Opinion: Braintree Chamber Of Commerce Supports Debt Exclusion

BRAINTREE, MA — In a letter to the editor Mike Wilcox, the interim chair, and Kim Kroha, the incoming chair for the Braintree Chamber of Commerce, expressed support for the the proposed debt exclusion to bay for a new South Middle School on behalf of the chamber.

With respect to the debt exclusion vote being held March 28, 2020, the Board of the Braintree Chamber of Commerce supports a “yes” vote in favor of the debt exclusion because investments to upgrade and maintain safe schools structures with positive learning environments make Braintree a more desirable place to live, which ultimately draws more families to Braintree and steers customers and employees to Braintree businesses. The debt exclusion repayment plan has a more significant financial impact on Braintree businesses than its residents because it generally follows the existing split tax rate applied to real estate taxes. The Board believes that, despite the tax rate difference, approving the debt exclusion is an overall benefit to Braintree businesses and associated conversations about business growth in Braintree.

What is the debt exclusion vote about?
This ballot initiative proposes to use a debt exclusion to raise approximately $63 million dollars for school infrastructure upgrades through a special tax payment.

• Of the $63 million, the majority ($55 million) would be spent to build a new South Middle School. Under a prior agreement, the State would also contribute $30.9 million toward the new school.
• The remaining debt exclusion funds would be used for replacing roofs at several schools, increasing security measures district-wide, and conducting a feasibility study of Braintree High School. There are separate votes for all four aspects.

Why was the debt exclusion proposed?
The plan to build a new South Middle School or renovate the existing structure generated years ago, with the State inviting the Town in December 2017 to begin the process of obtaining State funds toward the project by conducting a feasibility study. As a result of that study, the State voted in September 2019 to award Braintree $30.9 million to replace South Middle School with a new structure.

The State grant requires that the Town submit a financing plan for the remaining project funds. In December 2019, former Mayor Sullivan and Mayor Kokoros submitted a joint letter requesting an extension of the plan deadline to review the Town’s budget. The prior administration had proposed repaying the loan through the Town's operating budget. The Town Auditor reviewed the feasibility of that method at the request of Mayor Kokoros and determined that it was likely not feasible and could cause reductions in other town services. Specifically, the operating budget was forecast to fun at an increasing deficit in future years if the school was funded through the budget.

Mayor Kokoros proposed the debt exclusion method of financing to protect the operating budget and associated Town services. The vote was scheduled for March 28, 2020 so that the Town could timely submit a financing plan to the State.

What will happen if voters reject the debt exclusion?
If the Town is not able to create a viable financing plan for replacement of South Middle School, it would lose the $30.9 million already allocated by the State to the project. Because of the deadlines for use of State funds, it appears unlikely the Town could move forward with the project if the debt exclusion vote regarding South Middle School does not pass. If the Town is unable to rebuild the school, it will explore other options that include redistricting (https://projects.braintreeschools.org/south-alternatives).

What will happen if the debt exclusion passes?
If the debt exclusion vote on March 28 passes, the loan repayment will be distributed across all Braintree properties based on their property valuation. The rates generally follow the different tax rates applicable to commercial and residential properties.

• Commercial properties in Braintree are taxed at a significantly higher rate than residential properties ($21.81/1000 for commercial and industrial versus $9.86/1000 for residential), which is about 2.2x more for commercial properties.
• The debt exclusion rates ($0.85/1000 for commercial and industrial versus $0.38/1000 for residential) generally align with the 2.2x increase on the commercial tax rate.
• Because the debt exclusion will follow the tax rate differential, the debt exclusion will burden commercial property owners and its tenants significantly more than residential properties.

Why does the Board support the debt exclusion?
The Board recognizes that many businesses may find it unfair for them to bear a disproportionate share of the cost to improve schools, which is a benefit most directly attributable to residences. The Board supports approval despite this disparity because of the benefits to Braintree businesses set forth below and because the disparity would have also existed in the previously proposed scenario where commercial properties fund a disproportionate share of the Town’s operating budget through the split tax rate.

The Board supports the debt exclusion for these reasons:

• Good, safe schools draw residents to Braintree. Even buyers that do not intend to have children in the schools consider better school districts to be a plus for resale value. Supporting a great school district should directly affect Braintree businesses’ customer base and employee growth and retention.
• Approval of the debt exclusion funding could lead to discussions about reconsidering the split tax rate disparity applied to commercial properties.
• A secure operating budget allows the Town to maintain its roads and sidewalks and adequately plow snow in a bad winter, which provides customers access to Braintree business.
• Discussion about alternate methods of raising funds in Town can lead to a more business-friendly environment and conversations about supporting the growth of existing and new businesses in Braintree to strengthen the operating budget.

We encourage Braintree businesses to join us in supporting a “yes” vote on March 28, 2020.

Mike Wilcox, Interim Chair, and Kim Kroha, Incoming Chair,
on behalf of the Board of the Braintree Chamber of Commerce