Officials in Bow will continue to set money aside in the next fiscal year for the ongoing Merrimack Station tax litigation, but the municipal tax rate is expected to drop.
An early look at the budget that will come before voters at town meeting (March 13, 5:30 p.m., at Bow High School) shows the town’s portion of the tax rate will go down from the 2018-19 rate of $8.09 per $1,000 of assessed property value.
It’s still too early to tell precisely what the town’s portion of the tax rate will be because the final numbers have not been ironed out.
The budget committee slashed about $6,700 from the select board’s proposal, and those cuts have not yet been calculated in the budget. Even without considering those cuts, the town’s portion of the tax rate would fall about 3 percent, or about 40 cents off the previous tax rate.
“On our end, it’s a level budget,” Bow select board chairman Christopher Nicolopoulos said. “The town has benefited from growth and additional tax revenue, so when property values go up the tax rate can stay the same even though you’re generating a bit more money.”
The municipal tax rate has been climbing steadily for the last few years as the town and Eversource went to court over an overestimated valuation of Merrimack Station.
Last year, the state Supreme Court affirmed the town had overshot the assessment by about $92 million in the years 2012 and 2013. Merrimack Station was worth about $67 million in those years, as opposed to the town’s assessment of $159 million for those years, which was used to calculate Eversource’s tax bill to the town.
The town paid about $5.7 million for the principal abatement, more than the $5.5 million the court said the town had over-billed the utility. The town owed an additional $1.8 million in interest, which was delivered in two payments in April and July last year.
The money to cover that interest payment was included in last year’s budget as $1.892 million earmarked for legal services. About the same amount ($1.9 million) is in the town’s proposed budget for the 2019-20 fiscal year.
Bow’s school board is still negotiating a new teachers contract, and the overall tax rate could see an increase depending on how the school district’s budget shapes up.
School board chairwoman June Branscom said the board has kept in mind the ongoing litigation between the town and Eversource as it builds its own budget for 2019-20.
“We’re trying to be very careful about our budget because of Eversource,” Branscom said. “We’re trying to not ask for more than what we really need.”
The school board’s next meeting is set for Feb. 7 at 6 p.m. at Bow High. The annual school district meeting is March 15 at 7 p.m. in the Bow High auditorium.
The valuation for Merrimack Station for the years 2014 through 2017 is still being litigated. A trial in Merrimack County Superior Court is scheduled for this June to look at the years 2014 through 2016.
The coal-fired power plant, which is rarely used in today’s electricity markets, was sold to Connecticut-based Granite Shore Power in January 2018.