EDITORIAL: Limit obligations to specific projects | Opinion


So the county is essentially asking residents of Spotsylvania to borrow $ 398,704,983 – which taxpayers will be required to pay back to the penny, including interest – without guaranteeing them that the money will be used for the very specific purposes indicated on the ballot. vote, except for the $ 58. million aquatic center.

The county has an AAA rating, so the bonds could be sold at a favorable interest rate, but borrowing money always has a downside.

According to Realtor.com, the median price of a home in Spotsylvania County last month was around $ 370,000. So a typical homeowner’s property tax bill could go up from $ 407 (after taking into account the repayment of previous bond issues still in progress) to $ 777 per year for the next eight years, and more for homes over. dear.

Like home equity loans, which use owners’ equity as collateral, general obligation bonds use a jurisdiction’s ability to raise taxes to reassure investors that debt will be paid off on time with interest.

So investors get a guaranteed return, but with the exception of the aquatic center, taxpayers are not guaranteed that their higher taxes will be used exactly as described in the referendum questions.

It’s worse than handing a blank check to the supervisory board, which at least limits their spending on taxing money already collected. It’s accepting a legal obligation to repay nearly $ 400 million that the county wants to borrow, even if it later decides to use its “flexibility” to replace the specific capital improvement projects outlined in the referendum with something else.

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