LOCAL Voices: Election 2009

Redding debt: Where we stand now

By Peg O'Donnell
Incumbent Candidate for Redding Town Treasurer

[Sept. 17, 2009] Much has been said recently about the town’s debt and what we have or don’t have. When all totaled, Redding is responsible for payments on debt of $31,379,000. When comparing Redding to other towns, town officials must be attentive and be sure that all debt is considered in order to make the comparisons valid. Here are the supporting details.

The Town of Redding had, at June 30, 2009, $11,615,000 in bonded debt in 3 bond issues. The 1991 non-callable bond interest rate is 6.3%, the 1999 non-callable bond is 5.25% and the 2005 bond is 3.8%.

The Town of Redding also has 2 short-term notes outstanding. These are known as Bond Anticipation Notes or BANs. The total of these notes is $6,355,000. One note has an interest rate of about .61% and the other has an interest rate of about 1.09%. Both of these notes mature in October 2009 and will be refinanced for 9 months, which is the maximum length of time for this type of issue. It is anticipated that the refinanced note will carry an interest rate between .5% and 1.2%. All this short-term debt has been incurred in the 4 years since the 2005 bond issue.

The town is also responsible for payment of about 52% of the Region 9 debt. Redding’s portion of that debt is $13,409,000. The Town of Redding budget includes a line item for payments to Region 9, which covers Redding’s portion of the operating expenses and debt service of Region 9. .