Special meeting focuses on how Kennett Square Borough will finance project with library06/06/2017 02:31PM ● By Steven Hoffman
Kennett Square Borough Council held a special meeting on Tuesday, May 30 to discuss the joint project with the Kennett Library that would result in the construction of a facility that would serve as a new library, a new administration building, and a new headquarters for the borough’s police department.
“This is a meeting for public discussion,” council president Dan Maffei explained at the onset of the meeting. Maffei emphasized that there would be no action items on the agenda—the purpose of the meeting was simply to have a discussion about the proposed project and to receive a presentation from the borough’s Finance Committee on how Kennett Square Borough's portion of the project might be paid for.
Before the Finance Committee presentation, attendees had the opportunity to make public comments.
Albert McCarthy, a borough resident and the former police chief, said, “This is a really sensitive issue considering the cost. I think the library needs to be improved, but not at a cost of $10 million.”
McCarthy also expressed concerns about costs for a new administration building and police station, and offered several suggestions of other potential sites in town. He said that there are some residents in Kennett Square including senior citizens on a fixed-income, who can't afford a heavier tax burden.
“We need to decide if this is a want or a need,” McCarthy said.
Clara Saxton, who serves on the borough’s Historic Architectural Review Board (HARB), asked if the project will be presented to the HARB before it is approved.
Next, borough manager Joseph Scalise outlined some basic details about the project. He noted that the Kennett Community Center Visioning Study was presented to the public at an April 25 meeting. The Visioning Study included details about the concept for the design of the building and the estimated costs for the project. The project would include a borough hall, a police station, a 300-seat auditorium that officials said could best be described as flexible space, and a parking structure for approximately 45 spaces.
Borough council is in support of the new library being built on the borough-owned Weinstein lot at the intersection of State and Willow streets, Scalise noted, but it must be determined to what extent the borough will be involved with the project. Scalise explained that the Finance Committee analyzed three different options: first, the borough participates fully in the project as it was described in the study; second, the borough decides to participate in the project, but only builds the minimum necessary to move the borough hall and police station into the building; and, third, the borough decides not to participate in the project at all, but the library still constructs their facility on the Weinstein lot.
The Finance Committee analyzed the “all-in” option and determined that it would cost about $6.5 million in construction and soft costs, $500,000 in soft costs, and another $250,000 in soft costs before construction. For this option, it would cost the borough $386,000 per year for 25 years to repay the costs of the project. That’s assuming a 3.565 percent interest rate. The borough could bring in about $1.4 million on the sale of assets to help offset some of the costs of the project.
The second option, meanwhile, would cost about $5 million in construction and soft costs, $400,000 in soft costs, with $150,000 in soft costs required prior to construction. This option would cost the borough about $293,000 annually to make the debt service payments. However, the borough was asked by library officials not to consider this as an option in advance of the June 5 borough council meeting because the library would not be able to move forward with the project, as it was described in the visioning study, unless the borough fully participates. The costs of the parking structure and the flexible space would be too much for the library to do on its own.
If the borough opted not to participate in the project at all, it would cost about $300,000 over the next three to five years for the necessary maintenance to continue to operate the existing borough hall and police station. Again, if the borough ultimately chooses to opt out of the project, the library would need to reevaluate the entire plan to determine if the Weinstein lot, with its limitations, was still a viable option.
Scalise and council member Geoff Bosley, who serves on the borough's Finance Committee, talked about some of the benefits of doing the project with the library. There is considerable cost savings for both the borough and the library because they will be sharing some of the costs on the preliminary work that will be necessary before construction begins. Additionally, because it is a cooperative effort with two public entities, the project has much more potential for grants. Scalise said that they are optimistic that as much as $4 million to $5 million might be available in grants, including funding from the Department of Community and Economic Development.
“I think this is a terrific concept,” said Bosley. He noted that in the current administration building, they can't even hold public meetings because of a lack of space. The police facilities are not where they should be, either, Bosley said, and there have been discussions about a new library for more than 20 years.
“Our buildings are out-dated and expensive to run,” he explained.
Bosley envisioned the combined administration building and library as a true community center.
“On the day it opens, it will become the most important building in town,” Bosley said, explaining that it would serve the community's needs for 50 to 75 years.
Scalise said that the borough is in a good financial position to undertake a project like this now, because Kennett Square has managed to reduce its debt from about $26 million to about $9 million since 2000.
Bosley said that the borough should be able to add the debt service payments into the annual budget without needing to make dramatic cuts to existing services.
“We're not going to need to raise taxes in order to do it. We're not going to take police officers off the street in order to do it,” Bosley said. “This is not going to be an insurmountable challenge.”
Council member Wayne Braffman said that he's not sure that council can be certain that taxes won't increase at some point in the future because revenues that might have been spent on something else are instead being used to pay the debt service on the proposed facility. Braffman indicated that the borough should thoroughly explore the option of participating in the project, but perhaps not including the extra space for meetings or for the parking structure as part of the borough's involvement.
Council member Jamie Mallon said that borough officials would need to be careful with budgeting to make sure that the costs of the project don't go up.
“It's incumbent upon us to manage this project well,” Mallon said.
Council member Ethan Cramer, who said that he hasn't made up his mind about the borough's participation in the project yet, pointed out that in 20 years people will be looking back on the decision and deciding whether it was the correct one or not.
“We could fail to take advantage of an incredible opportunity, but we could also put ourselves in a financial position that we don't want to be in. We have a fiduciary responsibility to do this right,” Cramer said.
Council member LaToya Myers picked up on some of the concerns expressed by residents about the potential costs of the project. She noted that there are people in the community who are struggling, and might not be able to stay in their homes if taxes increase.
Mayor Matthew Fetick praised the current library board for making more progress on the effort to get Kennett Square a new library than has probably been made at any point in the last 20 years. He also talked about the need to keep the library in the borough where it needed most by residents who depend on its resources the most.
Fetick said that if the borough can afford to add a facility that will be the home of the administration building, the police station, and the library, and can do so without raising taxes, it would be the responsible thing for the elected officials to do.
“If we can do it within the existing revenues, it would be irresponsible not to do it, Fetick said. “I think it's a win for everybody—it's a win for the library, it's a win for the community. We could have a phenomenal facility within our budget.”