Vergennes City Council mulls budget that could spike tax rate
VERGENNES — The Vergennes City Council this week will be studying a $1.848 million draft general fund budget for fiscal year 2016-2017 that, if approved as is, could raise the city’s municipal tax rate from 75 to 84 cents.
A 9-cent hike in the municipal tax rate would translate to an additional $180 of annual taxes for a $200,000 home.
That spending does not include the user-supported sewer budget, and City Manager Mel Hawley on Tuesday also recommended a $34 annual increase in the per-unit sewer rate.
Council members will in the next two weeks consider both Hawley’s proposed general fund budget, which is being driven higher largely by higher police spending, and his sewer rate proposal.
They will meet again at 4:30 p.m. on Tuesday, June 21, and on Tuesday, June 28, when the council is expected to make the Vergennes budget and municipal tax rate final.
Addison Northwest Supervisory Union officials hope also by the end of the month to know what local school tax rates will be. ANwSU business manager Tonia Mears said on Wednesday she hopes to hear final numbers from the state on or before July 1.
Vergennes Mayor Bill Benton on Tuesday asked council members to consider what tax rate might be “palatable to the public” and to study the budget carefully before this coming Tuesday’s meeting.
“I would urge you to think about it,” Benton said.
Hawley said the draft budget he presented on Tuesday, which he emailed to council members before the meeting, did not include any new programs or spending. He said he went over line items carefully before forwarding the draft plan.
“That’s why it’s taken me so long to get you this budget. It’s a pretty serious increase,” he said.
Police spending in the draft rises to $936,668 from $765,303, an increase of about $171,000.
Hawley said the department’s detective is no longer attached to a larger grant-funded drug task force, and the department is now responsible for his $70,000 of salary, benefits and workers’ compensation.
In total, the salaries and benefits line items in the police budget show an increase of about $86,000.
Also, Hawley said the department has been frugal and kept its cruisers on the road, and now it is time to replace two of them. The capital purchases line item in the police department budget shows a $74,000 increase to $100,000.
Hawley said he didn’t support Chief George Merkel’s full request a year ago and made cuts before presenting that budget to the council, but does back higher police spending this time around.
“I don’t like the total, but I support this,” he said. “We need good vehicles.”
Other departments’ proposed spending shows modest increases except in the case of public works, which drops $6,400 to $745,916 largely due to a decrease in equipment purchases.
The administration budget increases about $10,500 to $384,207, with hikes in insurance, legal and IT line items.
The city’s fire department and recycling costs — surrounding towns share those expenses — are seen rising by only a few thousand dollars.
The grand list remains fluid with grievances and one court case outstanding, but Hawley said he is confident a penny on the tax rate will raise $22,000. That means the council will have to cut that much for each penny it shaves off the rate, he said.
Hawley is proposing to use $60,000 of unused funds from the 2015-2016 budget to offset 2016-2017 spending and reduce the tax rate.
That number could be larger to help lower the tax impact, Hawley said, but he cannot yet pin down exactly how much will remain unspent at the end of June.
“I can’t give you a bigger number to guarantee quite yet,” he said.
As for the sewer budget, Hawley recommended a hike to $87.50 per quarter for most residential and small commercial users to $96.
“That will keep us in the black,” he said, adding it would preserve a fund balance of $35,000 to $40,000 in the short term.
But Hawley cautioned it might not be a long-term solution.
“I think we all know this is not the last time we will talk about sewer rate increases,” he said. “We will be fine for another year.”
Andy Kirkaldy may be reached at [email protected].
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