MIDDLEBURY — The Middlebury selectboard on Tuesday approved a fiscal year 2011 residential tax rate of $2.5637 per $100 in property value, a rise of approximately 10 cents above the current rate of $2.4627.
The new rate translates into a property tax increase of $202 for the owner of a homestead (home and two acres) valued at $200,000, according to Middlebury Assistant Town Manager Joe Colangelo.
It should be noted, however, that the impact will be less for residents whose household income qualifies them for property tax prebates under Act 68, Vermont’s education funding law. According to information supplied by the Vermont Department of Taxes, 1,050 of Middlebury’s 1,577 households (66.6 percent) receive prebates of varying levels.
Colangelo said approximately $195 of the $202 tax hike for a $200,000 homestead is related to school costs that are associated with the budgets for the UD-3 and ID-4 school districts that were approved by voters earlier this year. Middlebury’s new education property tax rate is $1.7513 for $100 in value, which is up from the fiscal year 2010 rate of $1.6536.
The UD-3 board has already begun talking about crafting a 2011-2012 budget that is level-funded, or perhaps even as much as 3.5-percent less, than the 2010-2011 spending plan that took effect on July 1 (see related story, Page 1A). Such an approach would closely mirror the selectboard’s budgeting strategies for Middlebury’s municipal budget. The selectboard in March, for the second year in a row, pitched a town spending plan they anticipated would not bump the municipal tax rate of 80.76 cents per $100 in property value. But the fiscal year 2011 municipal rate approved by the board on Tuesday is around a quarter of a cent higher — 81.01 cents per $100).
Colangelo attributed the slight boost in the municipal rate to a lower-than-anticipated grand list and a decision by the local voters at town meeting to bump the budget by $1,500 for the Addison County Readers Program.
Middlebury’s taxable grand list shrank for three main reasons, according to Colangelo. He said the Lodge at Otter Creek’s actual value for fiscal year 2011 ended up being $1 million less than had been estimated; the South Ridge planned unit development off Middle Road came in at $400,000 less than had been forecast; and the assessed values of hydro properties within the town borders were reduced by a combined total of around $250,000. And Colangelo noted Middlebury in fiscal year 2011 will begin phasing out its machinery and equipment tax, an action that will decrease revenues in the short-term but hopefully increase the grand list in the long term.
A few other facts related to Middlebury’s new tax rate:
• The nonresidential rate is $2.4596 for $100 in value, up 7.3 cents from the current $2.3866.
• Each Middlebury household will pay $1.58 as a result of a previously approved property tax break extended to veterans.
• Middlebury’s Common Level of Appraisal (CLA) dropped from 85.58 percent in fiscal year 2010 to 81.96 percent in fiscal year 2011. That means for fiscal year 2011, Middlebury properties will be valued at 18-percent less than their actual market values, according to Colangelo. He noted that when the CLA (a measure of equity among real estate classifications) exceeds 20 percent, a reappraisal is mandated by state law. Middlebury last performed its townwide reappraisal of properties in 2005.
Reporter John Flowers is at [email protected].