Potential tax impact of 2012 warrant

I got this indirectly today from from the Town Finance Director.

It estimates the impact on the tax rate of the various warrant articles.  It reasonably assumes no significant change in the town’s total assessed valuation.  I believe also that we would have to add outstanding debt service (previously issued bonds), and credit any surplus from the prior year budget.

My estimate of the tax impact of town debt is about 40 cents/thousand, for a total estimate of $5.30.The total estimate is $4.91.  Last year the town portion was $4.46.

So if all articles pass and there is no significant surplus, I estimate the Town portion of the  Tax rate would go up 18.8% 10% next year.  Ultimately, it’s up to you.  Is there anything there that you would cut?

Update Mar 2: Added corrections and please see this post, and this post.

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4 Responses to Potential tax impact of 2012 warrant

  1. Cathy Sykes says:

    So how much would an 18% tax hike be equal to – about $2.00 per thousand?

  2. wolfeblog says:

    The actual numbers are given – $4.46 to $5.30 for an increase of 84 cents. That’s the town portion of the total tax rate. I think you might be applying the 18% to the total tax rate that includes local and state school taxes and county taxes.

    Also, this isn’t meant to be a prediction of huge tax increases. Someone sent me the official estimates and I’m just putting them out there. There are a lot of variables here, and there are some calculations that I don’t fully understand the timing of. For instance, I believe there is a year or more latency between bonded articles and their inclusion in the tax rate, owing to the money not being spent right away and the bond being issued later with interest due after six months.

    The other big variable is the actual tax revenue collected and surplus funds from the prior year.

  3. Bob Tougher says:

    Hi Bob
    I just wanted to clarify your post a little bit. Our total town tax impact, including warrant articles, is in the vicinity of $4.84. This figure assumes a $200 thousand transfer from our surplus fund and represents an increase of 38 cents per thousand. This is an estimate and subject to change if the amount of transfer from our surplus changes. Debt service is included in the operating budget, so there is no need to add an additional 40 cents. The 38 cents I have mentioned above represents an increase of a little over 3% on our tax rate of $12.20, and does not include the school district nor county budget.
    Bob Tougher

  4. wolfeblog says:

    Thanks for that.

    Bob Tougher is on the Budget Committee, so I defer to him. The original estimate from the Finance Director was $4.907, an increase of 45 cents over last year’s rate, or roughly 10 percent. Bob Tougher is saying that the surplus that will be applied will reduce that by about 7 cents to 38 cents, or 8.5% increase. When factored into the total that gets diluted to 3.1%.

    So as of now, a good educated guess for next year’s combined tax-rate is $12.79 – about 4.8% increase. That assumes no change in the state education or county components, but those are relatively small components that should not have a big impact.

    And as always, these are estimates made with the information at hand. As I understand it, there are other factors in play, but at least we won’t be caught flat footed next fall when the official rate is announced.

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