By Jon Decker
THE LACONIA DAILY SUN
Belknap County property owners could face a rise in taxes next year, according to data from the county commissioners’ Thursday budget workshop meeting. County property taxes are projected to increase by over 35%, while the total county budget is only expected to increase by 6.9%. The tax increase isn’t set in stone, and will ultimately be voted on by the county delegation.
“If your home is assessed at $300,000 using an average estimated tax rate, because every town is different, then the increase is $124 this year,” said County Administrator Debra Shackett.
According to data provided by the county commissioners, the tax increase is not a result of ramped-up spending, but a decrease in revenue.
The county nursing home is the primary revenue source for the county, and is currently only at 60% capacity.
“We are 11%” lower in county revenue than last year,” Shackett said. “It’s enough to hurt.”
The 2022 nursing home budget was $10.66 million. The projected department budget for 2023 is $8.64 million, a 10% decrease.
The nursing home is the primary revenue stream for the county, and has struggled to hire enough staff.
The county delegation, led by Rep. Mike Sylvia (R-Belmont), slashed funding to county services, including the nursing home, in the name of lowering taxes in January. The delegation, along with many before it, also dipped into the county’s fund balance to temporarily reduce taxes. Last year, the delegation used $2 million of the $4 million fund.
“It harms the taxpayer in the long run a lot more than it could ever benefit them in the short term by keeping the budget artificially low by tapping into those monies,” Commission Chair Peter Spanos explained. “It makes the cost of the county borrowing money much higher, because it reduces our bond rating.”
But what exactly is a fund balance?
According to the New Hampshire Municipal Association, a fund balance is “the difference between assets and liabilities resulting in a surplus or a deficit.”
The association’s website explains that the fund balance is not a cash account.
“Unlike a personal bank account, a general fund balance is not a ‘cash-account’; it is a measure of equity between revenues and expenditures,” as described on municipal.org.
A fund balance’s primary use is to offset taxes, especially in a situation where a county experiences a sudden catastrophic expense. That way, the county can dip into the fund balance instead of implementing a sudden tax increase to address the expense.
“That is for if something goes wrong, and we think, ‘Oh crap, we have a capital expense we weren’t expecting, so we can’t ask taxpayers for a million dollars,’” said Rep. Travis O’Hara (R-Belmont), who defeated Sylvia in this year’s Republican primary before winning reelection to his seat. O’Hara was one of two delegation members who attended the budget workshop.
“They used it as an artificial way to lower taxes. Me and Harry Bean sat down for a while saying, ‘This is going to bite us hard.’ He knew it was coming. We tried to tell them, and here we are.”
The election ushered in three Democrats to the county delegation, breaking the all-Republican hold on the group.
“The fact is, they’ve had to reduce the capacity [of the nursing home] because of the way the budget was manipulated,” said incoming Rep. David Huot (D-Laconia), who sat in the audience during the workshop. “That needs to be looked at very carefully. We need to be able to provide nursing home services to people in need. Maybe it’s necessary that taxes go up a little bit to take it.”
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