By Paul Conyers
During the April 11 Town Council meeting, members and the public expressed concern over the taxes paid by older residents. There are concerns that the current tax brackets have not been adjusted for inflation.
Councilor Joe Green has expressed a desire to reform exception caps for the elderly. Under the current system, an unmarried elderly resident of Londonderry making up to $40,800 has an exemption with the rate at $50,300 for married couples. Green proposed a discussion on how to raise these limits without a negative impact on the town budget. He further stated that “as prices continue to increase past Covid, these numbers are a little bit low.”
Another suggested reform was in reexamining a law regarding members of the elderly community with a deceased spouse. Under current rules, only a living married couple falls under the higher exemption rate. A widowed individual receiving two pensions is considered single, with the $40,800 exception cap.
In public comments, resident Joan Chmielorz spoke at length about the personal impact of the current tax burden. Chmielorz described giving “every cent” of her federal tax refund back to town in July.
She also described needing to borrow $375 from her grandson. “I am begging you because I think I’m going to have and sell my house and leave, I am begging you, to think about the poor people…this is killing me.”
Councilor John Farrell explained a few possible difficulties with tax reform. He noted that “23% of [the budget] runs the town, and 75% of it runs the school.” State law prevents the Council from pulling any money out of the school system, limiting possible options.
One suggestion was asking the School Board to look into education funding. Despite having fewer students, funding levels have remained the same. Maintaining the financial safety of Londonderry is a central goal.
Any new tax exemptions would need to come out from the smaller, town side of the budget. Existing concerns include maintenance for public buildings and more funding for public safety employees. Londonderry is also below goals to rebuild the undesignated town budget. The alternative to make
Despite concerns over where to find the money, the Council has pledged to discuss possible solutions for tax reform. Unexpected revenue from the federal government and unspent budget money provides some possible solutions to the issue.
Green proposed changes “without any tax impact” using unexpected revenue sources and leftover money from other projects. He asked Finance & Administration if it is possible to use “tight analysis” and “to pass on tax rates and elderly exceptions to people who need them.” Acting City Manager Michael Malaguti advised that tax credits are possible with the current budget surplus, though not necessarily a good idea.
The discussion remains open on when and how to change the law without impacting the budget. Tax reform will be revisited in the next public hearing.
Veteran taxes public hearing is May 9th