It’s not often that a town gets the chance to build a brand-new senior center and extensively renovate and upgrade its aging library and not see taxes go up.

But that’s exactly what Sandwich voters will be offered later this month.

Town Manager Bud Dunham and his finance team have come up with a way to fund the two projects—totaling about $20 million—using alternative sources of revenue rather than a tax increase.

These revenue sources include the 21-year agreement that has been hammered out with the owners of the canal power plant that will provide annual payments in lieu of taxes (PILOT) to the town related to the new Unit 3.

These payments are guaranteed to the town, even if the power plant is sold.

The second source of revenue comes from a change in state law that allows the town to tax short-term rentals, over and above usual hotel room taxes.

With all this money, Mr. Dunham and selectmen are confident they can more than pay for the projects without raising taxes a smidgen.

Former selectman Susan James broke down the financing in a recent guest commentary for the Enterprise.

“Fiscal Year 2023 will be the first year the payment on the loan will be due,” she wrote. “The PILOT agreement will pay the town $1,710,626. If the $250,000 short-term rental taxes are added to this, the town would have a new revenue total of $1,960,626. The first loan payment is $1,424,000, so the revenue exceeds the amount of the required payment.”

“In fact,” she continued, “for those who are concerned that the room tax revenue is estimated and not guaranteed, the guaranteed PILOT payment alone exceeds the amount required to pay the loan.”

Additionally, as the loan payments decrease each year, the revenue sources are on track to increase.

The vast majority of the finance committee and Sandwich’s Republican Town Committee are not too keen on the plan. They would much rather see these alternative sources of revenue be used to reduce residents’ taxes.

Not a bad idea, to be sure. But then what? Where does that leave the senior center and the library?

Sandwich has been given a very rare gift to cross two huge and arguably much-needed capital projects off its wish list without hitting taxpayers up for more cash. Voters should not squander this chance.

If selectmen were to pursue the projects in the traditional manner, they would have to ask voters to kick in $20 million more in taxes for the next 20 to 25 years, and that’s in today’s dollars. No one knows how much construction costs will rise by the time the town would get around to bringing the debt exclusion to a vote.

Even at $20 million, it’s a big ask, especially considering that voters recently approved funding the town’s costly wastewater initiatives and the construction of a new public safety complex in South Sandwich.

Sure, there is some risk in using alternative sources of revenue. But Mr. Dunham is as cautious as can be when it comes to Sandwich’s finances. He’s actually been criticized by the finance committees in years past for being too cautious with his calculations.

This plan—as presented in Article 1 of the October 21 Special Town Meeting warrant—has his full support. That speaks volumes to us.

It’s got our vote.

(1) comment

Dave Ambassador

I commend the Selectmen and Mr. Dunham - they have listened to the needs of their community and responded with a plan to improve our library AND build a center to support our seniors (and others) which does not increase taxes. Certainly the revenue could be used to help reduce taxes, but it is much better to provide services to keep our population satisfied and healthy than to obtain a small tax reduction.

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