Financially speaking, the town of Brattleboro has acquired a champagne appetite on a beer budget. With the recent funding of the high school renovation, the Transportation Center construction, wastewater plant upgrades (separate budget), and now the police/fire renovation, the costs in association with these projects have been borne mainly by the taxpayer because of the underperforming Grand List.
The result is the second highest effective combined school and municipal tax rate for Homestead property of the 262 towns in Vermont and the fourth highest for non-residential property. To make matters worse, Brattleboro has a relatively low per capita income at $19,554 which ranks 125th of the 282 towns in Vermont, a fact which exacerbates the effect of higher taxes. These taxes rob everyone of disposable income, impair marketability of property, jeopardize retail sales and discourage investment in residential and commercial property in town.
The town is definitely in a financial sticky wicket so where do we go from here? Whether we are talking about a municipality or a household budget, there are traditionally two ways to improve financial health and they are to cut expenses or grow revenue, or some combination of both. Let us discuss expenses first.
The Selectboard, the town School Board and Town Meeting Representatives need to scrutinize budgets more than ever. Is the program valid? Should it be publicly funded? Just because it has always been there, is it necessary for the future? New projects should be put on hold until compensating revenue is found. Major capital projects should only move forward with a town referendum. Town Meeting Representatives often discuss small dollar politically sensitive projects for hours while approving major budget items in seconds. Does this make any sense at all?
On the revenue side, I earlier stated that our Grand List is underperforming. What I mean by this is that there has been totally insufficient growth in recent years to begin to offset the enormous increases in expenses so the brunt of the burden has been passed on to the taxpayers. Several commercial-industrial properties have closed resulting in dramatically reduced assessments (millions of dollars) and the burden of these losses has been transferred to the homeowners. There are huge numbers of exempt and partially exempt properties within Brattleboro. The town is limited geographically by our borders and the Connecticut River, a great resource, but a border. We also have property which is protected from development and economic activity which has been modest, at best.
The best way to grow revenue is to grow the Grand List. All exempt properties should be approached and asked to pay something "in lieu of taxes" because of the compelling financial needs of our community. It may just be for one year or five but the needs of the community far outweigh the needs of each exempt property.
Partially exempt properties such as "Affordable Housing" should be capped. Proponents of affordable housing will say that the projects do good for society by helping those less fortunate and that the projects dramatically improve blighted properties. I agree but I would counter with the fact that these properties only receive assessments at 60 percent of fair market value which hurts the grand list, long term. Also, these investors receive large personal tax breaks in the form of credits and deductions. I also question whether all these rentals are good for the town as Brattleboro has a high ratio of rentals versus homeowners, arguably an unhealthy measure for any community. The town should consider tax breaks for first time homeowners to reverse this trend.
Another way to grow the Grand List is to reinvigorate and reorganize all economic development within the region. Anemic groups such as Building a Better Brattleboro and other special groups should be governed by a parent like the new Brattleboro Development Credit Corporation affiliate SeVEDS, or the Brattleboro Area Chamber of Commerce, to promote a strategic and unified approach to economic development in the most cost effective manner.
In addition to growing the Grand List, the town must consider other potential sources of revenue. Perhaps the most obvious is that Brattleboro is an economic hub where thousands more people work than reside here. But for the town's infrastructure and related services, there would not be the businesses. Could we go to Montpelier to assert the economic hub argument to hopefully qualify for more monetary aid for large capital projects? Could we assess those workers a small tax on earnings for the benefit of the municipality?
There is the local option tax which could raise over $600,000 annually. Proponents say that it is all that is currently available through the State of Vermont to help the municipality. Opponents say that is extremely bad for retail especially because Brattleboro is so close to non sales tax New Hampshire. This is a democracy so have a townwide referendum on the issue and either do it, or, put it to rest.
As a life-long resident of Brattleboro, homeowner and business owner, I have a special love for this place we call home. I also have a great concern for the economic health of the town and I hope that you all realize the significance of our problems. We need to take action now, to improve things down the road.
Hugh Barber is a former president of the Brattleboro Development Credit Corporation and a former chairman of the Selectboard.