MIDDLEBURY — Middlebury’s local option tax revenues continue to outpace the annual amount needed to retire the community’s debt service for the Cross Street Bridge project, according to municipal officials and information supplied by the Vermont Department of Taxes.
It was in 2008 that Middlebury voters agreed to establish a 1-percent local option tax on sales, rooms, meals and alcohol as a means of covering the community’s annual share of $600,000 in debt service (over 30 years) for the $16 million Cross Street Bridge project. Middlebury College has also agreed to contribute $9 million toward the project, which was completed in 2010.
The Vermont Department of Taxes is in charge of collecting local option taxes for communities that have instituted them. The department’s latest figures, covering the second quarter of 2015 (April, May and June) show a yield of $229,419. That’s roughly $4,000 less than the same quarter last year, but still puts the town on a path to well exceed its local option taxes goal for the year.
Middlebury local option tax payments from the state amounted to $652,083 during calendar year 2009, the first full year of collection. That rose to $702,910 during 2010; $731,499 during 2011; $768,155 during 2012; $816,726 in 2013; and $882,710 during 2014, according to state officials.
The third quarter of each year has proved to be the most lucrative for Middlebury’s local option tax collections, state figures indicate. So far this year, Middlebury has collected $433,339 in local option taxes, with an additional six months to come in.
“Certainly, the local option tax has exceeded our expectations,” Middlebury Town Manager Kathleen Ramsay said.
Middlebury selectboard members have historically pledged to use the special tax revenues exclusively for debt service and maintenance for the Cross Street Bridge project. The board recently used $200,000 in fund balance from the local option taxes to underground some utilities associated with the Cross Street Bridge, an undertaking that has coincided with construction of the adjacent new Middlebury municipal building at 77 Main St., noted Ramsay.
There is currently around a $500,000 balance in the local option taxes fund, according to Ramsay. The firm VHB Inc. is now estimating what the town should be reserving for reasonable maintenance and capital expenses for the bridge into the future, according to Ramsay. The selectboard has asked for that analysis so that it might better consider its options for the potential allocation of surplus local option tax funds in the future.
Reporter John Flowers is at [email protected].