MEXICO – Selectmen voted 4-0 Wednesday night to borrow $300,000 in anticipation of taxes, to run the town.
Town Manager John Madigan explained that a deficit would exist until October when the first payments on taxes are due, if selectmen hadn’t approved borrowing the money from Key Bank.
He said the board was authorized to take up to $300,000 to run the town in anticipation of taxes from July 1, 2005, through June 30, 2006.
Mexico is in the process of increasing its undesignated fund balance so such loans won’t be needed.
Madigan said the town has $240,000 in reserve funds “that we’re not going to use.”
The loan is to also cover a $54,246 prepayment to Woodstock Oil for No. 2 oil and diesel fuel.
Madigan said the money must be paid by Monday, July 25, for the town to secure a price of $1.50 per gallon for heating oil and $1.69 a gallon for on-road diesel fuel.
“I don’t think you’re going to get it any cheaper,” he said.
The payment is based on a usage estimate of 22,000 gallons of No. 2 oil, which is to cost $33,858, and $20,388 of diesel fuel, Madigan said.
Selectmen also voted 4-0 to lock in the prices of heating oil and diesel fuel, and to make the prepayment.
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