The town has sold bonds worth $8,489,000 in the second portion of borrowing to fund the school project. The sale generated a 2.6% interest rate with annual debt service at roughly $440,000, according to Lincoln Finance Director Colleen Wilkins.
Prior to the sale, the town’s AAA credit rating was affirmed by Standard & Poor, which helped keep interest rates low. “As part of their report, S&P cited strong credit rating factors for the town, including Lincoln’s very strong economy, very strong management with strong financial policies and practices, and the town’s thoughtful practice of building financial reserves,” Wilkins said.
The tax impact on the median tax bill is $215 and will be reflected in real estate tax bills issued in fall 2022.
In the first round of borrowing in early 2019, the town sold bonds worth $80 million at an interest rate of 3.379%. At that time, the Finance Committee was basing property tax impact estimates for the project on an expected interest rate of 4–5%, resulting an estimated tax hike of 18–20%, but officials revised that down to 14–16%.
The combined bond sales plus $4.4 million from the town’s debt stabilization fund and $1 million from free cash in 2019 are funding the $92.9 million project , which is scheduled for completion this summer. For fiscal year 2023, the Finance Committee projects in the Annual Town Meeting warrant that debt service for the school project will be $4.29 million, or 9.6% of the $44.52 million town budget.