Mayor proposes 5-cent increase in tax rate for Manchester

May 18, 1994|By Darren M. Allen and Anne Haddad | Darren M. Allen and Anne Haddad,Sun Staff Writers

Despite proposing a 1995 budget that is 6 percent lower than this year's, Manchester's mayor is seeking a 5-cent increase in the town's tax rate, according to a memo sent to Town Council members.

This budgetary incongruity arises from a proposal to change the way the town pays for some services, Town Manager Terry L. Short said.

"We are redefining things and looking at all of our financial processes," Mr. Short said.

As a result of those changes, some services now paid for with fees -- water used by the fire department, for instance -- would be paid for through taxes, Mr. Short said.

Mayor Earl A. J. "Tim" Warehime Jr. has submitted a $1.36 million spending plan for the fiscal year beginning July 1, a decrease of nearly $89,000 from this year's $1.45 million.

But the town's property tax rate -- currently the county's lowest at 41 cents per $100 of assessed valuation -- would rise to 46 cents under the mayor's proposal.

The town's water rate also would increase by 10 cents per 1,000 gallons.

The Town Council will hold a public hearing on the proposed budget at 7:30 p.m. May 25 at Town Hall.

While total projected spending is less than the current fiscal year's, the town's general fund -- which covers trash, police protection, roads and administration -- would grow from the current year's $602,910 to more than $654,700, an 8 percent jump.

Mr. Short said the larger general fund is the reason for higher taxes.

He said the mayor wants the water and sewer funds to be self-sustaining. The water rate increase is deemed necessary to help eliminate deficits in that budget which, in the past, were covered by transfers from the general fund.

"After a great deal of discussion, review of programs and evaluation of the current and future needs of the town . . . it is absolutely necessary" to increase the tax to 46 cents, the mayor wrote.

According to Mr. Short, the average tax bill would go up about $20 a year, or about $1.66 a month. He said the water fee increase would add 43 cents a month to the average water bill.

"The average homeowner will pay a little more than $2 extra a month under this budget," he said.

The main causes of the increase in the general fund are the expected rise in the county landfill tipping fee and a shift in the way the town pays for the water used by firefighters and other departments.

Although the county has not established a new tipping fee, it has warned the municipalities to plan for $53 a ton. An increase to that figure means the town would pay $127,940 next year instead of the $111,400 it is paying this year.

The town will transfer $4,600 a year from the general fund to the water fund to pay for water used by the volunteer fire department. The town spent about that much last year, but it was paid directly out of the water fund, Mr. Short said.

The budget strategy will have an impact on residents' pocketbooks. In the past, the town has paid for the water used by fire, parks and other departments through the water and sewer fund.

Mr. Short said a better accounting method is to pay those expenses out of the general fund, because they are operating costs.

That also means the money to pay for that water can be raised through taxes, allowing residents to deduct it when calculating their income taxes. Homeowners may not deduct fees they pay to a water fund.

This is the first year the budget process has gone on in public meetings, Mr. Short said.

"The [council budget meetings] used to be in closed session," and the mayor and town manager would go out for dinner and come back with a budget, he said.

He said his staff began working on the budget in December, and has brought it to public meetings since February for input from the council.

The budget can be passed only if three members of the current four-member council vote for it. Recent attempts to seat a replacement for former Councilman Robert Kolodziejski have ended in ties, so getting a majority vote is far from certain.

"Don't forget that we are responsible for ensuring the short- and long-run financial viability of the town of Manchester and the resulting sense of community and high quality of life for all longtime, new and soon-to-be residents," the mayor wrote in the memo.

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