"I support this project, but think it should be delayed for a few years until the economy recovers."This would seem to be a reasonable, but to further delay action will be costly.
Why? ... Because we have a rare opportunity as a community to build a new library for a small fraction of its usual cost due to a unique confluence of factors:
1. Historically low interest rates. Just as if you were buying a new house, the City will borrow the capital to fund this construction and repay it over time. (Because Madison is so fiscally conservative, it plans to pay this "mortgage" back in only 10 years.) Interest rates on municipal debt are now lower than they've been since Lyndon Johnson was in the White House.
These rates are not expected to remain this low for long.
2. Federal subsidy is currently available under the New Markets Tax Credit program that is expected to range from $6 - 8 million. The City funding commitment is only $17 million - out of a total budget cost of $37 million.
The New Markets Tax Credit program is currently set to expire after 2010.
3. Construction prices are currently depressed. The estimated cost to build the library is $6 million lower today than it was one year ago. However, material costs are already beginning to move upward.
In short, there has never been - nor may ever be - a better opportunity in our lifetimes to make this much needed investment in the Madison Public Library system.
The Mayor's office has estimated that the cost on the average Madison home will average $17 per year starting in 2011. And when the debt is paid off after 10 years, the City will continue to enjoy new tax revenues from the redevelopment of Block 66 for decades to come thereafter.
This investment is worth it. And we owe it to future generations to act wisely now.