If members of the Schenectady City Council were going to get cold feet on the city’s Smart Cities program, the time to do it was before millions of dollars on equipment and software were allocated, before grants were sought and before progress was made on creating a comprehensive city wi-fi network.
To give up now, even in the face of an anticipated drop in city revenue due to the Covid-19 outbreak — would be short-sighted. And a promising project designed to build a technological framework for educational opportunities for city children, public safety, healthcare, business expansion and government efficiency may be doomed forever.
City Council members are expected to decide next week on whether to authorize the issuance of $2 million in bonds for capital projects related to the Smart Cities program.
Their concerns, both about the city’s ability to make payments and for future expenses that have yet to be budgeted, are legitimate. Council members certainly don’t want to be throwing taxpayer money down a well when vital city services could be in jeopardy.
But if members of the council decide not to move forward with the bonding, or if they decide to wait a year or two before resuming the program, they could be jeopardizing the city’s finances more than helping.
First of all, the cost of borrowing right now may never be lower. If the city waits for more favorable financial conditions, and interest rates then shoot up when the economy recovers, the annual cost of borrowing the same amount of money later on could soar.
That’s not all. A year or two from now, any opportunity to tap into federal coronavirus stimulus funds for capital would be lost.
Grants, revenue from businesses planning to connect to the city’s network, any potential savings generated by greater government efficiencies, and any cost savings to homeowners for citywide wi-fi service could be lost if the project was put on hiatus.
Existing efforts to create hot spots in the city’s Hamilton Hill and Mont Pleasant neighborhoods — where access to wi-fi is especially vital as kids are forced to do more school work from home — would stop.
And as we emerge from the coronavirus outbreak, tele-medicine will become more prevalent. The city needs to be prepared with the technological capacity to handle the additional transmission of information. The city won’t be prepared if funding is cut off.
Mayor Gary McCarthy says the bonds won’t add anything to the budget in 2020, giving the city time to expense the anticipated $100,000 annual payments when city finances improve. And as the city retires other debt, it can better afford the new payments.
Council members should continue to demand transparency and justification when it comes to requests for Smart Cities money.
And they should continue to press for details about how to protect residents’ privacy as more of the technology, such as street cameras and wi-fi, comes online.
But the city has committed to this project and is counting on its potential benefits.
Cutting off funding now by not authorizing these bonds would be the wrong decision at the wrong time.