JAY — Selectmen voted unanimously Monday not to award a bid for a $1 million road improvement bond.
The board sought bids on interest rates on the proposed loan to try to catch up on paving roads and other related improvements.
Selectmen had discussed seeking a $1 million bond a couple of years ago but voted down the idea.
This time, the town solicited bids on the interest for a 10-year bond.
Selectmen opened seven envelopes containing five bids on interest and two letters from banks that elected not to bid.
The bids ranged from Gorham Savings Bank for 3 to 3.5 percent, plus $40,000 in fees, to Camden National Bank for 4.35 percent over the 10 years.
The board discussed going with Androscoggin Bank’s bid of 3.86 percent due to the bank being local, the minimal 0.2 percent difference from the lowest bid, and the relationship the town has with the bank.
“We have a relationship with the bank and it kind of evens it out because they help us with our investments,” Town Manager Ruth Cushman said.
“And you’re keeping it local,” Selectman Tom Goding said.
Androscoggin’s proposal would have required the town to pay $138,705 for the first year and $103,860 for the last year.
When Cushman told the board it needed to choose a lending institution before the question went to voters, Selectman Tim DeMillo said, as he had voiced previously, he likes doing it the way the town does now — avoiding borrowing.
Currently the voters decide each year if they want to raise a certain amount for paving. Last year, they agreed to raise $350,000 and this year, they will be asked to raise $450,000 on Tuesday, June 14.
Cushman said the town would pay back $1.38 million over the life of the bond.
Selectman Tom Goding said he was in favor of putting more money in the budget for paving rather than borrowing.
Some selectmen voiced concern about the voters not passing the $450,000 in the proposed budget and spending the money to pave roads now that they would still be paying for a decade. Plus, by the time they finished paying, it would be time to do the roads again, they said.
“If it doesn’t pass at $450,000, the voters don’t want a $1 million bond,” Selectman Amy Gould said. “Right now we’re using cash instead of a credit card.”
After more discussion that included the audience, selectmen decided not to pursue the issue further.