HANOVER TOWNSHIP — Voters in Whippany Fire District 2 approved a referendum on Saturday, August 10 to finish the construction of the new firehouse located on Troy Hills Road.
The voters approved “construction of a firehouse for an amount not exceeding $6,100,000.00 and undertake the issuance of bonds relative to the project.”
The Fire Company and Fire District commissioners worked tirelessly to make this happen and have overcome several unforeseen obstacles which prevented them from completing the project in a timely manner.
As part of the referendum the Fire District has an opportunity to replace their current $3 million variable rate construction loan with a low-interest fixed rate loan administered by the Morris County Improvement Authority. They also need to borrow additional funds to help finish the remaining work on the new firehouse which is estimated to be $2.8 million.
Once the old firehouse is sold – it is under contract – and the loan specifications are finalized, the actual amount borrowed should drop to about $4.9 million. Interest costs and risks will also be reduced due to the lower, fixed rate. Of the $4.9 million borrowed, $3 million will be used to pay off the existing variable rate loan. The remaining $1.9 million plus proceeds from the sale of the old firehouse will go toward completion of the new firehouse.
The request to borrow up to $6.1 million provides a margin for safety should the old firehouse sale not close in a timely manner. Should that happen, all proceeds from the sale would go straight to paying down the loan. Ultimately, Fire District No. 2 intends to only borrow an additional $1.9 million. So, what does this mean to Whippany Fire District No. 2 taxpayers? The Morris County Improvement Authority has estimated that at $4.9 million in bonding – $1.9 million more than the district’s current debt – the average Fire District No. 2 homeowner would pay about $12 annually in additional fire taxes. In the unlikely event that the full $6.1 million in bonding is utilized, the increase would equate to around $17 per year.