BOWDOINHAM — The town of Bowdoinhan has no definitive idea of what the tax rate will be if voters approve the proposed $2.18 million municipal budget for 2020-21 at the polls on July 14.
According to projections released by Town Manager Tom Woodin Tuesday, the tax rate increase could range from 0.3% to 4.7%. That would add between $10 and $156 to the tax bill for a home valued at $200,000. The projections largely depend on the amount of municipal revenue sharing the town gets, the portion of state tax revenue the state sends to towns to help with property tax relief.
The proposed $2.18 million municipal budget represents a $205,888 or 10% increase in spending through taxes. Woodin said as of April the state anticipated giving Bowdoinham $273,000 in municipal revenue sharing in the current fiscal year that started July 1.
Due to expected cuts as a result of the coronavirus pandemic, Woodin only budgeted for $220,000 in municipal revenue sharing, the same amount it received in 2019-20. That could increase the tax rate by 3.8%, or $126 for a home valued at $200,000.
Select board chair Tony Lewis requested voters reject the $164,839 capital reserve budget article to reduce the overall municipal budget in his July 1 post on a Bowdoinham community Facebook page.
Woodin said Tuesday he believes Lewis is the only selectman on the five-member board who has publicly made that request.
The capital reserve budget includes $111,339 the town saved in debt payments by refinancing nine of its bonds. The money was put in a capital reserve account to help the town pay for capital improvements without borrowing and raising taxes. Lewis states that this is a good approach to save the town financing costs on future projects.
“Unfortunately, with the unknown surrounding state revenue sharing, and the likelihood that it will be significantly reduced due to the economic downturn attributed to the COVID-19 pandemic, this increase in budget is likely to cause an increase in the municipal tax rate,” Lewis wrote.
Attempts to reach Lewis Tuesday were unsuccessful.
Cutting the capital reserve budget could result in just a 0.3% tax rate increase or a $10 increase for a home valued at $200,000 according to Woodin.
If the town gets only $200,000 in municipal revenue sharing, the tax rate could increase by 4.3% or $140 for a home valued at $200,000. If the capital reserve budget is eliminated, the tax rate could increase by 0.73% or $24 for a home valued at $200,000.
If the town gets only $174,000 in municipal revenue sharing, the town could see a 4.7% tax rate increase or another $156 on the tax bill of a home valued at $200,000. If the capital reserve budget is eliminated, the tax rate may increase by 1.3% or $42 for a home valued at $200,000.
Woodin said Tuesday there are too many variables for him to estimate how much in state revenue sharing the town is most likely to get from the state.
“It’s probably changing daily,” he said.
Selectmen were scheduled to hold a virtual budget information meeting Tuesday night during their regular meeting at 5:30 p.m.
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