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As of December 31, 2024, the value of the lease liability was $8,738. The Town is required to make annual principal and interest payments on the equipment ranging from $1,931 to $2,834. The leases have imputed interest rates of 3.5%. The value of the right-to-use lease assets as of the end of the current fiscal year was $22,380 and had accumulated amortization of $14,090. The future principal and interest payments as of December 31, 2024, were as follows: Fiscal Year Ending December 31, Principal Interest Total 2025 4,523 242 4,765 2026 3,260 87 3,347 2027 955 10 965 Total $ 8,738 $ 339 $ 9,077 10. RISK MANAGEMENT The Town is exposed to various risks of loss related to damage and destruction of assets, vehicle liability, and injuries to employees, health insurance and unemployment insurance. These risks are covered by commercial insurance purchased from independent third parties. There have not been any significant changes in any type of insurance coverage from the prior year, nor have there been any settlements which have exceeded commercial insurance coverage in the past three fiscal years. The Town purchases insurance for: general property and liability, municipal crime, automobile, public officials liability, law enforcement liability, contractor’s protective liability, excess catastrophe liability, inland marine, electronic equipment, and ground pollution relating to fuel storage tanks. General property is insured at a full replacement cost agreed upon at $12,504,805. A Builder’s Risk endorsement was added in the amount of $450,000 on the North Boston Pavilion. General liability insurance is limited to $1 million per occurrence, with a general aggregate $3 million limit. General liability has an add on rider for network security loss with an annual aggregate of $250,000. Municipal crime coverage ranges from $25,000 to $400,000 per occurrence. Automobile insurance is limited to $1 million per accident. Public Officials Liability, Law Enforcement Liability, and Contractor’s Protective Liability are all limited to $1 million per occurrence and $2 million in the aggregate. Excess catastrophe liability is limited to $3 million per occurrence and $6 million in the aggregate. Inland marine has various limits for each individually scheduled property and equipment with a total largest individual limit of $1.57 million. Fuel storage tanks have a ground pollution liability of $1 million. A Cyber Policy was added with limits from $50,000 to $1 million per occurrence. 11. SHORT-TERM DEBT Liabilities for Bond Anticipation Notes (“BANs”) are generally accounted for in the Capital Projects Fund. State law requires that BANs issued for capital purposes be converted to long-term obligations within five years after the original issue date. However, BANs issued for assessable improvement projects may be renewed for period’s equivalent to the life of the permanent financing, provided that annual reductions of principal are made. - 38 -