MEXICO – Selectmen on Wednesday set $28.50 per $1,000 valuation as this year’s tax rate.
The figure is the same as last year and carries with it the first surplus the town has had in several years, Town Manager John Madigan said.
“We’re still not out of the woods yet,” said Madigan. “But we’re on the right track.”
The fiscal year ended with a small surplus of $34,378, according to a preliminary audit, Madigan said. In 2004, there was a shortfall of $14,000. In 2003, there was a shortfall of $170,000.
Madigan said the town’s $3,091,000 budget, which includes school and county taxes, also includes an overlay of about $98,000. He said the town also has about $245,000 in capital reserve funds. To be raised by taxation is $2,261,621. The rest of the needed funds comes from a variety of revenue sources.
He said overlay funds are used to offset any tax abatements that may come up. If it is not used, then it would go into the town’s surplus at the end of the current fiscal year on June 30, 2006. A town the size of Mexico should have about $300,000 in surplus to carry it through until taxes are collected, he said.
Madigan estimated it will take two to three years for the town to amass a $300,000 surplus. Keeping the tax rate the same this year will go a long way toward restoring the town’s surplus, he added.
Helping to maintain the tax rate was a significant reduction in the town’s share of taxes paid to SAD 43. A new state funding formula locked towns’ share of property taxes designated for schools at 8.26 percent. Mexico had been paying a much higher percentage.
Madigan said higher-than-expected revenues, including $67,000 more from state revenue sharing, also contributed to maintaining the current tax rate.
Although the tax rate has stayed the same as last year, because of the doubling of the Homestead Exemption to $13,000, all homeowners who have not made changes to their property will likely receive lower tax bills, he said.
Tax bills are expected to go out in early September.
The first half is due without penalty by Oct. 28. The second half is due by March 3, 2006.
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