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Middlebury seeks new tax bill schedule

MIDDLEBURY — At their town meeting in March, Middlebury voters will be asked to shift the community’s property tax schedule from a three-bill cycle to a two-bill cycle. Officials said the change is predicated on the fact that the current Aug. 15 tax payment falls early in the state of Vermont’s Homestead Declaration cycle.

The new proposal — to be fielded at the annual gathering to be held on Monday, March 6, at 7 p.m. at the Middlebury Recreation Center at 154 Creek Road — asks that “taxes on real property for fiscal year 2023/2024 (be paid) in two equal installments due in the Treasurer’s Office on the 15th day of November 2023 and the 15th day of March 2024.”

The current Aug. 15 payment would be eliminated. 

Although it would mean one fewer bill for taxpayers, each of the two remaining tax bills would be larger than in the three-bill system. 

Middlebury Finance Director Nicholas Gill stated his case to the selectboard in the following letter:

“As you are aware, for several years the Town of Middlebury has levied property taxes in accordance with the following schedule. (Please see attached).

For several reasons, it has become apparent that this schedule is in need of an overhaul.

Of primary concern, is the Aug. 15 tax payment. The first deadline falls very early in the state of Vermont’s Homestead Declaration cycle. Of course, this is a rather technical issue, but the consequences are nevertheless very distressing to taxpayers.

Given the early mailing date, bills are often mailed BEFORE homestead deductions can be properly reflected, leading to routine and unnecessary panic for many taxpayers. These initial bills often reflect hundreds, if not thousands of dollars in additional tax liability compared to the prior year.

Like clockwork, the Finance Office will field dozens of frustrated and anxious taxpayers who are understandably very upset by the numbers reflected on their bill. The Finance Office is charged with fielding these complaints from a position of little knowledge. Homestead declarations are a state of Vermont program, and we at the town offices are not aware in advance what subsidy a taxpayer might receive from the state. The time it takes to respond to phone calls, emails and walk-ins absorbs precious resources for both the Finance Office and Town Assessor.

From June 30th to Oct. 30, the state sends Middlebury a monthly file containing homestead declaration subsidies. The state also sends weekly files with changes to homestead declarations. With each of these file exchanges tax bills are updated, and the town must mail revised bills. Not only does this require more time and resources, but often leads to additional confusion when taxpayers receive two or more bills (instead of one) and taxpayers are left to guess what their final bill might be. It is safe to say that this is a mess that the town would do well to avoid.

The three-bill cycle has been adopted in the past, out of concern for budget conscious taxpayers who do not wish to be hit with unexpected large payments. In theory, by receiving the bill early, taxpayers will have more time to prepare. Ironically, as we have seen, the opposite is often true.

In today’s world of electronic services, Bill Pay is provided by most banking institutions as a free service. Bill Pay allows taxpayers to pay a base amount monthly as to avoid a lump sum surprise payment later in the year.

The Finance Office would be happy to advise all townspeople on how such arrangements could be made with their banking institutions. In addition, we will gladly accept checks in the mail or in office throughout the year and out of cycle to avoid these unexpected budgeting problems.

With these issues in mind, those in our office are requesting that the billing cycle move to a two-bill schedule. Billing dates of Nov. 15 and March 15 would allow all homestead deductions to come in before initial bills are mailed. If a transition is voted in by taxpayers, the Finance Office would send a warning to taxpayers in July to alert of the change, further reducing the potential for misunderstanding.”

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