Less than inflation

Weather may or may not impact the Harwood Unified Union School District’s first public budgeting meeting, slated for today in the Crossett Brook cafeteria from 6 to 7:30 p.m.

 

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As The Valley Reporter goes to press on December 11, 2024, the meeting is still scheduled. If weather/flooding impacts the meeting, it will be remote and held via Zoom. Find the Zoom link on the district website.

There’s good news and vague news when it comes to this year’s preliminary budgeting efforts. The board is working on a budget that increases 2.75% which is less than the cost of inflation.

COST PER PUPIL

That 2.75% increase will mean a FY2026 budget of $49,209,927, an increase of $1,317,054 over last year’s budget. To achieve that budget, the board is cutting $2 million from the budget while accommodating negotiated increases in salaries and benefits that amount to $1.6 million.

This year state revenues for the district are increasing from $7,516,591 to $8,027,032. That revenue, and current estimates for the number of equalized pupils and cost per pupil reduce the 2.75% increase to a 2% increase.

District financial director Lisa Estler told the board at its December 4, 2024 meeting that on paper, and currently, those numbers look like a double digit increase in tax rates, but, she said that is before the state factors in changes to the Common Level of Appraisal. The Common Level of Appraisal is a measure of how closely a town’s real estate values track with 100% of fair market value.

TAX INCREASES

This year, Estler said, the state is using statewide adjustments to each town’s Common Level of Appraisal (CLA) to reduce education tax increases. That is made possible, in part, by the state infusing $33 million into the education fund this year. Last year the state added $70 million to the education fund to offset what turned about to be 15% average increases across the state.

Estler told the board that with the state’s adjustment of CLAs by 72% across the board, local CLAs will yield lower tax increases this year. Estler said that before factoring in the state’s revised CLAs  local taxpayers were facing what looked like an 18% increase in the tax rate to 1.81 but after that CLA adjustment and other state calculations, that increase drops significantly to an estimated $1.234, a drop of 17.1% over last year, she said.

 

 

 

SMOKE AND MIRRORS

“It’s a bit of smoke and mirrors,” Estler said.

“Once the new CLAs are applied, town by town, to our district we’ll be able to compare apples to apples in terms of tax rates,” she added.

The state’s annual education letter to school boards projects an average increase this year of 5.9% in education taxes, and board members asked Estler to project where the local tax rate will fall next to that average. Estler pointed out that the district’s decrease in spending, increase in state revenues, consistent enrollment numbers and these CLA changes should be very reasonable tax rates this year, but she declined to speculate on a number until more of the variables have been clarified by the state.

CLA NUMBERS

Here is how the CLA numbers look for the coming year.

Duxbury: FY2025 CLA was 68.43% and the state projected 65% this year. The new adjusted CLA for Duxbury is 90%.

Fayston: FY2025 CLA was 71.01% and the state projected 55% for this year. The new adjusted CLA for Fayston is 76%.

Moretown: FY2025 CLA was 66.97% and the state projected 104% for this year (Moretown completed a reappraisal last year). The new adjusted CLA for Moretown is 144%.

Waitsfield: FY2025 CLA was 66.85% and the state projected 58% for this year. The new adjusted CLA for Waitsfield is 80%.

Warren: FY2025 CLA was 61.3% and the state projected 53% for this year. The new adjusted CLA for Warren is 72%.

Waterbury: FY2025 CLA was 66.07% and the state projected 57% for this year. The new adjusted CLA for Waterbury is 79%.

TAXES COME DOWN

The higher a town’s CLA is, the less impact tax increases have. For example, in a town with a CLA of 53%, a home appraised at $100,000 would need to be trued up to an appraised value that is 47% more to determine the tax bill. (That is before income sensitivity.)

“Remember, when CLAs go up, taxes come down as properties are appraised closer in value to 100% of fair market value,” Estler explained.