Senate committee hears amendment to smooth tax-rate setting for new school district

The Senate Ways and Means Committee held a public hearing on Amendment 2214s on a technical change to how property tax rates are set for a newly formed school district.

The amendment, presented by Senator Innes and described in detail by Dan Ennis of Bradford, would create an exception to a statutory formula that limits taxes by member towns to the prior year’s assessed valuation multiplied by half of the previous year’s rate. Ennis said the formula creates “a little bit of a problem” for the newly formed district because the valuation and rate baseline will change substantially, producing an unexpectedly large bill for residents later in the year.

The change is intended to allow officials to set an initial tax rate that “will truly represent the Pass Esquanee School District and equalize that tax rate on both halves,” said Russ Holden, who identified himself as superintendent of the Pass Esquanee School District, SAU 108. Holden said the three towns involved — Bridgewater, Hebron and Groton — voted last year to form the new district under a statute referenced in testimony.

Adam Denonpour, assistant director of the municipal and property division at the Department of Revenue Administration, told the committee that DRA helped draft the amendment and “we are good with the implementation. We can administer it as written.”

Committee members asked no further questions, and the committee closed the public hearing on Amendment 2214s. No formal committee vote on the amendment was recorded at the hearing.

Background: testimony referenced a statute passed last year (recorded in the hearing as “18 3 49”) that authorized the three towns to form the new district. Witnesses said a missed deadline in the tax-rate setting process created the problem this amendment seeks to fix; the amendment’s proponents said it would prevent residents from receiving a normal bill followed by a substantially larger bill in December.

The committee record indicates DRA expects to be able to implement the amendment if enacted; the committee took no further action on the amendment during the session recorded in the transcript.

Details: the schools involved are identified in testimony as the Pass Esquanee School District, SAU 108; member towns named in testimony were Bridgewater, Hebron and Groton. The amendment was described as changing the basis used to establish the first tax-rate calculation for the new district so that the rate reflects the district’s structure rather than applying the prior district’s formula.