Middlebury weighs tax surplus targets

The reappraisal has hit many with noticeable increases in their (Middlebury property tax) bills … Using some of the fund for tax rate relief would help everyone.
— Victoria DeWind

MIDDLEBURY — Middlebury residents at next year’s town meeting will again be asked to use some of the $2.5 million in accrued local option tax surplus to reduce property taxes. Town leaders will spend the next few months asking residents how much of the surplus should be used, and for what specific purposes.
“If we do want to go forward in using that money, what policy would you like to have, and what minimal balance would you like to carry going forward to plan contingencies for the bridge?” Middlebury Town Manager Kathleen Ramsay asked at Tuesday’s selectboard meeting. “There are a number of questions to be asked.”
Last year, town meeting attendees agreed to use $400,000 of the surplus — $325,000 to pay for extra capital projects, and $75,000 to provide an extra property tax cushion. Specific projects that received local option tax surplus money included stabilizing 210 feet of riverbank and paving 2,720 feet of Shard Villa Road, rebuilding the basketball courts at Harold Curtiss Park in East Middlebury, and designing the proposed rehab of buildings at the old wastewater treatment facility for storage space.
This year, the Middlebury Infrastructure Committee is proposing to use $400,000 toward capital improvements, with an additional:
• $57,040 to help cover the town’s share of a new passenger rail platform to be built in between Middle Seymour and Maple streets. Total cost of the 300-foot-long-by-12-foot-wide platform has been placed at $665,000, of which VTrans will pay $250,000. The $57,040 would be added to reserve funds that will pay Middlebury’s share of the project.
• $100,000 in downtown sidewalk and curbing improvements to be made in concert with the $72 million Middlebury rail bridges project, which will kick into high gear next summer. The upgrades in question involve replacing sidewalk and curbing on the west side of Main Street, north of Mill Street, according to Middlebury Public Works Planning Director Dan Werner.
The combined total of $557,040 in local option tax surplus would reduce the fiscal year 2021 capital improvements budget draft from $1,457,379 to around $900,000. One penny on Middlebury’s property tax rate yields around $95,000. So applying $557,000 in surplus to capital improvements would reduce the potential fiscal year 2021 municipal property tax rate by 5.86 cents.
It was on March 20, 2008, that Middlebury voters endorsed a 30-year local option tax of 1 percent on sales, rooms, meals and alcohol purchases in town in order to bankroll the community’s $7 million debt on the Cross Street Bridge project. Middlebury College agreed to underwrite the remaining $9 million for the $16 million project.
Middlebury’s local option tax revenues have comfortably exceeded the town’s annual debt service for the bridge, to the extent that the surplus has grown to around $2.5 million, according to Town Manager Kathleen Ramsay. It’s money that town officials have agreed must be dedicated to Cross Street Bridge-related expenses, including maintenance. Annual maintenance has been amounting to around $5,000-$10,000, Ramsay said.
The state is scheduled to pave the bridge in 2021, Ramsay added.
Selectboard members recently put out a call for other ideas for the surplus money, which drew emails from former selectboard Chair Dean George and former Middlebury Planning Commission Chair Victoria DeWind.

George, a member of the board when the local option taxes were approved, urged his successors to “use those excess revenues to offset any property tax increase for the coming year, and not be tempted to use the funds for any new projects.”
He explained tax breaks will be particularly critical due to the impacts of the recently completed reappraisal of townwide properties. That reappraisal, he said, has most affected “modest, affordable homes” in Middlebury, some of which have been assigned new values that are 40-50 percent higher than they were last year.
“The increase in property values is great if you are planning to sell your home, but if you wish to continue living in Middlebury as most of us do, it means higher property taxes and insurance,” George stated in his email.
DeWind suggested using some of the surplus to reduce or eliminate borrowing for equipment purchases. And she agreed with George that many taxpayers need to be cushioned from the impacts of the reappraisal
“The reappraisal has hit many with noticeable increases in their bills,” she wrote in her email to the board. “And there has been no noticeable benefit in the school merger tax reductions that were part of the plan.
“Using some of the fund for tax rate relief would help everyone,” she concluded. “Taxes are increasingly challenging.”
Rep. Robin Scheu, D-Middlebury, is former executive director of the Addison County Economic Development Corp. (ACEDC) She advised the board on Tuesday to earmark some of the surplus to repair water mains that serve some of the town’s largest industries based off Exchange Street. Those mains have failed periodically in recent years, resulting in financial losses for businesses.
“That, to me, is a serious infrastructure problem, and I would like to see the town consider dedicating some of this money to those kinds of infrastructure improvements,” Scheu said. “If we want to keep property taxes down, we want to keep businesses in town and on Exchange Street, there’s not going to be a lot of incentive to stay there and grow your business there if you can’t have the water you depend on to run your business.”
Fred Kenney, the current top administrator of the ACEDC, recommended the board consider tapping some of the surplus for economic development initiatives that will be proposed next spring by the Middlebury Economic Health Committee, which he chairs. The panel is still fine tuning its recommendations, some of which will cost money, Kenney noted.
The board will continue to accept ideas for the local option tax surplus as it shapes a March 2020 town meeting warning that must be put to bed in January.

The selectboard on Tuesday also heard South Street neighbors’ concerns about a proposed 5-Megawatt solar farm that is being targeted for Middlebury College-owned land off South Street Extension, near the Eddy Farm for Horse & Rider. Officials from the college and Encore Renewable Energy LLC discussed the plan at an Oct. 24 meeting that was covered in the Monday, Oct. 28, edition of the Independent. Three South Street residents urged the selectboard on Tuesday to oppose the proposed location of the solar farm, saying the more than 30 acres of panels would ruin what is a panoramic view for the people who walk, jog and cycle along that road.
The application won’t face state Act 250 or local review; as a power-generating project, it will be judged by the Vermont Public Utilities Commission. But the PUC will weigh comments from abutters, town officials and the Addison County Regional Planning Commission.
Encore and college representatives are slated to explain their solar farm plan to the selectboard at its Tuesday, Nov. 12, meeting.
Reporter John Flowers is at [email protected].

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