The town will likely not have to draw upon a line of credit the Board of Selectmen authorized in anticipation of an end-of-year funding shortage.

“‘I’m 99 percent sure that we’re not going to need to borrow at this point in time,” said finance director Jane Savastano. “We were just being extra cautious.”

The funding issues arose from the timing of property tax billings and payments. Savastano said spring is a particularly tough time for the town financially, as it comes between the December billing and the July billing.

Also contributing to the low point in funding were a $1.5 million sewer project for Dawn and Marsh streets, taken out of the town’s sewer fund last year, and $750,000 to offset the tax rate for this year.

At Town Meeting in March, several million dollars in projects, including about $2 million in road bonds, were voted into the town’s expenditures.

The $4 million tax anticipation note approved by both the Budget Committee and the Board of Selectmen would prevent the town from falling behind on its bills before the next tax billing in December, Savastano said.

Board of Selectmen Chairman Elizabeth Roth said the board approved the note a couple of weeks ago at a meeting.

“It’s pretty much an insurance policy with cash flow,” said Roth. “What’s coming in might not meet obligations. It’s just like a regular business line of credit.”

While the line of credit has been opened through Citizen’s Bank at an interest rate of 2.55 percent, the town would not start paying interest until it is forced to take funds out of it, and it doesn’t look like the town is going to have to do that, Savastano said, adding the town’s funds are in a positive balance right now.

Tax collector Cheryl-Ann Bolouk is monitoring the tax payment situation daily. Currently, the town is getting about $2,000 to $3,000 per day in tax payments, Savastano said.

When more tax payments, particularly from commercial properties, come in later in June, the town should be in good shape, she said.

“It’s good that we have it in place, we’ve got some big projects coming up,” said Savastano. “It’s a nice feeling that we can meet our obligations.”

Salem has not had to borrow money to pay its bills since 1999, a luxury that caused people to become concerned with the possibility of having to borrow resurfaced this past fall.

“We were just very fortunate in the last eight years that the money stayed in the reserves, sewer and water essentially,” Savastano said. “We used reserves for sewer and water projects. If we didn’t use reserves for that, water and sewer rates would have dramatically increased.”

Prior to the eight-year stint without having to take out a tax anticipation note, which is the only way the town can incur debt without a townwide vote, Salem frequently took out similar lines of credit, Savastano said, adding that most towns have to do it at some point to bridge the gap between tax collections.

“We used to borrow all the time. We budgeted money in the budget for (tax anticipation note) interest,” Savastano said.