The following summarizes our current understanding of the Glen Alpin costs and funding estimates.
Costs. To date, The Township has authorized a total expenditure of $1,850,000 for items including plan development, architectural fees, project manager’s salary, septic design, and asbestos removal and on the roof and HVAC replacements. Based on the information available, a summary breakdown of Glen Alpin’s actual and projected costs is as follows:
|
Purchase |
Property price.
|
$1,400,000 |
|
House Renovation |
According to the feasibility study, Watson & Henry estimate the costs (in 2004 dollars) to complete the Glen Alpin renovation phases 1 through 4 (but not including 5) to be approximately $2,981,000. The estimate has since been revised upwards and includes the architect’s fees of $432,000. The Township may not implement all renovation phases.
|
$3,400,000 |
|
Grounds and Landscaping |
The Township has a landscape plan but does not have a finalized budget until Phase 2 costs are better determined. In the 2006 Township budget, the Township forecasted a future cost of $500,000 to complete the landscaping.
|
$500,000 |
|
Operating Costs |
Operating costs depend on the property use and include the cost of utilities, grounds and buildings maintenance, property management, insurance etc. The Township has not yet released an estimate for the expected operating costs.
|
TBD |
|
Debt Service |
Municipal debt will be issued by the Township to pay for Glen Alpin renovation expenses not covered by other sources. The amount issued, repayment terms, and interest cost have not yet been determined. The Township expects debt interest expenses to be approximately $63,000 for 2006.
|
TBD |
|
Implicit Costs |
The Township will use the Department of Public Works (DPW) for Glen Alpin related work; this is an implicit but real cost of the project and should be separately identified. Glen Alpin will not pay property taxes, which is an implicit cost of public ownership. |
TBD |
In total, the Glen Alpin purchase and renovation cost will be at least a $5,400,000 project - not including operating and debt financing costs. According to the Township, the estimated cost for the Glen Alpin rehabilitation, if implemented as proposed by the architects, totals $4,000,000, which includes $800,500 for Phase 1 (the roof project), a conceptual budget for phases 2, 3 and 4 of $2,426,273, a conceptual budget for long-term projects of $510,000, and other costs of $290,000. We do not yet know if this estimate includes landscaping costs or what is included in the long-term projects and other costs.
Funding. The Township has stated that its goal is to have Glen Alpin self-funded. The Township is referring to Glen Alpin’s operating costs, as it has also estimated that 30% to 40% of the renovation costs will be funded by grants and donations.
The Township has been applying for federal, state, and county grants to assist funding Glen Alpin and appears to be successful in this. In 2005, the Township raised $290,000 in grants and donations. In 2006, the Township has applied to the Morris County Historic Trust Fund for approximately $350,000 to help fund Phase 2 of the renovation. In June, the Township will apply for a NJ State Historic Preservation Trust grant where grants of up to $750,000 may be awarded. The Glen Alpin Conservancy, a private charitable organization with 300 members, has been formed to assist with fundraising.
The Township currently plans to use the Harding Open Space Trust Fund (HOST) to pay for Glen Alpin debt interest costs. HOST receives its funding from the Harding Open Space Tax[1]. The 2005 revenue from the Harding Open Space tax was approximately $780,000. A maximum of 10% of HOST revenues may be used to pay for historic preservation initiatives. Glen Alpin expenditures paid for by the Town will come either directly from HOST, general tax revenues, or from municipal debt proceeds issued by the Township. A summary of Glen Alpin’s funding known to us follows:
|
Purchase |
Township Open Space Trust Fund. |
$175,000 |
|
|
Other contributors
|
$1,225,000 |
|
House Renovation & Landscaping |
2005 grants and donations including: $50,000 awarded from the New Jersey Historic Trust to help pay for a preservation plan. This includes work to plan the roof replacement, assessment of interior artifacts, and archaeological management planning. $223,000 from the Morris County Historic Preservation Trust Fund to fund the roof, gutter, and downspout replacement. $5,000 and $2,500 from the New Vernon and Morristown Garden Clubs respectively, to fund a landscape plan. $18,000 from the Glen Alpin Conservancy.
|
$300,000 |
|
Rental Income |
The Glen Alpin Steering Committee has developed revenue estimates for various scenarios according to the planned use of the property as described above. The Township’s goal is to have the rental income cover the operating and some of the debt service costs. The Township has not yet released such revenue estimates. Another option is to protect the Glen Alpin house from the weather and leave it vacant, which would not allow for any public use and would not produce any revenue.
|
TBD |
|
Debt |
Other expenditures not paid for with Open Space Funds, grants, or donations will be funded by municipal debt. The Township has authorized the issuance of a $1,850,000 bond, the proceeds of which will be used to pay for the roof renovation, architectural fees, HVAC replacement, etc. Debt service[2] will be paid with Open Space funds grants, donations, and Town tax revenues. |
$1,850,000+ |
Most of the funding (85%) to date is from the Township, County, and State. Morris County has either funded or committed nearly $800,000 and the State has contributed $500,000. Glen Alpin has not yet received any Federal funding.
[1] Both Harding Township and Morris County have open space taxes that are .04% and .05% of property value respectively. Both tax rates were approved by voter referendum and together make up over 10% of the Harding property tax rate.
[2] Debt service on $1,850,000 is about $170,000 annually if paid down evenly over 15 years at 4.5%.
