Charlestown’s budget is the definition of a good budget: It uses surplus funds to lower the tax rate, keeps our promise to pay police pensions, upgrades our animal shelter, funds education, maintains infrastructure, and provides safety and emergency management. Plus, the maximum recommended amount remains in reserve. In a discussion of this budget, some terms may need explanation.
Tax revenue collected: Total amount collected from all taxpayers and used to pay for education and services provided. Last year, tax revenue was $22.9 million; this year, it is $23 million, a slight increase ($70,000 or 0.31%) and much lower than the inflation rate.
Grand list: Total value of all property in town. This year it is $2.84 billion; it was $2.57 billion last year. The increase of $271 million is the result of new buildings, additions, and increased property values throughout town. The grand list is up 11%.
Tax rate: The rate paid on each $1,000 of assessed value. The tax rate depends on the grand list (which has increased), the tax revenue to be raised (which has remained approximately the same), and surplus used ($1.3 million). This year the tax rate is $8.20 versus $9.23 last year. Keeping the promise made last year, the tax rate has been reduced for a second year in a row.
Revaluation: Mandated every three years by state law, the process by which the relative market values of all properties in town are adjusted. Values are determined based on property sales between 2016 and 2019. Because of historically low interest rates and our low tax rate, buyers have been able to pay higher prices for homes. The value of most homes has therefore increased over values that were previously determined on the basis of sales from 2013 to 2016.
Tax bill: The amount of money you owe in taxes. If your property value increased less than 11.6% this year, you’ll see a decrease this year. If your property increased in value more than 11.6%, you’ll see an increase. To estimate your tax bill, divide your assessed value by 1,000 and then multiply that number by $8.20. For example, if your home is valued at $400,000, then 400,000 ÷ 1,000 = 400, and 400 × $8.20 = $3,280.
Unassigned fund balance: The amount remaining after paying for municipal services, education, capital maintenance and improvements; after paying debts; and after making a payment to reduce the tax rate. The unassigned fund balance is approximately 26% of the total budget, above the recommended amount to keep our bond rate low and be prepared for disasters, like a major hurricane or a pandemic!
Debt: Something owed; in our case, for things purchased over time and pension promises. The proposed budget contains a $1 million payment to Charlestown’s account in the police pension fund. This is not new spending but a partial payment of this debt.
Vote “Yes.” Remember you can drop your ballot in the white box by the main entrance to Town Hall.
Mary Lou Gentz