Hadley aims to use rainy day fund to keep next year’s taxes flat

  • David Nixon, deputy Hadley town administrator. STAFF PHOTO

Staff Writer
Published: 10/31/2020 2:18:03 PM

HADLEY — A proposal to put a sizable amount of the town’s rainy day fund into the $21.95 million municipal budget would ensure that Hadley homeowners and businesses have no increase in their property tax bills next year.

When voters convene for a special Town Meeting on the afternoon of Nov. 14, they will be presented a plan, developed by the Select Board, Finance Committee and town staff, that dips into the stabilization account so the tax rate can drop from $12.78 per $1,000 valuation to $12 per $1,000 valuation.

With the average home value in Hadley of $328,800 expected climb to $350,200, based on information from Assessor Daniel Zdonek, the reduced tax rate would allow the typical tax bill to remain at $4,202. Tax bills increased by an average of $187 last year.

Select Board Chairman David J. Fill II said he pushed for the zero increase in tax bills because it would help taxpayers across the board in the midst of the COVID-19 pandemic, from residents who may have lost paychecks to businesses that have had to temporarily close or alter operations.

“We can’t put taxpayers through this. We’ve got to help them any way we can,” said Select Board member John C. Waskiewicz II.

There are three prongs to the plan, said Deputy Town Administrator David Nixon.

First, residents will be asked to remove $375,000 from the stabilization account. This would be replaced next year by an equal amount that is being returned from the Hadley public schools budget and will become free cash.

Second, residents will be asked to take out an additional $155,000 from the stabilization account.

Finally, the town will see $175,000 in net savings through a process in which the town’s payments on principal debt above the tax levy will be deferred for a year, Nixon said.

Linda Sanderson, the town treasurer,  said even when using more than $500,000 in rainy day funds, Hadley will still have more than $1.5 million available in the account.

Select Board member Jane Nevinsmith said residents should understand that tax bills may have to increase by a more substantial amount in 2022 to make up for the lower burden from the bills that will go out in 2021.

But board member Joyce Chunglo said offering this sort of tax relief is important during the pandemic, with hopes that revenue to the town from sources such as meal and hotel taxes will rebound in the coming months.

Scott Merzbach can be reached at smerzbach@gazettenet.com.

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