Q: How much is this really going to cost?
A: According to the Board of Selectmen's own model, the total financial commitment for the ratepayers of the Town of Hingham will exceed $259 million which is more than a quarter of a billion dollars. This is arguably one of the largest purchases ever considered by a town in the history of the Commonwealth of Massachusetts and is more than all of Hingham's other capital projects combined.
Q: Would our rates go up under town ownership?
A: Yes. The Board of Selectmen presented a financial model that does not adequately account for investment in infrastructure. In order to properly maintain the water system, the Town of Hingham will need to invest more which means your rates will be higher. In addition, the Board of Selectmen has not yet received a single binding offer from a contract operator, so they had to estimate that cost. If they are off by 10%, it would mean an increase of $20M. The peer reviewer identified $90 million in errors, and without seeing the updated model, which the Town has not released or even SEEN, the concern is that there likely may be more.
Q: What would happen to other capital projects, like Foster School?
A: Due to the amount of time, money and effort that has already been expended to pursue the purchase of the water company, it would appear that other urgent capital projects - like schools, fire stations, the senior center, library, rec center, Town Hall, etc. - have already been crowded out. Even without factoring in the water company, all of these projects combined would extend the Town of Hingham dangerously close to its maximum borrowing capacity.
Q: Would buying the water company impact Hingham's AAA bond rating?
A: It could. So why risk it? The Town has proposed using General Obligation bonds which are backed by the full faith and credit of the taxpayers of Hingham. Also, it is unclear how the bond markets would respond to Hingham ratepayers acquiring debt in order to purchase and maintain assets in Hull and Cohasset. Other risks include unsubstantiated costs due to no binding contract with a contract operator,
Q: Wouldn't we be protected by an enterprise fund?
A: Any revenue shortfalls not covered by the enterprise fund would be the responsibility of Hingham taxpayers. For example, taxpayer dollars are regularly used to make up the difference when the South Shore Country Club fees don't cover their costs.