PORTSMOUTH — The Town Council on June 26 is expected to formally approve a $61.86 million budget for fiscal year 2017-2018 that adds about $1.2 million to the current spending plan but also lowers the tax rate by 58 cents, mainly due to the recent town-wide property valuation.

The council presented a line-by-line overview of both the municipal and school budgets to a sparsely attended public hearing Wednesday at Town Hall. One of only three taxpayers who commented on the budget, Larry Fitzmorris of Portsmouth Concerned Citizens, said he counted only “six civilians” in attendance.

As the budget stands now — the council could still make minor adjustments before it’s formally adopted — the tax rate would drop from the current $16 per $1,000 of assessed valuation to $15.42. That reduction will be offset, however, by the fact that property values have increased by an average of 8 percent under the recent town-wide revaluation.

According to Council President Keith Hamilton, property values increased “anywhere from 1.5 to 10 percent depending on your property, where you’re located, what your neighborhood is doing.”

The tax rate for motor vehicles under the proposed budget is $22.50, the same as in the current spending plan.

The budget includes a total of $38.1 million for the School Department, although that figure was listed at $36.53 million on Wednesday’s agenda and on the budget posted on the town’s website at the time of the meeting. 

The discrepancy was noted by Mr. Fitzmorris, who said he had already spoken to finance officials about correcting the figure. “The council, in the interest of transparence should be recording all the monies reported by departments,” he said.

Chris DiIuro, the school district's director of finance and administration, agreed that the higher figure should be listed as the bottom line — a difference of about $1.56 million. The main reason for the discrepancy, he said, was that the tuition paid by Little Compton students who attend the high school was not included in the total sum. 

Mr. Hamilton said the tuition figure was included in the revenue portion of the budget, but had not been broken down as a separate line item. He said the town should check with the state auditor general to make sure the numbers are being reported correctly.

“The revenue and expenditure should match,” he said.

Supporting the schools

Council member David Gleason was the lone dissenter when the provisional budget was approved by the council May 10 in a 4-1 vote. (Two members were absent that night.)

At the time, Mr. Gleason said while he’d been supportive of the school district’s budget requests in the past, he believed the increase of about $450,000 in the town’s appropriation to the schools could be smaller since the district has run a surplus for several years.

On Wednesday, however, Mr. Gleason said he had since met with Mr. DiIuro and Superintendent Ana Riley. “I was really satisfied with what they told me and I’m now supporting the school budget,” Mr. Gleason said.

Salary, benefits

Mr. Fitzmorris also questioned what he believed were big increases in salaries and benefits for municipal departments, totaling $15.4 million in the new budget.

Salaries and benefits rose by 8.5 percent last year and 5.2 percent this year, while the inflation rate increase over the past five years has averaged only about 1.3 percent annually, he said. The town has been able to avoid a large tax hike despite the salary increases because of new properties being added to the tax base, Mr. Fitzmorris said. 

“At some point, however, we’ll see another rough spot in the economy” and property sales will drop off again, he said. “Our salaries and benefits are too high.” 

Mr. Hamilton responded that health benefits are “the primary driver” for the higher numbers, while salaries themselves are going up about 2 percent. The town has been doing a better job lately in negotiating labor contracts to get employees to pay more into their health care plans, he said.

Council member J. Mark Ryan added: While the annual inflation rate has increased an average of about 1.3 percent over the past five years, the cost of health insurance has gone up about 5 percent annually during that same period.

More development needed

Local resident John Vitkevich said he was happy with the job officials did on the new budget, but they need to find ways to attract new development to Portsmouth to lower the tax burden.

“We have to get more people to invest in Portsmouth,” said Mr. Vitkevich. “We need more income, outside the residential tax base, to continue to have the success we’ve had in this community for the 43 years I’ve been here.”