JAY — Town Manager Shiloh LaFreniere told the Select Board and Budget Committee on Tuesday that she proposes using some of the $6.9 million in the undesignated fund to stabilize the tax rate for 2021-22.

She said for the proposed $5.28 million budget for 2021-22, she included $125,000 of the $127,500 surplus approved by selectpersons in August for the 2020-21 budget.

The board set the tax rate at $17.50 per $1,000 of property valuation for this fiscal year, which ends June 30. It leaves some money for abatements. What is not used for abatements, lapses into the undesignated fund.

The board set the tax rate for 2020-21, expecting there will be a significant decrease in valuation of the Androscoggin Mill, owned by Pixelle Specialty Solutions based in Pennsylvania. The loss in valuation is attributed to the pulp digester explosion on April 15, 2020. The company announced in December it would permanently idle a paper machine in connection with the digester rupture and would not rebuild its wood pulp operation. The company continues to operate two paper machines to make specialty papers.

LaFreniere said it’s anticipated that money from the undesignated fund will be used to stabilize the tax rate for 2021-22.

The board will make a decision on the amount to be used, prior to setting the new rate next August. After that, Jay will apply to the state’s Sudden and Severe Valuation Loss Program to ask the state to reduce its valuation because of the lower mill value. The adjusted valuation, if  approved by Maine Revenue Service, would affect the town in 2022-23. Initially, it was thought that it would affect the town in 2021-22, but since the adjustment would come after July 1, it wouldn’t be until the following year.

The budget proposal is $12,800 less than the current budget. After factoring in an estimated $2 million in revenue, the net municipal budget would be about $3.21 million. It represents a decrease of $7,274, or 0.22% from the current budget, which ends June 30. This does not include the town’s share of the Regional School Unit 73 or Franklin County budgets.

The Select Board and the Budget Committee will vote on the proposed budget on Feb. 1.

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