Revenue From New Residences Must Be Used to Cover Operating Costs Associated With Providing Services
March 10, 2022
And thank you, Gof, for your reply to my response…
You’ve waxed eloquent about the trees in my letter, but mentioned nary a word regarding the forest. So let’s try again, shall we?
We agree with your assessment that “There is an imperative to use the money the (donor) citizens have put in the till.” That should have happened long ago. In its 01/06/2013 “Library Building Project Update,” the Library Board set forth both a fundraising goal ($1.25 million) and a timeline for achieving said goal (June, 2012 through Spring of 2013).
In that document, the Library Board also identified a 14,800 square foot building concept, complete with underground parking, and a $2.3 million price tag. The $1.25 million in proposed donations was to be supplemented with the existing $1.05 million Village commitment.
However, the 05/31/2013 Community Foundation of Southern Wisconsin (“CFSW”) fundraising report informed us that only $733,000 had been raised by that Spring 2013 deadline, of which $23,000 was paid in fees to CFSW.
A wise man once told me that “the perfect is the enemy of the good.” I agreed with him then and I agree with him now. At that moment in time, the net $710,000 of funds raised should have been combined with the Village commitment to proceed with the project. That amount should’ve been sufficient for a 10,000 square foot facility without underground parking – far better than what we had then, or anything that is possible now.
But the dice were rolled by that past Library Board, holding out for the perfect. The dice showed snake-eyes, and now you’re suggesting that the Village dig deeper to negate that bad bet. On that we disagree.
The same wise man also once pointed out to me that the major expense of any new building isn’t found in its construction but in its operation and maintenance over an expected lifespan of half a century or more. There, too, we agree.
You’ve mentioned (citing Valle Telle) that “there is a significant increase in both electric, water and tax revenue coming on stream,” but suggested that utility profits be used to fund library operations. You know as well as anyone – and better than most – that revenue isn’t profit. The revenue from a dozen new, energy-efficient residences cannot be channeled to library operations – it must be used to cover the operating costs associated with providing the services it pays for.
Finally, you’ve suggested that “With interest rates at this level and inflation the highest in 40 years” now is a good time to double down on the Village’s borrowing commitment for the library. However, we’ve been assured by the current presidential administration that this rampant inflation is “transitory,” and we both know the Fed will begin acting next week to rein it in. How? By raising interest rates, of course. There will be substantial lead time on the USDA loan avenue you want New Glarus to travel down, and by the time the barn doors are closed the cows won’t even be in the same county.
Gof, you have previously suggested that the current Library Board should take action with the resources on hand. We agree. But we disagree on your call for a dramatic increase in municipal borrowing, and on the inappropriate diversion of New Glarus Utilities’ modest profits, to satiate the increased budgetary demands of a new library facility.
Village of New Glarus