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Tamworth board sets tax rate and authorizes $425,000 from reserves to hold down rate
Summary
After reviewing the Department of Revenue portal and revaluation impacts, the Tamworth select board voted to use $425,000 from the unassigned fund balance to offset the municipal tax rate, a move members said will keep the town rate close to last year's level.
The Tamworth select board set the town’s tax rate framework and approved using $425,000 from the unassigned fund balance to lower the municipal portion of the rate, the board said at its Oct. 24 meeting.
The municipal budget presenter explained the town began 2024 with an unassigned fund balance of $2,535,000, that the board had spent $279,000, and that the resulting unassigned fund balance stood at about $2,256,000 (roughly 17.6 percent of appropriations). "If we brought the unassigned fund balance down to something like 13%, in theory, you could use almost 1 to 700,000 of the unassigned fund balance," the presenter said while walking through examples in the Department of Revenue portal.
Board members discussed trade‑offs between using reserves to reduce the rate immediately versus conserving funds for capital needs such as bridges. One member said the 10‑year average use for tax‑rate smoothing is about $425,000, which the presenter also confirmed as near the historical average.
After discussion, a motion to apply $425,000 from the unassigned fund balance to offset taxes was made and passed on a roll call vote recorded as unanimous. One speaker summarized the decision: "425,000, it is."
The presenter ran model calculations showing how applying $425,000 would change the municipal portion and the overall rate; the board noted the revaluation increased town valuation to approximately $724,000,000 and explained how the revaluation shifts taxable‑dollar allocations among property classes. The board also reviewed the Department of Revenue Administration (DRA) portal, noting an initial tax effort of about $3,009,000 and that, without offsets, a DRA‑equivalent rate would have represented about a 3.69 percent increase.
Board members said they expect about $400,000 in unspent dollars to be added back to reserves before year‑end and discussed using a portion of reserves in both the current setting and the 2025 budget process. The board did not change its policy target during the meeting, though members noted the policy target range for reserves is 8 to 15 percent and discussed whether that guideline should be revisited.
The budget and tax‑rate adjustments will be reflected in forthcoming tax bills and the 2025 budget process.
