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Ellsworth finance committee weighs tighter rules for nonprofit grants and requests tax-exempt valuations
Summary
Members of Ellsworth's Finance Committee discussed setting limits on annual increases to municipal nonprofit grants, using memoranda of understanding for city-contracted services, and directed staff to compile tax-exempt property values and a list of grant applicants by stated deadlines.
Members of the Finance Committee for the city of Ellsworth discussed possible changes to how the city awards grants to nonprofits and asked staff to compile tax-exempt property valuations and grant-application materials for review.
The committee discussed two main reforms: (1) setting a cap or formula for year-to-year increases to the municipal grant budget for social services (examples mentioned included indexing to inflation or a flat percentage cap), and (2) creating a separate memorandum-of-understanding (MOU) process for nonprofit providers that deliver discrete, city-contracted services such as recreation or chamber services rather than general grants.
The committee chair, Tammy (chair, Finance Committee), said the city should “go in with a closed mind” on any change but emphasized that nonprofits should demonstrate they serve Ellsworth residents and that the timing may be premature to adopt a formal change this budget cycle. Nate (staff member) and Ashley (staff member) are collecting application materials: Ashley said, “The deadline again is Feb. 14. It’s outlined in the policy that we’re very strict on that deadline this year.”
Committee members also asked staff to assemble data on tax-exempt property within the city. One speaker reported a total of about $141,500,000 in fully tax-exempt property citywide, with roughly $45,500,000 in the non-governmental category; committee members cited an estimated annual tax-equivalent of roughly $800,000 tied to exempt properties. Committee discussion noted that much exempt property supports regional services and that measuring a single tax-equivalency figure would not fully capture the value of nonprofit services.
A public commenter, Jared from Union River Associates, urged caution about expanding nonprofit grants, saying 5% increases “don’t seem like a lot to the regular homeowner” and that longstanding local businesses bear a tax burden the city should consider.
On budget and schedule items related to the committee’s work, staff said department budget submissions were due Jan. 31 and that municipal bond-bank applications were due Feb. 5. School-related projects mentioned for bond-bank consideration included a $1,200,000 Avery Lane item and a $135,000 HCTC CTE grant. Staff also briefed the committee on audit logistics tied to a software transition to Cassell that splits the fiscal accounting period and may lengthen audit timing.
No ordinance or formal motion was adopted during the meeting. Committee members discussed forming a subcommittee to review nonprofit requests and consider whether to codify a cap on grant increases or to separate MOU-based payments for services provided directly to the city. Members said they expect to review the universe of applications once the Feb. 14 deadline passes and to continue the discussion in subsequent finance committee meetings.
Ending
Staff will compile the requested tax-exempt valuation details and the completed grant applications after the Feb. 14 deadline for the committee to review. The committee scheduled additional finance meetings and noted budgets and supporting documents will be posted online during the review process so the public can follow each step.
