Meredith selectboard votes against all petitioned articles, including tax cap

MEREDITH — After a lengthy public hearing, the Meredith Selectboard unanimously voted Feb. 15 to recommend against passage of a petitioned warrant article that would enact a 3% tax cap, along with two other petitioned articles that will appear on the town warrant in March.

Town Manager Troy Brown calculated that, if the tax cap were in place now, Meredith would be able to propose its $12.6 million operating budget for 2024 and have $627,039 to spare, but would have to cut spending on capital improvement plan projects by $112,961. The total amount of spending in the 2024 warrant would exceed the proposed tax cap by $775,131, he figured.

Brown explained that, under the proposed cap, the town would be allowed to increase taxation by 3% over the previous year’s net assessment to taxpayers. In his example, last year’s assessment or “net amount raised” was $12.46 million. By state law, he said, the town would add back the amount of the year-end fund balance that was used to reduce taxes ($385,000), yielding a figure of $12.97 million. That would be the base amount used to determine how much taxation would be allowed this year.

That amount works out to be $13.23 million, or $385,328 more than last year’s taxation.

“If the tax cap was in place already,” Brown said, “this would be the cap for the 2024 proposed budget to be discussed in March.”

Brown’s calculation did not take into account the effect of offsetting revenues, which would reduce the tax impact of the spending proposals.

Residents testifying during the public hearing on the tax cap focused on their property assessments, which substantially increased during last year’s revaluation. Mark Johnson said his taxes went up 54% last year.

Former selectboard member Ray Moritz pointed out it is what is being spent, rather than property values, that determines the tax bill. If spending remained the same, an increase in property values would decrease the tax rate, but the tax bill would be equivalent.

In fact, even though spending was higher, the Meredith tax rate did decrease, but the increased property values many residents experienced resulted in higher tax bills.

Moritz said the town’s decision to increase benefits to town employees will “pretty significantly” increase taxes, and changing “the whole structure of health insurance” will result in “pretty dramatic increases” in the 2024 budget.

Brown acknowledged that “we took a very aggressive approach to our benefits for employees.”

He explained that “grandfathered” employees — those already on payroll — were receiving health benefits at no cost or at substantially reduced costs, while newer employees were required to split the costs 50-50.

“Depending on the situation, they were having about $200 a week taken out of their paycheck,” Brown said, “in a time when we’re having an older workforce that is leaving or retiring. We’re trying to recruit new employees, new police officers, new truck drivers, new water and sewer plant operators, and we’re offering them $21 an hour and we’re telling them they’re going to have to pay 25% towards the health insurance costs. So my aggressive change was, I made it fair, across the board, to all employees. All employees today pay 10% towards their health insurance premium costs; the town picks up 90. That’s a nice competitive benefit when I’m competing against other communities.”

Jim McFarlin said that, if all of the warrant articles pass at town meeting, taxes would increase by 11%, “and it could be higher than that.”

McFarlin noted the budget calls for spending $580,000 to hire fire department personnel, but that figure covers only the costs from April to December. Carrying that forward into next year, the full year’s cost amounts to more than $773,000.

“I’ve been here for a year and a half now,” Brown said, “and I recognized very soon, as I was meeting with different departments, that the fire department had needs in staffing.”

When considering applying for a Staffing For Adequate Fire and Emergency Response, or SAFER, grant to hire personnel, the town decided to conduct a study on department needs “instead of just going after a grant and making up some kind of number and say we need three, we need six, we need eight,” Brown said.

The study recommended hiring six full-timers and an administrative assistant for what now is a volunteer fire department.

“We shouldn’t be in this position right now,” Brown said. “It would have been nice if we could have been adding a couple full-timers over the last three, four, or five years, so we could absorb it into the tax rate a little more easily.”

Karen Sticht said her home, built on a “view lot” in 1980, is now assessed at $1.1 million, and lake lots have even higher assessments.

“You’ve done all this,” she said. “You’ve hurt yourself, you’ve hurt the residents, and it’s just not sustainable for view and waterfront taxpayers to pay the bulk of the town and school taxes. ... It’s taxing them out of their houses and out of their property.”

She added, “And that’s why I am supporting a 3% tax cap.”

Lynn Montana said taxpayers got a “double whammy” from the revaluation and the increased spending, “and now you’re asking for us to adopt an aggressive benefit package to our employees ... and we’re also being asked to pay full payment for the fire department, all in one year. I think you really, you know, shot us with both barrels here.”

Montana said Meredith was paying its former town manager the same price Manchester paid.

“The wages we were paying were probably the highest wages in the book, for towns that were much larger than us,” she said, adding that people in Moultonborough’s town office told her, “they’d give anything to work in Meredith, that makes so much more, and the benefits are better.”

Montana said her tax assessment increased by 71% and her taxes went up 17% last year.

“I just think a 3% tax cap is needed,” she said.

Frank Murphy pointed out that not all of the warrant articles require taxpayers’ money. An article that would address water quality problems on Lake Waukewan would be covered by a grant.

There was some discussion about the fact that school taxes account for most of the increase in the tax rate. Selectboard member Jonathan James said municipal taxes make up only 25% of the tax rate.

In addition to opposing the tax cap, the selectboard voted not to recommend an article that would establish a municipal budget committee and one that would require the hand-counting of election votes.