Being a hub town, Brattleboro looks for alternative revenue
BRATTLEBORO — The burden of infrastructure costs was behind the town's smaller-than-requested contribution to a regional economic development group.
Instead of giving $3 per resident as other towns did, Brattleboro gave only $2. Town Meeting Representatives approved of the move after hearing Select Board Chairman David Gartenstein's reasoning and Town Manager Peter Elwell's plans.
"Brattleboro's property owners are burdened by steep municipal property tax rates, which are among the highest in Vermont," Gartenstein wrote in an analysis provided before annual Representative Town Meeting. "A strong argument can be made that Brattleboro's property owners are called upon to pay more taxes than would otherwise be necessary for a town with its level of population because it funds municipal services necessary to support much of the region's economic and social service activity, but Vermont's current system of taxation does not enable the town to recoup those costs proportionately from those who benefit from the services. Some of this can be explained by changes in the nature of economic activity over time and the system of taxation not adapting."
While the town has about 12,000 people living in it, Gartenstein said the size of the town "swells" by day when thousands more come to work, attend school, shop or receive health care services. But property owners in Brattleboro are paying to fix roads and bridges, and keep emergency service departments staffed.
The Brattleboro Regional Economic Hub Study Group, formed in early 2014, went to Montpelier to discuss the issue in March 2014. A bill to create a study committee on property-tax variations then was introduced but did not pass.
And Gartenstein had spoken of establishing a payroll tax or some other sort of revenue stream while campaigning for the Select Board seat he just won, pointing at neighboring town tax rates that were less than half of Brattleboro's. His analysis showed fiscal year 2013 rates of $0.28 for Dummerston, $0.35 for Jamaica, $0.43 for Newfane, $0.48 for Vernon, $0.50 for Townshend, $0.51 for Wilmington, $0.61 for Putney, $0.62 for Grafton, $0.65 for Whitingham, $0.67 for Halifax and $0.68 for Guilford. These rates, based on every $100 of assessed property value, were compared to Brattleboro's $1.14 that year.
In 2012, SeVEDS received a matching grant of $50,000 from Brattleboro. The first $25,000 was given immediately. The other half was contingent upon raising another $50,000 from other municipalities in Windham County. Since then, the group has kept raising funds by requesting the $3-a-head.
Bob Stevens, chairman of the Southeastern Vermont Economic Development Strategies board and Town Meeting Representative, said SeVEDS hasn't responded to the reduced funding from Brattleboro. His group looks at expanding the amount of jobs and improving the quality of jobs around Windham County.
"Personally, I think we're sympathetic to the regional hub. But it's also a difficult issue to deal with," Stevens said. "There's no question, towns that are regional hubs are paying more for the cost of infrastructure than in the past."
He recalled the late 1980s and early 1990s when bedroom communities felt they had more of a burden than hub towns because their population was growing so their school systems and infrastructure had to accommodate for that.
Since then, a commercial tax base went down and the residential tax base increased.
"That's why there's this shift," Stevens said. "It's really because the economy isn't working. We need to have an economic system that works. The commercial value of properties will go up relative to where they are and by default pick up some of the tax burden and that will relieve the taxpayers."
On how to address the hub-town dilemma, Stevens said thought should be given to businesses. Understanding they are using services but not paying for them, he also sees how Brattleboro is always competing with other regions for company location. If a payroll tax makes the price of doing business higher, he said that's another reason for people to go to New Hampshire.
There could be creative ways to tap into user fees, Stevens said.
"What's good about this is the town has identified a problem and they're going to start a conversation. We at SeVEDS will probably weigh in," he said. "I think it's really the beginning of the conversation at this point. I don't know I'm ready to jump to the solution."
The town's Regional Economic Hub Study Group has started meeting again. A report was submitted to the Select Board on March 8.
The cost burden, classified as the town bearing a disproportionate share of governmental expense in the region, is partially but not completely offset by advantages, the report stated. Recognition of this is half the battle. The other half has to do with finding additional revenue sources.
"For right now, the focus is on organizing the coalition of towns to get together and explore ideas together," said Town Manager Peter Elwell. "We've begun that. We had informal communication with some of the larger towns in Vermont. Within the next few weeks, we expect to have the first meeting."
Elwell hopes to see the coalition meet in May. He said he thinks there are opportunities to learn from other towns on how to cope with the current situation, and getting together with those communities will allow the coalition to identify a common set of challenges and a common interest.
So far, Springfield, Rutland and Barre have shown interest. More cities and towns, considered to be centers of economic activity, will be consulted as efforts move forward.
Legislators have not yet been drawn into the efforts.
"Because at this point, it's not well-defined," said Elwell.
The topic will likely pop up on an agenda in May as the board has asked for regular updates. Elwell said the group is happy to do so.
"We think it's important to do that so the community stays current on how this evolves," he added.
Contact Chris Mays at email@example.com or 802-254-2311, ext. 273.
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