Oxford plans for 3 percent budget increase

OXFORD —  Taxpayers should expect a bigger budget this year, but town officials say they will do their best to keep taxes flat.

During its meeting February 7, the board of selectmen directed Town Manager Michael Chammings to move ahead with a goal of a 3 percent appropriations increase in the 2013-2014 budget.

According to Chammings, the uncertain impact of Governor Paul LePage's proposed 2014-2015 state budget, the SAD 17 school budget and other pending legislation made accurate budgeting difficult.

The town wouldn't know the impact of the changes for another several weeks, at least, Chammings told the board, but the town office was anticipating a drop in revenues, principally from a proposed state appropriation of commercial excise tax and a cut to municipal revenue sharing.

Although nothing was certain yet, Chammings expected Oxford, like other towns, would feel the pinch.

"Best case scenario, we're going to take a loss, we're going to take a hit," Chammings told the board.

In an interview Monday, Chammings said the town office was trying to keep property taxes flat, but firm projections were difficult.

"Like I told everybody two or three years ago, our taxes remain flat or go down unless the schools or the state does something radical," Chammings said.

"Well guess what, something radical happened."

Homeowners could see a tax increase regardless of the budget, Chammings said – the governor's budget excludes some homeowners from a property value exemption, which means a bigger tax bill.

Property tax exemptions for business owners could also shift the burden of taxation onto homeowners, Chammings said.

As a result, people might see an increase in their tax bills even if their municipality made budget cuts, according to Chammings.

"Theoretically, you could keep your budget flat, or even lower the budget in the town and still have homeowners see an increase in their property taxes," Chammings said.

As the town grew and more businesses moved in, people should expect the budget to grow also, Chammings said, but budget increases would be offset with new revenues. The budget increase itself, therefore, might not be directly reflected in a tax hike, but with the combination of state and school budgets, residents should expect a hit.

Uncertainty about the proposed state budget was making budgeting for towns across the state difficult, according to Chammings.

"It's probably the worst year I've ever seen for doing a budget and trying to project out where we're going to be," Chammings said.

"This definitely has the makings for being one of the worst years for local governments."