Dunbarton wants voters to decide what to do with extra $1M

  • Dunbarton residents raise their hands to indicate support for letting $1.06 million worth of excess tax money lapse into the school district’s undesignated fund balance during a straw poll at a Tuesday information meeting on June 12, 2018. Caitlin Andrews / Monitor staff

Monitor staff
Published: 6/13/2018 2:23:21 PM

The Dunbarton school board wants taxpayers to decide what do with an extra million dollars in the budget.

A recent audit found $1.06 million left over in Dunbarton’s undesignated fund balance due to reporting errors made while the district was part of the School Administrative Unit 19, which includes New Boston and Goffstown.

There are two ways the district could use that money – put it in a reserve fund that could be used to pay for things like school improvements and tuitioning high school students to Bow over time, or use it take a one-time bite out of the tax rate.

After Tuesday night’s two-hour “million-dollar” informational meeting, the board decided to ask Merrimack County Superior Court for permission to hold a special town meeting dedicated to deciding how the excess money should be spent.

“The school board is nervous about making this decision for the town,” school board member Jeff Trexler said prior to the vote, which occurred after the information meeting. “We’d rather let voters decide.”

Voters certainly weren’t short on opinions on the subject; a straw poll toward the end of the meeting showed a majority of the 50 or so attendees would prefer the one-time tax relief.

Some said it was the only way to make sure those who had been overtaxed got their due.

“To be fair, a lot of people who paid money in, five years from now, a lot of people won’t be here,” said Dana Mullen. “You can’t track down everyone who overpaid every time and won’t reap the benefits.”

Others asked why the town couldn’t simply write a check to taxpayers. Even after Trexler explained, saying there was no law in place that gives municipalities the authority to “rebate” overpaid taxes, some remained unconvinced.

“If there’s an RSA preventing money from coming back to us, fine,” said Dan Meekes. “But if there’s no mechanism in place ... how is it that we pay attention to something that doesn’t have a state law?”

If it wanted to, the school district can’t just send out checks, unless the Legislature gives towns that kind of authority, said Dunbarton state Rep. J.R. Hoell. Theoretically, someone could push for a law change, but even if such a bill flew through the Legislature, it wouldn’t take effect until next year.

“I don’t know if we want to wait that long,” Hoell said.

Similarly, the district is not allowed to use the money to “pre-pay” on bonded projects like the $2.2 million Dunbarton Elementary School facilities project or to create a reserve to pay for future bond payments, Trexler said.

Should the money lapse this year, taxpayers would see a sincere decrease in their December 2018 tax bill – about $1,000 for a home with an assessed property value of $300,000, according to Dunbarton school board documents.

But SAU 67 Finance Director Duane Ford cautioned that the one-time payment would be exactly that – one-time – and the tax rate would return to similar levels by next June. If the town decided to spread the money out, it would impact the tax rate at a more gradual level – keeping the tax rate flat for roughly three years.

The money also doesn’t have to be spent in the school district, Trexler said – it could also be transferred to the town’s side.

“There’s no wrong answer here,” he said. “It’s all going to come back eventually and benefit the town.”

SAU 19 first reported in December that it had made errors in how it reported its end-of-year fund balances for several years dating back to 2007, when Dunbarton was still part of the district.

The report led to the discovery of $9.1 million retained in Goffstown’s fund balance and $1.1 million in New Boston’s fund balance. The district’s business administrator, Raymond Labore, resigned after the review, according to an SAU 19 press release.

Both New Boston and Goffstown decided to let their excess money lapse directly into their undesignated fund balance, Ford said.

Dunbarton’s $1 million in excess money was discovered through an independent audit conducted by Plodzik and Sanderson, according to Dunbarton school officials. Dunbarton’s records were not included in the SAU 19 review.

Should the board’s petition be granted, SAU 67 Superintendent Dean Cascadden said a public hearing on the issue will take place sometime in late August with a special town meeting in September.

That meeting would have to take place before the district sends its final financial reviews to the Department of Revenue Services, which are due in September before the tax rate is set in October. Dunbarton can request an extension on sending that information.

(Caitlin Andrews can be reached at 369-3309, candrews@cmonitor.com or on Twitter at @ActualCAndrews.)

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