Sandwich Seeks to Fund Operating Budget Without New Canal Plant Funds

SANDWICH – A new revenue source in Sandwich will bring the town an additional $3.5 million this year, but town officials are trying to develop an operating budget without using the funds.

A payment in lieu of taxes agreement begins with the owners of the Canal Power Plant after the completion of a new natural gas turbine generation facility.

The town struck the agreement with NRG Energy a few years ago. The agreement will continue with Stonepeak Infrastructure Investments, which recently purchased the power plant facility.

“The goal is to not use that money on any recurring expenses and possible look at it to increase some of our reserves which are lower than other towns who don’t budget as closely as we do,” said Town Manager Bud Dunham.

Another use for the funds would be on larger on-time capital expenses or the normal capital budget.

“There are always constant needs there between the school and town departments,” Dunham said.

The PILOT agreement for Canal Unit 3 runs for 21 years.

Current plans call for an operating budget around $83 million. Dunham’s recommendation is due to be presented to the Board of Selectmen by the end of the month.

Dunham said the town also hopes to be able to continue to fund eight firefighter positions. The town received a two-year federal grant to hire the firefighters, which expires next month.

“That’s a huge goal as well, to try to retain those eight people without using an override or the NRG money,” Dunham said. “I know I’ll be able to make that happen.”

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