Charlestown owes Fall Mountain money, town will pay SAU when taxes come in

By PATRICK ADRIAN
Special to The Eagle Times
CHARLESTOWN —The Charlestown Select Board said on Wednesday that, due to low available revenues, the town owes about $1.2 million in monthly contribution payments to the Fall Mountain Regional School District (SAU 60), but it will wait until tax collection in mid-December to catch up with payments.

Charlestown pays its portion of SAU 60’s annual operating budget in monthly installments of $604,000, totaling about $7.2 million for the 2018-19 school year. Selectman Thomas Cobb said at Wednesday’s select board meeting in past years, when the town had revenue shortages before tax collections, the town paid the school district through tax anticipation notes, a state-issued credit with low-interest rates to municipalities. This year, however, the select board intends to manage its budget without tax notes. 

Months ago the select board asked the SAU 60 school board, Superintendent Lorraine Landry, and Chief Financial Officer James Fenn for more payment schedule flexibility, in order for Charlestown to avoid using tax anticipation notes.

“They said no problem, we just need to be paid up in June,” Cobb said. 

Cobb said that he notified the SAU in October that the town would not be sending payment for that month and would need to wait until December, when tax revenues began being collected. In November, however, the SAU began sending emails to Charlestown requesting payment.

“Whatever the reason is speculation, I suppose,” Cobb said. “Nonetheless, they decided they needed their money.”

Cobb said the select board remains adamant about not taking a tax note in order to make payment.

“We made a deal with them,” Cobb said. “When I tell you something, I mean it, and I hope you mean it as well. We didn’t put a lot of money under our interest line for our budget last year, so we are not taking a [note] to pay that bill.”

Earlier on Wednesday Charlestown sent SAU 60 a partial payment of $100,000, Cobb said, and announced publicly that the town will be able to pay the remaining $1.2 million balance by Dec. 15, 2019 at the latest. 

While putting aside the total amount needed to make monthly school contributions would be ideal, many towns cannot afford to operate that way, Cobb told the Eagle Times. 

There is approximately $1 million in uncollected tax revenue in Charlestown, for example, from unpaid tax bills or other reasons, Cobb said. Towns have to manage their needs month to month. Charlestown currently has around $575,000 in reserve funds, which is much less than what it owes the SAU. 

In spite of that, Cobb is pleased with Charlestown’s fiscal management this year. 

“We managed our budget very well this year,” he said. “Not once have we had to take a tax note.”

Attempts to reach Superintendent Landry and James Fenn yesterday for comment were unsuccessful.

Also on Wednesday, the select board discussed their ongoing differences with the Fall Mountain School District over its funding formula and similar issues. Selectman Albert St. Pierre said that the district is currently proposing a $600,000 increase for the 2019-20 school, for which the Charlestown taxpayers would be responsible for $280,000.

In March Charlestown residents will vote on an article to fund a feasibility study to withdraw from the Fall Mountain school district. If approved Charlestown would operate its own school for students in kindergarten through eighth grade and contract with outside districts or other schools for high school instruction.