Introducing The Reader

I like to read. And to write. I believe there is a need for a combination of news and analysis on what’s going on in Berkshire County and the great beyond. My background is in the public, private, and nonprofits sectors. I’d welcome your thoughts and contributions to this endeavor.

Give The Reader a read. I’d love to hear from you: your feedback, story ideas, your own thoughts for publication.

Thanks for taking a moment and allowing me to share my thoughts.

Patrick White
Editor and Publisher

 High School Building Project

MMRHS: By the Numbers

by Patrick White

I have attended a number of presentations related to the Monument Mountain Regional High School Building Project, including the discussion between the Finance Committees of Berkshire Hills Regional School District and the Town of Stockbridge. Here is an analysis that provides a fairly solid prediction of how this project would impact taxes in the three district towns.

In a few minutes, you can gain answers to these five questions:

1. Why this matters: The decision affects property taxes, the local economy, and quality of education quality in the community.
2. Tax implications: This analysis explains how this bond will be structured and its impact on property taxes.
3. Benefits of a new school: The project proposes a vast improvement on the existing building and includes a new vocational school to address workforce shortages and provide practical career paths for students.
4. Opportunities to offset costs: New growth will offset at least some of the anticipated tax increase.
5. Why a decision is needed ASAP: Accelerating the decision mitigates the risk of higher interest rates and corresponding higher property taxes.

Introduction and Assumptions

Renovation of the existing structure, rather than replacing it, seems the least preferable option. Renovation will void the $53 million state contribution, so it actually costs more than a new building.

The new building options result in a net local cost of around $112 million for the preferred option. That sounds—and is—a great deal of money. Once you run the numbers, it is a bit less scary. Note the costs may go up with greener heating options.

While the project cost is significantly higher, that's in today's dollars. Cumulative inflation since the first vote is 29.4%. This means in real dollars, this price tag hasn't risen nearly as much as the face value comparison. Put another way, when comparing apples to apples, the local cost of the new school is $78.4 million in 2014 dollars.

Second, the current proposal includes a significant improvement: the addition of a robust vocational high school whose cost is estimated at $20 million. Approximately 50% of high school graduates in South County either do not attend or do not finish college. There is also a significant shortage of folks working in the local trades. With its significant investment in vocational offerings, this proposal is far better than the original one.

Who Pays What for a New MMRHS?

The 2017 capital agreement uses equalized values to calculate each town's share. In other words, it is aggregate property values, not enrollment, that determines the obligation of each town in the district for the cost of the new high school. The 2024 preliminary equalized values are as follows:

Equalized values in dollars, 2024 (preliminary)

Great Barrington: $2.202 billion
Stockbridge $1,311 billion
West Stockbridge $0.656 billion

Equalized values as a percentage for each town in the district:

Great Barrington: 52.8%
Stockbridge: 31.4%
West Stockbridge: 15.7%

Annual bond payments per town calculation

EQV percentages at the time of bonding determines how much of the total cost each town will pay. There are a number of bond parameters that will determine the impact on taxes, including bond type, interest rate, and term. For This example, I am using assuming a 30 year term, the currently-available bond interest rate of 3.5% for a level payment over the term. The bond market is incredibly complex and the district's advisors may elect for a different structure than I have indicated. Therefore, these numbers are for discussion purposes only.

Picking up the tab. Borrowing responsibility per town:

Total Bond: $112,000,000
Great Barrington: $59,159,710
Stockbridge: $35,212,557
West Stockbridge $17,627,7333

Paying it back. Annual bond payments per town at current rate of 3.5% over 30 years.

Great Barrington: $3,239,481
Stockbridge: $1,928,177
West Stockbridge $965,264

Impact on Taxes

Resulting budget increase. Next, we look at the total amount raised this year through property taxes in each town:

Great Barrington: $30 million currently/$33.25 million with annual debt service/tax increase of 10.8%

Stockbridge: $9.6 million currently/$11.5 million with annual debt service/tax increase of 20.1%

West Stockbridge: $5.8 million currently/$6.8 million with annual debt service/tax increase of 16.7%

Samples for individual tax burden at currently-available bond rate of 3.5%. Rates may change by the time the bond is complete.

Great Barrington
Assessed Value Examples	Current Tax Bill	New Tax Bill	Percentage Increase	Increase in Dollars
$350,000	$4,827	$5,349	10.8%	$523
$550,000	$7,585	$8,406	10.8%	$821
$750,000	$10,343	$11,463	10.8%	$1,120
$950,000	$13,101	$14,519	10.8%	$1,419
Stockbridge
Assessed Value Examples	Current Tax Bill	New Tax Bill	Percentage Increase	Increase in Dollars
$350,000	$2,482	$2,979	20.1%	$498
$550,000	$3,900	$4,682	20.1%	$782
$750,000	$5,318	$6,385	20.1%	$1,067
$950,000	$6,736	$8,087	20.1%	$1,352
West Stockbridge
Assessed Value Examples	Current Tax Bill	New Tax Bill	Percentage Increase	Increase in Dollars
$350,000	$3,353	$3,911	16.7%	$558
$550,000	$5,269	$6,146	16.7%	$877
$750,000	$7,185	$8,381	16.7%	$1,196
$950,000	$9,101	$10,616	16.7%	$1,515

 

Note that these numbers are incredibly sensitive to small shifts in interest rates. For example, if interest rates were to drop by 1 percentage point, the tax increase would drop by 12.5%. Were interest rates to rise by 1 percentage point, the tax increase would rise by 13.4%.

New Growth Will Reduce the Impact

New Growth comes in several forms. If someone tears down a small house and builds a bigger one, the new assessed value of the home goes up. New, larger projects such as a commercial or private residential development at Simon's Rock in Great Barrington or 37 Interlaken and/or Elm Court in Stockbridge could also result in a significant offsetting impact. Developments that include a hotel component have a positive impact on your taxes in two ways: property taxes and the local share of the occupancy tax, where the maximum 6% is collected by both Great Barrington and Stockbridge. This isn't an argument for or against any special permits or land use decisions; rather this is just a fiscal analysis. The sweet spots for new growth of course are examples where there isn't an offsetting need for new municipal expansion, for example new water and/or sewer lines financed at the Towns' expense.

Operating Cost Impact

What is yet unclear is whether the annual operating cost of the new high school will be less or more than the current operating cost. For example, will a more energy efficient building reduce the cost of heating and cooling? Will the new vocational offerings increase operating costs?

Interest Rate Risk

Experts tell me that if this bond were offered today, the interest rate we could expect is approximately 3.5%. This may seem low, but remember, municipal bonds are tax exempt and in high demand. Note, however, that this rate follows larger trends in US interest rates, namely the Fed interest rate, which currently stands at 4.5% to 4.75%. If you search for predictions, you will find a likelihood that we will see a decrease in the Fed rate of 0.5% to 1% over the next one to two years, which might result in a significantly lower cost (see the first column examples above). However, a number of President-Elect Trump's proposed policies could increase inflation, specifically by disrupting the global supply chain and by imposing tariffs. The Fed increases interest rates to combat inflation, so we could see rate increases depending upon administration policies. I am not in the business of predicting interest rates, so this analysis is simply an exercise in risk mitigation.

Recommendation: Accelerate the Decision

If in the short term, the Fed lowers rates a 1/4 to 1/2 point, my strong suggestion is that we lock in these rates as soon as possible. I recognize the current plan is to have a vote in October; I would suggest, if at all possible, bring the vote to Town Meetings in May. By locking in a lower rate and bonding the project immediately if it passes, our towns can mitigate risk of higher interest rates and a significantly higher burden on the taxpayers.

Other Options?

In some corners, there is talk of the smaller towns withdrawing from the district. This is unlikely to transpire. The Commonwealth makes it nearly impossible to do so. All districts, including ours, are comprised of municipalities that have entered into "forever agreements." To disband Berkshire Hills Regional School District, all three towns would need to vote for the break-up. If this were put before the district's voters, the success would be highly unlikely. For 60 years, we've been one district and we will continue to be one.

The basic question before the voters will be: do we vote for the high school and bite the tax bullet, or do we vote against it and squander the $53 million in state support for this project. If the voters vote this down, they will be faced with massive renovation costs of the current building. In fact, the net impact on taxes of those renovations may be more burdensome than the new high school when you subtract the state's $53 million that is only available for a new building.

Should the voters choose to support this project, rest assured that we will continue to identify ways to keep the Town's budget, and therefore your tax burden, in check.

Patrick White is a member of the Stockbridge Select Board

 Town and Tribe

Historic Stockbridge Mohican Commission Launches

By Patrick White

November 25th marked the inaugural meeting of the Stockbridge Mohican Commission. The Commission includes three appointees of the Stockbridge-Munsee Band of Mohicans and three of the Town of Stockbridge. Shannon Holsey, The Tribe’s President, Bonney Hartley, and Sherry White are representing the Tribe. Patrick White, Rich Bradway, and Rick Wilcox are representing the Town of Stockbridge.

The purpose of the Commission is to foster reconciliation via practical initiatives and common ground. For example, the first meeting focused on efforts to create a new Revolutionary War monument in Stockbridge that will honor both Mohican and settler Continental Army volunteers from the 18th century. The project has broad support among the Town’s Memorial Day Committee, Parks and Recreation Department, Select Board, and the Tribe.

Other topics discussed including the vision of the Commission and placement of the new Wa’thatinik Housatonic River Crossing signs.

Stockbridge was founded as Indian Town in the 1730s. Its original Board of Selectmen included two tribal representatives on the three-person board. Dozens of Mohicans volunteered during the American Revolution and over a dozen lost their lives in a single battle in New York during the War.

 Creative Thinking

Egremont Tackles the Affordable Housing Crisis

By Patrick White

Egremont has embarked on a multi-pronged strategy to increase its supply of affordable housing. Here's a rundown.

It adopted the state's Community Preservation option at 3%, which makes it eligible for the highest level of state matching funds. It eliminated property taxes on homes or the portions of homes that are offered for rent with long-term affordable leases. It also plans to take a town property and build four units, two for home ownership and two rental units offered as income properties by these new homeowners.

This model is especially intriguing, as it eliminates the property management fee for each of the rental properties. The adjacent homeowner would own the attached rental unit, collect and keep the rents, and be responsible for property management. Seems like a great micro-housing model to me. It also seems like a model the state's regulators should get behind. Quickly.

Taken together, Egremont is using CPC to kickstart funding for affordable housing, and then augmenting these public funds with market incentives designed to empower private-sector individuals to help the town solve its affordability crisis. What's great about this strategy: the town is focused both on what it takes to build the housing and a creative model to manage the properties once built and occupied.

Nice work.

 Transparency

Controversy Over Informational Meetings

By Patrick White

Unlike larger towns like Lenox and Great Barrington, small towns like Stockbridge lack a staff position for a town planner. In the infrequent instances when a property owner requests clarification or other information, our town administrator in conjunction with a representative of the select and/or planning board fill this role.

A number of you have shared with me concerns raised by a Lenox resident and shared widely on social media forums, critical of the Town's procedures. Let me explain the difference here between an informational meeting, where no decisions are made, and a quorum of the select board, which in with this bylaw conducts a public hearing to decide if and under what conditions the special permit may proceed.

Over the past year, both the owners of Elm Court and the owners of 37 Interlaken/DeSisto reached out to the Town of Stockbridge and asked for informational meetings. At the time of the requests, Chuck Cardillo was chair of the Select Board and he asked me to attend those meetings with Town Administrator Michael Canales. The two Elm Court meetings were also attended by the chair of the Planning Board.

I disclosed these meetings to the Lenox resident, and asked Michael Canales to explain to him our process in Stockbridge when developers ask for information meetings. Michael wrote the following:

Thank you for your follow-up email regarding public engagement and transparency in Stockbridge. I appreciate your commitment to fostering open communication between our communities.

As mentioned in our previous response, Stockbridge approaches developer engagement differently from neighboring towns due to our smaller size and the absence of dedicated planning or community development departments. To clarify:

• Initial discussions with developers are purely informational and serve to help the town understand the scope of a proposal before it enters the formal permitting process.
• These preliminary conversations are not decision-making forums. Any project that moves forward must undergo a rigorous public review process, including hearings and opportunities for community input, in full compliance with open meeting laws.
• If informal meetings involve a Select Board member, only one member participates to ensure legal compliance, and all formal deliberations take place publicly.

Stockbridge is committed to transparency and ensuring public participation during the formal review process, where community input is vital to shaping decisions.

Thank you for raising these concerns, and we look forward to continuing to strengthen communication between our communities.

Anyway, this explanation didn't seem to sway the resident, who voiced his concerns with Stockbridge for not having a professional planner. And Lenox for not budgeting municipal funds to build a sidewalk in front of his house when the current project (and associated funding) was delayed. Look I don't write our procedures. My task is to understand and follow them. When the chair of my board asks me if I can attend a meeting, if I can I will. Sorry if that somehow displeases some folks out there.

37 Interlaken/Desisto submitted its special permit application on November 25, 2024. It is available for the public to review in Town Hall. As of this writing, no superseding application has been submitted by the owners of Elm Court. Rest assured, I will do my job and follow the law with regard to the evaluation of these special permit applications.

Join Us in Helping Our Neighbors!

For nearly 300 years, we've been celebrating Christmas in Stockbridge. Throughout these centuries, the holidays remind us that small acts of kindness nurture the soul of the individual and the character of a people. Why are we doing this gift drive? Well, it's like this. If money is tight for a family, I want the kids to still get presents. For our senior and community housing residents, most of them are single. I want everyone to get at least one gift to unwrap.

I asked three people and got four folks who've given $600! (My sister and I are in for $200 each!) So, we are 20% of the way there. If you can spare $50 or $100, we can brighten a whole lot of our neighbors' holidays, at least a little bit.

Thank you. And remember to hug the ones you love.