BERLIN– Town officials this week introduced an unchanged tax rate but appear to be considering an increase to balance the budget.
On Monday, the Berlin Town Council held a first reading of the fiscal year 2024 real estate tax rate at 81.5 cents per $100 of assessed value. Mayor Zack Tyndall indicated a tax increase could be coming, however.
“I would not get your heart set on 81.5,” he said.
Tyndall said Monday that the town’s tax rate had been advertised as consistent with the current 81.5-cent rate. He noted that the town’s proposed budget currently had a substantial deficit, however, and that health insurance rates were not yet finalized. Finance Director Natalie Saleh said the budget currently had a $325,000 deficit.
“It’s still a draft,” she said.
Tyndall said officials had worked hard to reduce the shortfall.
“We started at a much higher deficit,” he said.
Staff said health insurance rates would likely come in about $50,000 less than budgeted, which would shrink the deficit some. Tyndall said he felt rather than introduce a tax rate the town should delay the first reading until officials knew what the tax rate should be.
“I don’t think we’re at the spot this evening to put a number in that blank,” he said.
David Gaskill, the town’s attorney, said the ordnance could be introduced with the current tax rate and officials could change the number after the public hearing. Tyndall said he didn’t want to mislead anyone.
“I’d say we hold off,” he said.
Saleh said that would impact the entire budget process.
“That’s going to put us in a jam,” she said.
Councilman Jack Orris said he didn’t want to hold up the entire process. When Tyndall said he still felt further discussion was necessary, staff said the tax rate could be added to the agenda for the town’s April 17 utility fund budget work session.
Councilman Steve Green said that was a good idea, as officials should have a conversation about the tax rate before the public hearing. He said he hoped council members could come up with ways to address the deficit.
“I think it needs to be multi-pronged,” he said. “I’m not for slashing everything.”
Green added that if the council discussed the tax rate next week it would give citizens some idea of what to expect.
“I think our public should know the intentions of this group prior to the public hearing,” he said.
According to figures provided by Saleh, the current tax rate will bring the town an additional $274,839 in the coming year because of the increase in assessments. If the tax rate was increased by one cent, to 82.5 cents, the town would receive $326,365 in additional revenue. A two-cent increase would bring in $377,891.
Currently, for a $400,000 home the tax bill would be $3,260 at the 81.5-cent rate. If the tax rate was increased by a penny, that bill would go up $40.
