Oak Park’s village trustees opened an essential conversation last week on the subject of how to use and when to use municipal debt. For the village government there are two fairly immediate needs.
Our streets and alleys continue, inevitably, to decay. Under the current pay-as-you-go model of fixing a few streets and alleys each year, the village will never catch up to the potholes and the buckling. The village has a clear idea of the ranking of failing roadways and a ballpark number of $20 million is being tossed out for an aggressive repair program.
Economic development is obviously a priority and, inevitably, the village is again going to be a participant in funding some of the major projects. The high-rise project, soon to break ground at Lake and Forest, for instance, works because the village will demolish its obsolete parking garage on the site and must pay to build new. The Colt project is predicated on taxpayers adding a new north-south street, sewers, sidewalks, lighting and another new parking garage. Going back, those projects might have been funded from the Downtown TIF. But the TIF is largely dead, its funds either invested or squandered, depending on your point of view.
But the village needs a new source of cash for both economic development investments and a major street overhaul. Long-term bonds are an option that may well be appropriate. The logic of taking on debt to be repaid over, say, 20 years is that these are long-term improvements that ought to be paid by today’s taxpayers and also by taxpayers 15 years out.
This is why we are supportive of OPRF using debt to pay for a new (reasonably priced) swimming pool rather than just draining the school’s vast cash reserve. It is why taxpayers widely supported a notable tax hike for the park district to fund the major upgrades we continue to see roll out and which will be repaid over time.
The difference here is that OPRF and the parks have the financial strength to take on more debt because they have methods of repaying the principal and interest. The village government has made progress toward stabilizing its finances but will still need to find funding from taxpayers to allow it to take on notable debt.
The conversation has started. That’s good. It needs to be open and forthright.