$23.8M Drew Forest deal nears finish line as Madison secures more funding
Madison Eagle, Sept. 30 By Joe Murray
MADISON — Madison is moving closer to completing its $23.8 million purchase of the Drew Forest, with borough officials outlining a funding plan that could ultimately bring the cost to local taxpayers below $7 million.
The Borough Council approved two additional financial measures Monday, Sept. 28, as officials work toward closing on the property following more than five years of preservation efforts.
The purchase would protect approximately 47 acres of Drew University property, including mature woodland and glacial ponds. The forest also serves as a recharge area for the Buried Valley Aquifer, an important regional groundwater resource.
Madison has already secured more than $10 million in county and federal funding toward the purchase. The council's latest action includes approval of an additional $1.692 million grant agreement involving the U.S. Fish and Wildlife Service and the New Jersey Highlands Water Protection and Planning Council.
Additional state funding is also expected, including approximately $4.7 million through the Green Acres program over the coming years. If the anticipated grants are received, borough officials estimate Madison's share of the purchase will be less than $7 million.
Because some of that funding will arrive after the anticipated closing, Madison plans to use short-term borrowing to complete the transaction.
Councilman Eric Range, chairman of the Finance Committee, said the borough recently sought an updated credit rating to help secure favorable borrowing terms.
"The borough asked for an updated rating so we could get the lowest possible interest rates when we borrow the funds to purchase the Drew Forest," Range said.
Standard & Poor's reaffirmed Madison's AAA credit rating, while also giving its planned short-term borrowing the highest available rating.
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The council also authorized Madison's municipal electric utility to temporarily lend the borough up to $3 million at a 3% annual interest rate. The one-month arrangement is intended to reduce borrowing expenses while the borough awaits incoming grant payments.
"It is not something we typically do, but it is permitted and is the most fiscally prudent approach for that particular transaction," Range said.
Although a closing date has not been finalized, Range indicated that the purchase could be completed relatively soon.
"We hope to close on the Drew Forest in the next six weeks or so, but we'll only execute the bond purchase when we are fully confident that closing is imminent," he said.
The latest developments follow several earlier steps toward preserving the property, including the council's adoption of a bond ordinance in July and Planning Board approval of a subdivision needed to separate the forest from other Drew University land.
During public comment, Madison resident Judy Kroll, co-chair of the Friends of the Drew Forest, praised borough officials for continuing to identify funding opportunities throughout the lengthy preservation effort.
Kroll thanked council members for "being diligent and resourceful in looking at ways to fund the purchase of the forest."
She also encouraged residents to take advantage of the changing season and visit the property.
"If anybody is interested in visiting the forest, this is a beautiful time of year with the fall colors and the trees are starting to drop leaves, which makes wildlife observation a little easier," Kroll said.