New Firehouse: The Inside Story

Some have asked me, with some trepidation, how we can plan to build a whole new firehouse without worrying about a negative impact on your taxes. Here's how.

A few months ago, Town Administrator Michael Canales was reviewing with me the impact of the borrowing for the new firehouse. At a cost of $5 million, that amounts to roughly $300k per year for 20 years. The Town of Stockbridge raises around $9.5 million from property taxes per year, so one would expect a roughly 3% increase in taxes to pay for it. Ouch. Luckily, not so fast.

My first question to Michael was to pull up the debt schedule for the town. Stockbridge will retire $350k in annual debt payments in 2032. So, that retirement of debt will reduce the tax burden by a similar amount, but not until 2032.

With an expense that is slated to begin in 2027, how do we pay $300k per year for four to five fiscal years that would keep us from having to raise taxes? The answer? Free cash.

I've always hated the term "free cash" because it certainly is not free. It is either previous tax money we raised from you in excess of what we needed, or it is unforeseen income that came to the town. In this case, it is the latter, namely the settlement funds from General Electric that was paid to the town, now roughly $2 million with the interest it has earned.

It took the two of us about a minute to agree that we would recommend to the Select Board and the voters that we use this money to subsidize the payment for the new firehouse until 2032 and then use the savings in the retired debt payments to pay for the balance of the 20-year note's annual payments going forward.

This concept is known as smoothing. You try to avoid a bumpy total budget where amounts go up and down each year. It gives the taxpayer at least some predictability as to what their burden will be absent a surprise assessment change.

With our aging population (average age here is in the low 60s), fast ambulance response times are critical to keeping all of us healthy. There's just more of a need than in the typical town in Massachusetts, where the average age is 39. If you know me, you know that I am at the same time laser focused on keeping the tax burden low, especially to those who are of modest means.

That's not to say that operationally, the new firehouse won't come with additional expenses. Mostly that's in the form of salaries. Select Board member Chuck Cardillo and Michael worked hard all year to cement the plan to split those costs with West Stockbridge. Brilliant work to lower those operating costs. Which brings me to my final point on good governance: trust the people in the room. The Select Board tasked these negotiations with Chuck and Michael. Michael kept me briefed, but this was their work. It's great when a good team can split up the work and assign it in ways that play to the strengths of each member. Kudos to Chuck for a job well done.

I hope the voters of Stockbridge and West Stockbridge will support these efforts at the May Town Meetings. They are a good deal for our towns and the right move at this moment in time.

PS: Believe me, it is not lost on me the irony that the GE money will go toward making the community safer. After all, this is compensation for the dumping of one of the worst known carcinogens into a river that weaves its way throughout the town. As Bill Shein of The Berkshire Argus pointed out, GE ran ads in 1997 downplaying the cancer-causing impacts of PCBs in The Berkshire Eagle in 1997. It was gaslighting then, and it's gaslighting now. At least some good will come of this money, and I can't think of a more appropriate way to use those proceeds than to invest in keeping our community safe.