Council could vote on new budget Monday night

LACONIA — The city budget could be approved as early as city council's next regular meeting at 7 p.m. on Monday night.

There will be opportunity for public discussion regarding the proposed budget during the meeting. Council could take a vote on the budget later in the evening. 

During a wide-ranging discussion earlier this week, councilors learned their budget will be tax cap-compliant, the tax rate will increase one point and increases in salaries and benefits will remain in the budget.

Using exemptions authorized in the city charter, the city budget would total $59.4 million in the upcoming fiscal year to be raised by taxes, a 7.57% increase in spending over the previous year. 

The exemption, if used, would allow the city to exclude $1.48 million in long-term debt expenses from the budgeting process. This would keep the city budget compliant with the tax cap. Without employing the exemption, the city’s budget proposal tax cap works out to about $58 million, or 4.96% higher than the previous fiscal year, which came in at about $55.2 million and was below the tax cap.

“Within the tax cap, within the charter, it does state that it gives us an opportunity to exempt certain numbers from the budget to allow us a little bit of flexibility in the total amount to be raised by taxes following the preparation and passing of the budget,” City Manager Kirk Beattie said. “As we moved into this spring, it was made very clear by all of our departments that we really needed to do something about our recruitment and retention — both recruitment and retention was based on salaries.”

City councilors held a public hearing on June 10 regarding the proposed budget. Now, counselors must vote to approve it by the end of July.

Of the amount to be raised by taxes, $24.8 million would be from city taxes, $25.66 million from the school district, about $4 million from the county and about $4.9 million from the State School property. 

The property tax rate would go up one point to $14.91 after falling one point to $13.91 per $1,000 of assessed value last year.

Over the course of the discussion, Ward 5 Councilor Steven Bogert, who also represents Laconia as a Republican in the Statehouse, noted the city will need to address roughly $40 million of road repairs and will be on the hook to bond out a project to purchase land and construct a new building for the public works department soon. He cautioned councilors to keep that project in mind when considering their available sum to be bonded — the city hasn’t yet broached 30% of the limit.

“Every time we bond something, it’s going to push the tax cap or we’re going to have to vote again to exempt something,” Bogert said. “If I look at that framework, the categories of stuff that are available for us, one being the needs of the city, one being the wants and then there’s ones that are luxury. The luxury items I would have to say, here in the near future, I don’t see any point in moving on any luxury item when we’re already looking at pushing the envelope on the tax cap.”

The public works building is beyond repair, mainly due to problems with its floor. Public Works Director Wes Anderson previously told council a property nearby to major arteries of the city would be best to allow quick and direct access, especially for plows during the winter months.

While the city hasn’t hit anywhere near the bonding limit, the payments necessary to service debt on the bonds each year will continue to increase city expenditures.

“We’re going to constantly bond ourselves out of a problem, to override ourselves out of the bonded problem, and keep moving back and forth,” Bogert said. “At the moment, we have some critical needs that will be coming up in the next couple of years.”

Ward 3 Councilor Eric Hoffman noted that while appropriations to the city’s welfare department are needed, the city’s approach to homelessness is reactive, and said proactive measures are needed to properly address the root causes of the issue. Naming housing as a primary example, Hoffman said changes in zoning could be leveraged to incentivize the development of affordable housing down the line. 

“We’re addressing it by addressing the needs of our welfare department and how many people are coming in asking for help,” Hoffman said. “This issue is not going away and I think in future budgets, which I don’t see that we have the room for at the moment, but in future budgets we need to find ways of dealing with this issue that are fair to the city, fair to the property owners but are also fair to the taxpayer — we need to find real solutions to this problem, because there’s going to be a limit to our tolerance and the city’s tolerance to how big that welfare budget gets.”

The city is spending more each year to provide housing relief and assistance. The past year the welfare assistance costs skyrocketed to an average of $11,000 per month. The prior high over the last 10 years came in 2019 at just over $6,000 per month.

That money is spent on items including burial services, electric, propane and oil utilities but primarily on rent and shelter assistance. Rent assistance refers to assisting an individual remain in housing they’ve already secured — the city spent $62,587 on that line item in fiscal year 2024, an increase from $38,546 the previous year. 

Mayor Andrew Hosmer, who previously served as a city councilor representing Ward 6, said this will be the seventh city budget process he’s been involved with, and each of the previous six have been passed unanimously.

Putting partisanship aside, city department heads worked to draft and pass pragmatic budget proposals which might serve the betterment of constituents in all six wards of the city, he said. Recalling previous successes through the budget process, Hosmer implored councilors to work together to pass the budget for the next fiscal year.

“Budgets aren’t perfect, they are our good faith attempts to find compromise, to lead with our values, to be judicious and wise with taxpayer money. To let our teachers, our firefighters, our police officers, our [department of public works] workers know they are valued and we’re committed to them,” Hosmer said.

“I hope, as this process moves forward, that we don’t let 'perfect' be the enemy of the good.”