Finance panel sets new tax rate with increase under 1%
Updated 10:17 am, Thursday, May 21, 2015
A tax rate increase of less than 1 percent -- from 17.94 mills to 18.09 -- was approved Wednesday by the Board of Finance for the new fiscal year starting July 1.
The 0.084 percent rise for 2015-16 was adopted with support by six finance members, with Janis Collins opposed.
Under the new tax rate, a property owner with a house assessed at $600,000 and a market value of $857,000 will pay a tax of $10,854 compared to the current $10,764, or a $90 difference, according to Finance Director Gary Conrad. Taxes on a house assessed at $1.5 million, with a $2.143 million market value, will pay $27,135 in taxes, $225 more than the current $26,910.
The new tax rate will be used to finance a total spending package of approximately $202.5 million for the new fiscal year.
The figure was adopted after finance member Michael Rea sought to amend the motion to keep the mill rate at the same level, but that motion was defeated 5-2, with Rea and Collins voting in favor of the amended motion.
The new mill rate will keep the town's fund balance at 11 percent, which is in keeping with a policy set previously to maintain the reserve between 9 and 11 percent. With the new tax rate, the budget reserve is projected to stand at $22,275,582.
Discussion among board members on the tax rate centered on whether the town should draw down on the fund balance when the economy is strong.
"It's been a very good year and I would like to see no tax increase," said Rea, adding that no increase would be the "icing on the cake." He said not increasing taxes would still keep "a little more than 10 percent in the reserve fund."
But finance board member Brian Stern countered that "in good years we should go to the maximum end of reserve."
"The reserve should be held for a time when something unexpected happens," said member Jennifer Tooker, adding the 11 percent "right now is the right number."
First Selectman Jim Marpe said he endorsed the "maximum reserve of 11 percent. "I'm taking a conservative stance," he said.
Selectman Avi Kaner agreed, adding that when he was a finance board member the panel set the policy for keeping the fund balance between 9 and 11 percent.
He said it should be kept at that amount so "when times aren't as good, you can draw from it."
"What's this doom and gloom?" said Collins. "What are you anticipating?"
Kaner said anyone who studies economics knows there can be an economic downturn. "It's just conservative financial planning," he said. "I'm not a fortune teller."