, Rockdale and the towns of Oakland, Christiana and Lake Mills.
Moen told the Cambridge Village Board on June 23 that she has not fulfilled Kapsner’s request because village staff “don’t feel comfortable trying to calculate those numbers.”
Plans presented in April would roughly triple the size of the current, 35-year-old station, from 9,800 to 25,700 square feet, spreading out on to an adjacent site that now holds a Pizza Pit restaurant and a small house. In cooperation with the other four municipalities represented on the Fire and EMS Commission, the Town of Christiana bought the Pizza Pit property in 2019.
In April, at the request of the commission’s station expansion committee, Kaukauna design-build firm Keller Inc., brought a list of about $500,000 in possible cuts that would have brought the total project in at about $5.75 million. Kapsner said at the time this would met his goal to keep the total cost under $6 million. But committee members decided on May 28 to go with the project as proposed, at about $6.25 million. More recent conversation has set the maximum cost at $6.5 million.
Cambridge Village Board members and village staff, meeting by teleconference as they have since April due to COVID-19, said on June 23 they disagree with how other municipalities represented have come up with their requested figure per $100,000 of assessed value.
Moen said she particularly objects to a suggestion that a 12.5 percent across-the-board cost reduction be built into the per-$100,000 formula, to account for state’s lottery credit.
The lottery credit isn’t available to businesses and to others including the owners of second homes, she said.
“We cannot just take blanket 12.5 percent off for what a taxpayer would owe,” Moen said.
Moen further said the request from Kapsner appeared based on an assumption that the five communities, that jointly provide fire and EMS service under an intergovernmental agreement that dates to the 1950s, with annual contributions based on their equalized values, would take out one joint loan for the total cost of up to $6.5 million.
That’s not realistic, Moen said.
“The loans should be separate for each municipality,” Moen said.
She also said the village could independently borrow for its portion of the project cost, outside state levy limits. But if one of the five communities took out a loan for the entire cost, and other communities made payments to them to cover their portions of that, the village’s portion by state law would have to come out of its general fund budget. And the general fund budget is subject to levy limits, Moen said.
Moen said before she could caluclate a cost per $100,000 for Cambridge taxpayers, the village would also have to know the term of the loan, the interest rate and which year assessed property values would be based on.
In her email correspondence with Kapsner, reviewed by the News & Independent, Moen raised the idea of hiring a financial advisor on June 19, the week before the June 23 village board meeting.
In a June 19 email, which Kapsner, Oakland Town Clerk Chris Astrella, Cambridge Deputy Village Administrator Barbara Goeckner and Cambridge Village President Mark McNally were all copied on, Moen included a lengthy list of the financial information she said the village would need to set an accurate cost per $100,000 for its taxpayers.
Moen wrote that a financial advisor would also have knowledge of the impact of the economy, which has taken a downturn in recent months due to COVID-19, with its future course uncertain.
“We do not want to be presenting numbers to the residents unless we are confident they are accurate,” Moen wrote.
Kapsner, in an email response, referenced a recent phone call attended by several officials from municipalities represented on the commission. He said in that phone call, that was not noticed as a public meeting, Astrella provided an estimate of what the interest would be on a loan and the loan term.
Kapsner further wrote in his June 19 email that the cost per $100,000 that the fire and EMS commission would like to include in letters mailed out this summer to all propety owners served b yCambridge-area fire and EMS, would only be a tentative estimate.
It would be “only an estimate and for information only, in an information letter to residents so they have an idea of the impact to each of them,” Kapsner wrote. “We are not interested at this time to spend a bunch of money that we don’t have for a financial advisor to do the estimate we can do ourselves.”
He said the figures per $100,000 for each municipality would be firmed up later this fall, if the commission elects to proceed toward the five referendums in April 2021.
“I have the four other municipalities’ numbers and if you want the letter to go out without your numbers we could do that. I’m not sure how the Cambridge residents would view that but it’s your call,” Kapsner continued. “I had asked for this information several weeks ago and now just before we’re putting this letter together, THIS.”
Kapsner did not respond to the newspaper’s request for copies of the responses from the other municipalities, showing their submitted estimates per $100,000.
In a subsequent email to Kapsner on June 22, Moen wrote that due to the apparent impass, the issue “would probably come up in President McNally’s discussion regarding the Fire Commission tomorrow.”
A timeline set by the Fire and EMS Commission at a May 28 meeting at the Christiana Town Hall included sending mailings to area residents and letters to municipalities in July. Community meetings are envisioned in the fall.
The committee on May 28 also said it would finalize the total project cost by the end of June, and by the end of June would release a firm impact per $100,000 of a local homeowner’s property value.
In recent months, a range of impacts per $100,000 have been discussed at committee meetings and shared publicly.
Keller, Inc. suggested at an April meeting of the stastion expansion committee, that the impact for the owner of a $100,000 home might be near $90 per year in all five municipalities,
Subsequently, in a release in mid-May, Cambridge Fire Chief Terry Johnson said new analysis suggested that a $5.75 million expansion project would in fact likely cost the owner of a $100,000 home just $44 per year for 20 years.
If total project costs come in higher than that, that analysis further suggested that the owner of a $100,000 home would pay $46 per year for a $6 million station expansion and $48 per year for a $6.25 million station expansion.