GRAY — Residents will cast another vote on the property tax levy limit Sept. 8, after their rejection of that part of the town budget in July scuttled enactment of the entire spending plan.

While other budget items on the July 14 ballot passed overwhelmingly, the spending limit article failed by 58 votes, 863-805. There were 136 blank ballots.

The number of blank ballots compared to the other articles on the ballot may indicate confusion over the spending limit article, which does not necessarily go to voters every year, said Town Council Chairman Sandi Carder.

“That adds to the confusion because voters see it sometimes and sometimes they don’t,” Carder said Tuesday. “The fact of the matter is without passing (it), we don’t have a budget that we can execute so a lot of plans and items are on hold.”

A property tax levy limit is the maximum amount of money a town can collect in property taxes in a fiscal year, based on a combination of expected revenues, state and local funding and expected growth of the town, in terms of taxable properties. A 2005 state law requires municipalities to calculate this number every year and put any increases before voters, even if the town does not expect to actually meet that limit in collected taxes.

There are several factors that go into the complicated formula to calculate the property tax levy limit. Because of this, an increase to the limit does not necessarily have an impact on the tax rate in a given fiscal year.

“There isn’t a straight line from LD 1 (the property tax levy limit) to the (tax) rate … We’re trying to get the word out to help clarify that even though we’re required to have the LD 1 question (on the ballot), there is a zero (tax) rate change,” Carder said.

The question on the September ballot is to increase the limit by $361,785 (last year voters approved an increase of $167,177), however, the tax rate will remain $14.75 per $1,000 of assessed property valuation, the same as the 2019-2020 fiscal year.

The $9.02 million budget is up about 4% over the 2019-2020 budget.

The increase to the tax levy limit is higher than the actual budget increase because the latter is just one factor in the calculation to find the tax levy limit.

Carder added that at the time of the July ballot, the council had not yet received information on state revenue sharing and could not yet say that the tax rate would remain the same as last year.

Residents will vote next month on the same limit they saw on the July ballot. Carder said an explanatory note on the ballot attempts to dispel any confusion. An explanation also was posted to the Gray/New Gloucester community Facebook page and the town has sent out a few email blasts directing voters to read the explanatory note.

Not all councilors are on board with this, however. In a response to the Facebook post, Councilor Sharon Young urged voters to reject the article again: “Wouldn’t it be absolutely wonderful to see taxes decrease while so many people are suffering from health and economic worries … We can defer some long-term wants, no matter how worthy and wise those wants are.” She specifically mentioned capital improvement projects.

When reached for comment Tuesday, Young said that she was speaking as a resident and not for the council.

“I want to see the municipality make wise decisions in how much they appropriate things, whether it be the capital improvement plan or any of the extras. I’m fiscally conservative that way,” Young said.

Carder said that her concern is that residents “did not give us additional direction where additional cuts would be (made).” The issue is not as clear cut as New Gloucester’s, she said, where residents voted down two specific budget items that they wanted changed.

The only way to decrease the property tax levy limit or keep it at its current level would be to cut the 2020-2021 budget to a number lower than last year’s.

A failure to pass the tax levy limit increase again means that the council will have to reevaluate the budget to make additional cuts, putting projects like capital improvements and a new town manager search on hold, Carder said.

Town Manager Deb Cabana is planning to retire in June of next year.

Carder said that passing the tax levy limit increase and keeping the budget as is allows the town to move forward with these items “so that it doesn’t cost taxpayers later.”

Voting will take place on Sept. 8 at the Newbegin Gym at 24 Main St. The polls will be open from 8 a.m. to 8 p.m.

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