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Fort Fairfield Property Taxes to Increase 1.2 Mils


Larger School Budget Major Driver in Tax Increase


By:  David Deschesne

Fort Fairfield Journal, September 27, 2017


   As expected after the massive school budget increase, property taxes in Fort Fairfield will be rising another 1.2 mils for the 2017-18 fiscal year budget.

   The mil rate increase is driven by two factors.  First, is a 6.41 percent increase in funding for the school, which is an increase of $133,842 over last year's budget.  It requires a mil rate increase of approximately .86 mils.  The second item is a capitol reserve of $53,227 for the town, which requires a mil rate increase of approximately .34 mils.  “I would like to note that in April I requested more money for the town reserves,” said Fort Fairfield town manager, Jim Risner.   “So I cut $97,000 out of the town's reserve request to try to bring the mil rate down.” 

   Town councilman, John Herold spoke in opposition to the seven percent interest assessment on outstanding property taxes.  “I realize that the seven percent interest rate is designed to be a motivator to get the people to pay their taxes.  At the same time it can make it difficult for people to pay their taxes especially as the rate and amount builds up,” Herold told his fellow council members.  “I don't know where everybody wants to come down on this.  The town's interest is basically the taxes, period.  The motivational effect versus the deterrent effect of seven percent interest rate - it's up to you how you want to think about it.  I would like to see that interest rate lowered to, if four percent isn't appropriate, perhaps five, but to something lower than seven.  When I asked before why we were charging an interest rate of seven I recall receiving the answer, 'that's the maximum amount allowed by law,' in other words, 'because we can.'  So decide whether it's because we can or something else because we should.

   Council chairman, Jason Barnes disagreed with Herold.  “My opinion is that it is a penalty interest, so-to-speak.  We don't want to be in a position in there with mortgage rates because you lose the incentive to get those taxes paid and it's critical for the town to receive those on a timely basis,” said Barnes.  “The tax bills are out plenty early, interest isn't charged until March 1.  I'd be reluctant to change.”

   Councilman Mitch Butler spoke in support of keeping the interest rate at seven percent in order to help the town recover costs for liens and other legal paperwork involved with late taxes.  “I think it's going to help the town as far as keeping the bills paid and if you have to go to court or something like that, that covers some of that expense.”

   Councilman Scott Smith, was also in support of leaving the interest rate where it is.  He explained, “if people have a hard time paying their taxes they always have the opportunity to join the tax club.  They can pay those taxes monthly, break that tax bill into twelve payments.  So there's an incentive for them.” 

   Melissa Libby, also a member of the town council agreed with the majority view.  “There are other options and the seven percent is not applied until after the fact so I think the seven is fine.” 

   “I got my answer,” Herold relinquished.

   The town council voted 4-1 to approve the mil rate increase with councilman Herold being the only member to vote against it.  The mil rate will now be 25.7 mils, or $25.70 for every one thousand dollars in property tax valuation.  For a $100,000 home, that would be an additional tax burden of $120 per year over what property owners are already paying.