COVENTRY – No matter how the coin is flipped, Coventry residents are either looking at a 3.5 percent increase in property taxes or vital services will be cut.
If they approve this year’s budget, that will mean a 3.5 percent property tax increase, which will raise the residential and tangible property taxes from $18.06 to $18.69 per $1,000 and the commercial tax rate from $21.76 to $22.52 while the motor vehicle tax will remain the same.
“It’s questionable what will happen if they don’t approve it,” said Coventry Town Manager Tom Hoover of the budget and the voters.
According to Hoover and Coventry Town Council President Gary Cote, the difference between the property taxes last year and what is being proposed this year is 63 cents.
Thirteen cents of that will go toward payment of the debt service for the school building improvement bonds, while the remaining will go toward the annual required contribution to the pension fund and to pay for the state mandated $300,000 for technology for students to take the required PARCC assessment over the next two years.
“This is the first property tax increase in four years,” said Cote.
The proposed levy is $64,625,926. If budget fails then Coventry would go back to the current levy of $62,327,613.
According to the report given by Hoover during his original presentation in March, which includes last year’s property tax amounts compared to this year’s proposed amounts, if a person’s home is valued at $200,000 then they pay $3,612 at the $18.06 rate. If the rate is increased to $18.69, then that tax bill increases to $3,738.
During a workshop held February 4 for members of the school committee, town council, town departments and members of the state delegation, Hoover said based on the results of the actuary report done by Milliman, Inc. as of July 1, 2011, the municipal employees pension system was only funded at 11.3 percent.
Anything below 60 percent is considered to be in critical status.
The actuary recommended a pension contribution of $1,068,188 to the trust based on a 22-year amortization with payments increasing 3.55 percent each year.
Hoover said it has yet to be determined what will be cut if the budget is not approved at the June 11 meeting.
The meeting will be held at the Coventry High auditorium at 7 p.m.