Caribou councilors lower city’s mill rate after rejecting proposed budget decreases

9 months ago

CARIBOU, Maine — Caribou city councilors approved a 2023 mill rate of $19.50 per $1,000 of property value 5-to-2 Monday evening.

This is the second time councilors have voted on the mill rate, which comes after the city updated real estate market values. The market value adjustment lowered the expected mill rate, but some homes’ higher values will still lead to many property owners paying higher taxes.

The city council initially approved an 18.55 mill rate in July before learning of software errors in TRIO, which Caribou uses to calculate annual tax bills.

TRIO had been accounting for a 73 percent Homestead Exemption reimbursement instead of the accurate 76 percent, City Manager Penny Thompson said. Based on the correct percentage, the real mill rate should have been 20 mills.

Last month councilors voted to use $188,540 from the property tax relief fund to lower the mill rate to 19.5. In January, the council had placed $505,415 in state revenue-sharing funds into a taxpayer relief fund after receiving more revenue sharing than expected.

On Monday, Councilor Dan Bagley proposed many reductions in the city’s $10.5 million expense budget that would have reduced the mill rate to 19.3.

Bagley suggested reducing General Government from $860,871 to $854,371; the Nylander Museum from $53,903 to $48,503; General Assistance from $43,047 to $34,647; Caribou Public Library from $246,852 to $240,452; Police Department from $1,870,971 to $1,854,171; Recreation from $656,660 to $629,665; Parks from $198,997 to $193,997; Caribou Municipal Airport from $101,462 to $94,462; and Caribou Trailer Park from $13,455 to $7,155.

If approved, the reductions would have totaled $88,400, at least 1 percent of the city’s total expense budget, Bagley said.

“I think this is achievable and reasonable,” Bagley said. “This would reduce the overall tax increase for citizens from 17 percent to 15 percent. I know it doesn’t seem like much, but every little bit helps.”

The City Council voted down Bagley’s proposal 5-to-2. Mark Goughan and Bagley were the only councilors to vote in favor of the budget reductions. They also voted against the 19.5 mill rate that ultimately passed.

Councilor John Morrill said he did not want to see the city’s departments reduce their budgets more than they already have during negotiations with the council.

“There are three things that impact taxes: the municipal budget, RSU 39 [school district] budget and our county tax bill,” Morrill said. “I don’t see why it’s up to us to always take this burden.”

With a 19.5 mill rate, the city expects to receive $3,621,819 in property tax revenue compared with the initially projected $3,615,900. In 2022, the city received $3,613,806.

Caribou will receive $914,086 in revenue from Homestead Exemptions, $392,153 from Business Equipment Tax Exemptions and $747,801 from the Tax Increment Financing Districts, which give tax incentives to qualifying developers.

The council also set Aug. 17 as this year’s tax commitment date, with bills due Aug. 31. Interest will begin accruing on Oct. 1 at an 8 percent rate for any delinquent taxes.

The next regular Caribou City Council meeting will be held at 6 p.m. Monday, Aug. 28, at Caribou Municipal Building, 25 High St.