Town tax rate shifts with stormwater utility passage

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The Colchester Selectboard approved a tax rate last Tuesday far lower than the one estimated on the Town Meeting Day ballot, primarily due to the recent creation of a stormwater utility.

In a unanimous vote on June 27, the board set the fiscal year 2018 rate at about 53 cents per $100 of property value, a 3.11 percent decrease from FY17.

Assistant town manager and CFO Aaron Frank told the board the owner of a $300,000 home, the average in Colchester, could expect to see a municipal tax bill that is $50.76 lower than last year.

But as selectboard members quickly pointed out, most residents will receive a separate bill for a $52.39 stormwater utility fee later this year.

“To say that it’s a reduction for a $300,000 home is not true,” selectman Tom Mulcahy said, noting the sizeable tax decrease for that homeowner would become a slight increase when the stormwater fee is factored in. “They have to be mentioned together.”

“But, in the end, you’re going to get cleaner water,” town manager Dawn Francis countered.

Indeed, the new utility increases water quality resources by about $333,000, according to town officials. Francis said the money is needed to meet ever-growing state and federal clean water mandates.

In an April interview, public works director Bryan Osborne said the utility revenue will allow officials to repair or replace failing drainage, to install systems where none exist today and to pay for improvements along gravel roads.

Funds primarily come from tax-exempt properties like St. Michael’s College and Camp Johnson, Francis said. Those organizations previously did not pay into the total, despite creating stormwater runoff.

“When we set about studying whether or not we should do a stormwater utility … we wanted it to be relatively cost neutral to the taxpayers,” Francis said. “We’ve achieved that for the most part.”

The new system aimed to make contributions more equitable, Francis said, using a property’s estimated contribution to the town’s runoff to determine the fee, rather than their assessed home value.

The owner of a $150,000 home, for example, will see a total increase of about $27 between FY17 and ’18, according to a town handout, while a resident with a home worth $450,000 would see a decrease of $23.75.

“As a result of the stormwater utility, it’s going to be more fair and equitable for all land users,” Francis said.

Lawmakers in Montpelier weighed the possibility of forming a statewide stormwater utility under the Clean Water Initiative this session, but ultimately decided to delay action, Francis said.

Town staff members were active in those discussions, she said, hoping to make sure residents in Colchester wouldn’t be taxed twice if a state system emerged. Burlington, South Burlington and Williston also have stormwater utilities, Osborne said.

In addition to the stormwater utility, a memo from town assessor Robert Vickery shows changes to the grand list also impacted the FY18 tax rate.

Major projects not “known, permitted or anticipated” at the time of the January estimate include nearly $77,000 in infrastructure improvements at Vermont Gas and several new single family homes, notably in the Brigante Woods development and along Bay Road.

The Mongeon Bay property, located on East Lakeshore Drive, saw a value decrease of $45,189, according to the memo. The owners of the year-round and seasonal camps were evicted earlier this year after a highly-publicized decision from the Vermont Supreme Court.

All tax bills will contain an insert explaining the new stormwater utility fee that will be forthcoming later in the year, Francis said.

A searchable database detailing the tax change for every property in town can be found at http://bit.ly/2oyduHS.