ESSEX— The board of finance Thursday set a property tax rate of 20.99 mills to fund the total $23.05 million town/schools spending package for 2014-2015 that was approved by voters at the May 12 annual budget meeting. The rate, representing $20.99 in tax for each $1,000 in assessed property value, is up by two mills from the current rate of 18.99 mills.
Much of the two mill tax hike was required to make up for revenue lost after the townwide property revaluation completed last year led to a 7.72 percent drop in the grand list of taxable property. Despite the increase, First Selectman Norman Needleman said Thursday about 80 percent of the town’s residential property owners would see only a “nominal” decrease or increase in the property tax bill they receive next month. Most, but not all, of the town’s residential properties had a drop in assessed value under the first revaluation conducted since the Great Recession began in 2008.
Finance Director Kelly Sterner presented the board with ten options for the tax rate, beginning with an “adjusted mill rate” of 20.62 mills to cover the drop in the grand list after revaluation. Sterner said the “break even mill rate,” with no planned deficit, would be 21.05 mills. She noted the finance board, in setting the rate at 18.99 mills last year, had projected a potential deficit of about $113,000, with the understanding that any possible deficit could be covered from the town’s estimated $2.7 million undesignated fund balance.
But with help from unanticipated revenue, a small Region 4 education budget surplus that was returned to the town, and under spending in some accounts, the projected deficit became a surplus of about $100,000 that will put the fund balance at about $2.8 million when the current fiscal year ends on June 30. Needleman predicted there would be some surplus remaining from the 2014-2015 budget, and urged the finance board to limit the tax increase to a 1.65 percent rise that would match the increase in spending.
A 1.65 percent increase would require a tax rate of about 20.96 mills, with a potential, but not certain, deficit of about $100,000. But board Chairman Keith Crehan said he would prefer to project a slightly lower deficit in the event there is less surplus remaining as the 2014-2015 fiscal year draws to a close. Crehan favored a tax rate of 20.99 mills, a figure that would project a deficit of around $55,000 at the close of the next fiscal year.
The 20.99 rate was approved on a unanimous and bipartisan vote, with Democratic members Campbell Hudson, Mary Louise Pollo, and Donald Mesite joining Republican Crehan in supporting the 20.99 rate. Democrat Fred Vollono and Republican Jeffrey Woods were absent fromThursday’s meeting.