By Jason Rowe
Journal Inquirer
June 28, 2006

VERNON - For two hours Tuesday night, the Town Council tried to adopt a tax rate that would somehow reflect the results of the July 13 referendum on the proposed $70.7 million 2006-07 budget.

But after being told of the pitfalls of changing the tax rate after the start of the fiscal year on July 1, the council voted 9-0 to adopt a tax rate of 36.73 mills, a number that coincides with its fourth and latest budget proposal.

That tax rate reflects a 0.94 mill or 2.63 percent increase over the present tax rate of 35.79 mills.

Democrat Pauline A. Schaefer and Republican Mark S. Etre were absent from the vote and Republican Deputy Mayor Jason L. McCoy was not included in the tally because he was sitting in for Mayor Ellen L. Marmer, a Democratic, who also was absent.

Based on Vernon's average home assessment of $100,000, a resident would pay $3,673 in taxes, an increase of $94 over the current fiscal year.

Republicans called for Tuesday's special meeting to revisit a 7-5 vote taken June 20, shortly after voters rejected a third 2006-07 budget proposal, which would have set the tax rate at 36.78 mills, an increase of 0.99 mills.

If voters approve a budget that requires less revenue than what is generated by the tax rate, the excess revenue would be placed into a special reserve fund and used to offset the 2007-08 tax rate, officials said.

A number of Republicans were concerned that voters would feel disenfranchised if a tax rate were set before a spending plan was approved.

But Marmer and other town leaders have argued that the town needed to adopt a mill rate to raise revenue to pay the town's bills after July 1.

Because tax bills have not gone out, officials have said the town already has lost more than $100,000 in interest revenue.

During Tuesday's meeting, Republican Councilman Daniel E. Anderson proposed that the council set a tax rate of 35.79 mills, which represents the current fiscal year's tax rate.

And some council members surmised that if voters approved a budget that required more revenue, the Town Council could amend the mill rate at a later date and supplemental tax bills could be sent to homeowners to cover the difference.

But Finance Officer James M. Luddecke said such a plan has never happened in Vernon and he was unsure if the town's computers even had the capability to handle such a billing schedule.

He added that Stafford tried to do supplemental billing once and it was largely unsuccessful.

Tax Collector Carol S. Nelson also urged the council to reject the plan.

Nelson described a scenario where the town would have to pay postage and administrative costs to send out motor tax bills to residents for amounts as low as a nickel.

Nelson said the collection rate would likely be extremely low in this case, resulting in a significant amount of lost revenue - not to mention the cost of sending out the bills.

Keeping the current mill rate also would pose problems for a recently adopted senior and disabled-citizen tax relief program and the state's circuit breaker tax-relief program, she said.

"We don't know if it could be done," Nelson said.

After a lengthy discussion, Republican Christy N. Vale proposed that the Town Council set a mill rate based on revised budget figures set Monday.

And the remaining council members backed the plan.

"There is no good answer," Vale said. "The only good answers that keep coming up are spending more money, and spending more money foolishly. When I listen to what's going on around the table, there is no way we can work it out."

In arguing against adopting the 2005-06 tax rate, Democratic Councilwoman Mary A. Oliver said there could be serious financial consequences for the town.

"It's not right to emotionally take a left turn when you know you should be taking a right turn," Oliver said. "I think the council has been very conscientious and I don't think it's time to make a change at this point."