MERIDEN — A combination of cuts and alternate revenues, including a hike in the motor vehicle tax and cashing in on green energy projects in the city, are being used to offset a more substantial residential property tax increase in the proposed budget.
”It doesn’t change the cost of the budget, but it does reduce the part that is coming from your residential homeowners and your personal property,” Finance Director Michael Lupkas said.
Acting City Manager Ken Morgan’s original proposed $197.4 million budget called for a 42.76 mill rate, however, after weeks of combing through the budget, the Finance Committee voted Tuesday to send a $197.3 million spending plan to the full City Council. That proposal includes a suggested 42.28 mill rate. One mill is equal to $1 in tax for every $1,000 of assessed property value.
Spending cuts include a custodian for the library, a part-time clerk for the purchasing department, a $75,000 reduction in the snow budget, a $50,000 cut from the contingency fund and trimming $25,000 off funds earmarked for the state mandated Plan of Conservation and Development.
Despite the cuts, the total spending would only drop $100,000 from Morgan’s original proposal. The mill rate, meanwhile, saw a disproportional decrease due to $1.4 million in additional revenue from motor vehicle taxes, the Archimedes screw project at Hanover Pond dam and various solar panel projects in the city.
“It’s 1.4 milllion less that has to be raised by taxes,” Lupkas said.
The motor vehicle tax rate was previously capped at 39, however the state removed the restriction and will allow the city to raise the rate to 42.28, equal to the property mill rate.
Meanwhile, the Archimedes screw, which has not generated power since a malfunction in February, is slated to generate $36,000 in revenue for the city in the form of electricity rebates. Officials from the Connecticut Green Bank, which financed the project, anticipate the hydroelectric dam will be back online sometime this summer.
Likewise, solar projects throughout the city are projected to generate $191,000 in revenue, Lupkas said.
Although city clerk fees are not increasing, Lupkas anticipates an uptick in fillings to continue and has budgeted a $167,325 in additional revenues from that department.
“It’s a straightforward budget with no gimmicks,” Lupkas said. “A budget that can be lived with.”
While the mill rate calculation is based on the revenue necessary to fund the budget, Morgan said many unknowns still remain when it comes to state revenues.
“It’s kind of up in the air right now,” Morgan said. “We’re projecting where we think we’re going to be but without state numbers it’s going to be hard to narrow it down.”
Morgan hopes more concrete numbers will be available from the state before the City Council adopts a budget May 7.