CHESTERFIELD, Va. (WRIC) — As Chesterfield residents go to the ballot box this November, they’ll be asked to answer a $540 million question — should the county issue a slate of bonds for new schools, parks and public safety buildings?
That’s because the county has opted to hold a bond referendum in November, hoping to get public approval for the debt — which will in turn allow the county to pay extremely low interest rates.
“We want to be in touch with the people on this particular topic,” said Dr. Joe Casey, County Administrator.
The county wouldn’t borrow the full $540 million at once, instead receiving authorization to do so when planned projects are set into motion over the next ten years.
Matt Harris, Deputy County Administrator for finance, said they chose a public referendum because it was the most cost effective option — a general obligation bond, or GO bond.
“It’s the lowest-cost way we can access debt financing,” he said. “We can only access that special kind of financing if it’s approved by the voters in a referendum.”
He added that if this option passes, the debt service could be paid with existing taxes, because debt service is already worked in to the budget.
“There are no new taxes associated with that,” he said.
The County held its last bond referendum 9 years ago, in the shadow of the great recession, but county officials say those debts – and others from 2004 – are now being substantially paid down, opening up an opportunity for the county to take on more debt.
“We’ve had a lot of growth in the last ten years, and there are things, frankly, that we didn’t get done in 2013,” said Dr. Casey.
In the wake of the great recession, Chesterfield faced severe budgetary constraints, because the county relies primarily on property taxes for revenue. As the question of whether the U.S. is in another recession looms, county officials said the county is now less reliant on property taxes than it was in 2009.
“That’s something we’re going to have to remain attentive to,” Harris added.
He also noted that the county has already completed the vast majority of projects funded under the 2013 referendum, saying they attained a “clean bill of health” on that front.
In 2013, the County authorized $451 million in bonds. Adjusted for inflation, that would be about $573 million today, meaning the county is proposing a slightly smaller debt load this time around.
Voters in Chesterfield will see the bond question on their ballot this November. A ‘Yes’ vote will be in favor of allowing the bonds, while a ‘No’ vote would oppose them.