By Ally Lanasa, Staff Writer

(March 11, 2021) Berlin Mayor Zackery Tyndall recommended to the Town Council Monday night that it maintain the property tax rate at 80 cents per $100 of assessed value from FY21 to FY22.

Currently, the town is projecting revenues of nearly $6.4 million and expenditures about $6.5 million.

The 80-cent tax rate is about two cents more than the state-calculated constant yield rate of 77.9 cents, which would bring in approximately the same revenue as last year. By opting to stick with 80 cents, the town would realize an additional $100,000 in tax revenue because of growth in the town’s tax base. Still, that increase would not make up the difference between revenue and spending.

“At this present moment with those rough numbers coming in, we do have about $130,000 deficit between those two numbers, the revenues versus the expenditures,” Tyndall said. “Despite the roughly $130,000 shortfall, I’m very confident that we can close that gap without having to increase the tax rate, without anyone being in jeopardy of losing their job and without cutting any of our critical services that we provide to the community.”

Councilman Troy Purnell asked the mayor how the tax rate of 80 cents was determined because of the numerous capital improvements needed.

“We didn’t have anything in the budget, and we cut the budget by 10 percent in the last two years,” he said. “Is there any way you can share the figures you’ve used to come up with this because you just said we’re $130,000 upside down.”

Tyndall replied that some of the requested capital improvements by town staff have factored into the deficit.

“We’re not going to be able to make up the years past ground all in one fiscal year, but there is a way that we are able to make some of the capital improvements that we need to make while still keeping within the tax rate,” he said.

With further requests to share figures, Tyndall told the council that town staff could share the real property tax calculations from Worcester County. However, the requests from the department heads are still in their “infancy” and further discussions with department heads were planned for this week.

“I think before we end up at the council adopting the tax rate, there will be some documentation that you’ll be able to base your opinion on,” Tyndall added.

Purnell replied that he wanted to see current documentation the mayor has that he based his opinion on to maintain the 80-cent tax rate. Tyndall offered to share the draft of the budget with the council.

Councilman Jack Orris asked why the tax rate is determined so early in the budget season.

“In the past, we’ve come to the decision to review the tax rate a little bit earlier than the workshop as a guideline or as a driving mechanism to see what the real estate tax revenues will bring to the general fund,” said Natalie Saleh, the town’s finance director.

She added that she would like to see a three-year plan for the tax rate.

“That’s definitely helping because knowing the revenue projections for the general fund is actually allowing us to know what capital projects we can structure,” Saleh said.

Responding to Councilman Jay Knerr, Tyndall said the tax rate is not tied to a balance budget, meaning he does not have to present a balanced budget to the council at the time the tax rate is set.

“So, you’ve had the privilege of seeing all these numbers. The council has not, so what were you thinking about cutting to balance this budget?” Knerr asked.

Tyndall and Saleh said department heads were asked to request only capital improvement projects that were truly needed. Those will be reviewed during discussions with department heads, Town Administrator Jeff Fleetwood, Saleh and the mayor.

“My professional opinion is to go with the incremental increase to close the gap and not to cut the projects,” Saleh added.

Furthermore, department heads will be integral in making the necessary cuts to eliminate the deficit in the budget.

Responding to Fleetwood, Saleh said expenses for FY22 are slightly higher than FY21 because of healthcare personnel costs. Fleetwood added that fuel costs have also increased so, a 5 percent inflation was included in FY22.

“To be honest with you, I hope that is a good target number because it has already proved me wrong before we even get into the year with what gas prices have done,” Fleetwood said.

In addition, Saleh prefers to gradually increase the tax rate every year to have a balanced budget and funding for projects without financially hurting Berlin residents.

The council could propose a different tax rate at the public hearing on the tax rate and the adoption of the tax rate scheduled for March 22, which will be an in-person meeting with limited public attendance.