Etheridge shares idea for Rescue Plan funds
Published 5:59 pm Friday, April 7, 2023
AHOSKIE – A plan has been introduced to help reduce the Town of Ahoskie’s debt.
At a special called meeting held March 28, members of the Ahoskie Town Council were advised of a strategic plan developed by Town Manager Leigh Etheridge and town staff regarding the use of the ARP (American Rescue Plan) funding received by the town. Ahoskie’s share of ARP funding (aka the federal government’s COVID-19 Stimulus Package approved in 2021) is $1.5 million.
Etheridge proposed that Ahoskie’s use of those funds, with Town Council’s approval, could come during the upcoming budget year (2023-24).
“You can designate the ARP funding as a standard allowance revenue replacement,” Etheridge noted. “Revenue replacement is the use of this funding in the most recommended and allowable audit-approved use by funding first responder salaries in the 23-24 budget.”
Etheridge stressed that her recommended use of the ARP funds meets the guidelines of the U.S. Department of the Treasury.
She further explained that by using the ARP funds to pay the annual salaries of the town’s first responders (police and fire departments) it frees up $1.5 million in the General Fund of next year’s budget. In turn, the town can apply that money to its annual debt service, which results in an annual savings of approximately $122,129 over the life of those existing loans.
“We still have a very heavy debt burden,” Etheridge noted. “The recommendation being presented tonight uses the freed up General Fund tax revenue and pay down as much of the debt we can with that $1.5 million. That will also help restore our bond rating, which helps our borrowing capability in the future.”
Etheridge suggested using the ARP funds to pay-off two loans associated with building the Ahoskie Police Station: one for $824,350 (now with an annual payment of $67,789 until 2040) and another for $281,351 (annual payment of $23,136 until 2040). Another recommended pay-off is $318,958 (annual payment of $31,204 until 2035) for a truck purchased for the Ahoskie Fire Department.
“Those are three big hits to our debt; those three combined brings us the closest to the $1.5 million we have in ARP funds,” Etheridge said. “Instead of using $1.5 million for projects that we’re already seeking grant funding for, we freeing up money going forward over the next 10-to-15 years.”
With a portion of those savings, Etheridge said the Town Council could consider hiring a full-time Parks and Recreation Director, a position that has been vacant since July of 2017, or other one-time operational projects.
“It will be up to you on what to do with that $129,122 annually,” Etheridge stated.
Etheridge said she was not seeking action by the Council at last week’s meeting, but rather to allow the town’s elected leaders the opportunity to think about the proposal. She added that the recommendation will be on the agenda at the Council’s regularly scheduled meeting on April 11 for further discussion and a possible vote.