If the town borrows $10 million (for example) to build a community center, Lincoln homeowners can expect a property tax increase of $290–$309 per year, or a hike of 1.7–1.8%, according to the Finance Committee.
In a September 18 presentation (14-minute video with slides here; just slides here), FinCom chair Andy Payne outlined what the town can afford to borrow and how various borrowing levels would affect taxes. Current cost estimates for a community center range from $13.73 million to $24.0 million depending on which design option voters approve.
In fiscal 2023, the median tax bill was $17,488 on a median home value of $1,259,900.
The FinCom figures assume a 30-year fixed bond purchased in early 2025 at an interest rate of 4.0–4.5% (the current municipal rate is 3.94%). Payne noted that some of the debt stabilization fund (currently $5.5 million) could be used to reduce the amount needed to borrow.
Under the statutory debt limit, the town can borrow up to $40.7 million in addition to its existing debt. By another measure — maximum annual debt service — the borrowing ceiling is about $30 million, he said. Because the annual debt payments (as with fixed-rate home mortgage payments) remain the same for the entire 30-year term of the bond, debt service declines over time as a percentage of the entire town budget, which grows each year due to inflation.
“No one is arguing that we should run up to our debt limit or even close to it — this is just showing the lay of the land,” Payne said.
Other large capital projects on the horizon — though with great uncertainty as to cost and timing — include a road repair project (about $10 million in five to seven years), purchase of more land for the town cemetery (seven figures in about 10 years), a ladder truck for the Fire Department (about $1.5 million in about 10 years), and a new DPW facility in 10-15 years for $15–$20 million.
“This is absolutely the most debated and controversial slide in the entire presentation. There are items on this list that will never happen and other items not on this list that will come into play,” Payne said. “The point is that FinCom and the Capital Planning Committee and town staff are very mindful of the town’s other possible capital needs.”
The Community Center Building Committee will meet on Wednesday, Sept. 27 at 7 p.m. to finalize its presentation at the September 30 State of the Town meeting (Zoom link here).
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