It’s time to give an update on the progress of the Monterey Library building project. Our application for a Construction Grant was filed January 26 as required, and we are awaiting word of our ranking by the Massachusetts Board of Library Commissioners, which we will receive in July. That announcement will let us know when we will receive our estimated grant of $1,917,459, which is a considerable portion of the total $3,056,840.. These grants are never partially funded. While the final number may differ by a few dollars, it will add up to just under two thirds of the allowable cost . We know we will need to raise $1,102,324. Our matching funds can come from multiple sources. We are grateful to the Friends of the Monterey Library who spent over $20,000 to help with the Planning and Design grant and have already raised almost $40,000 for our new and improved library. We are working with Dennis Lynch, Monterey’s grant writer, on a grant from the federal government. We will continue to fundraise and search out grants but we are a long way from what we need to match the state money.
In order for the state money to be guaranteed we need to guarantee our share. This construction program has been around for over thirty years and been very successful. The Mason Library in Great Barrington is a great example of what can be done. The MBLC, who administer the grant, have advised us that the most efficient and economical way to manage the whole financial project is to have the town approve borrowing for the total amount. While the bulk of the costs for this project will be incurred during the actual physical construction which will be in years two and three, grant payments are disbursed by a strict formula of equal increments over a period of five fiscal years with each payment requiring achievement of set milestones. The loan balance will be in constant flux with draw downs being made to cover project costs as needed and yearly state grant disbursements as well as payments made by the town being applied to the outstanding balance. Interest expense is based on the outstanding borrowed amount, not the total approved amount. We do not forsee ever having to borrow the entire amount. However, the MBLC requires that we have the full amount available to us, and after all these years of running this successful program they know what works best. An approval in May of the warrant request to borrow the full estimated cost of construction will verify the town’s commitment to the project and will ensure that we can hit the ground running as soon as we receive a positive notification in July.
The first phase of the project is to finalize the design based on what the town approved in an earlier town meeting vote and apply for the permits necessary to start. There will also be a period of putting the project out to bid according to state regulation. This could take the better part of a year. If the town has approved borrowing the money in the upcoming May town meeting, and we are fortunate enough to be ranked high in the July announcement, we can finalize the grant contract and start that process. If we do not vote on this at town meeting in May and have to wait until the next annual meeting to get local approval, we will be behind in this process a whole year. We don’t know for sure, but construction costs don’t usually go down so the longer we spend in this process the more likely it will be more expensive. The grant value is based on the construction estimate presented this past January, it does not increase.
We are working on an article for the annual town meeting that will accomplish this. It will be complex to satisfy the legal requirements of borrowing three million dollars, and also to protect the town. There will be three conditions.
· The first is that the money will not be borrowed if the state does not sign the contract to give us their share. The state has already approved their bond to fund this grant round and is looking to give out this money. We hope the grant reviewers will look on our project favorably and rank us high.
· The second condition would be that the amount of money borrowed could be reduced by using donations and other grants as they are raised and awarded. If a federal grant comes through, and the Friends of the Monterey Library continue to raise money, we will lower the amount the town puts in. We will continue to search out grants and other avenues of raising money to lessen the burden on the tax payer.
· The third condition on the article will be that it would need to pass an exclusion vote on Proposition 2 ½. This will be important since the town budget should not be constrained or controlled by this project. By passing the library article there will be protection for the town through these conditions.
This clearly is a complex article and there will be much discussion. It is impossible to predict interest rates, and we won’t know those rates until we complete the loan process and use the money. There are various ways to build into the loan that the state grant money will come in five years while the town money will likely be through a fifteen year borrowing plan. There may be one loan to cover the state money and one for the town’s portion. The bank that Monterey works with is researching how best to do this. We hope to have some basic answers to these questions by the town meeting vote. This is one of the largest authorizations the Town of Monterey will have ever voted on at town meeting, and we want everyone to understand it. The state library grant is a wonderful opportunity to update our library, making it accessible and safe for the entire community, and to provide more services than ever. We want to give you time to understand what we are proposing and also time to ask questions and let us know your concerns. We have been in close discussion with the Selectboard and the Finance Committee. We are also having an open house at the library on Saturday April 22 from 10:30-12noon so that you may come in and see the design plan again and ask questions about the finances. We also invite questions at any time. The Library Trustees now have their own email address, firstname.lastname@example.org, but you can also email the library directly at email@example.com. Check out thelibrary website for the plans and frequently asked questions. Or simply stop in and ask anytime.
Throughout this process we have sought out what the people who live in Monterey want, and we have presented you with a library design that answers the needs of the town. We have been working on the best way to fund this project and are presenting you with a plan that will minimize the impact on the tax rate. We thank you for your support thus far in allowing us to apply for the state grant and approving the design. Now we ask that you support the town’s financial commitment at the annual town meeting in May to help see this dream become a reality.