By DEVON CORMIER
Staff Writer

Tax bills are about to be mailed and this year’s tax rate is $1.43 higher per $1,000 than last year’s, an increase of more than 6.9 percent.

The new tax rate is set at $22 per $1,000 of property value. The increase is due to a spike in the local school portion of the tax rate.

Although the local school portion increased 30 percent to $10.38, a huge increase in new taxable construction kept the tax rate from increasing more than the $1.43 residents will see on tax bills mailed in the last week of October.

That translates to an annual tax bill of $4,400 for the owner of a home valued at $200,000. Last year a home of similar value would have owed $4,100.

Town tax rate down

The town portion of the tax rate went down from $6.01 to $5.84. Hooksett Town Administrator Moni Sharma said there are a few reasons for the decrease. First, the town is operating off of a default budget which caused many departments to “tighten their belts.”

Town Councilor Michael DiBitteto said the main reason for the decrease in the town portion of the tax rate is a huge increase in new taxable construction. The town has about $57 million in new construction property values, including $46 million from the tax increment financing, or TIF district off of Interstate 93’s Exit 10.

“We are growing and improving our infrastructure,” DiBitteto said. “There is a lot of revenue in excess of the bond payment and we are already seeing the benefit.”

The TIF district was established about five years ago to help the town pay off bonds for infrastructure improvements; in this case road improvements and lane widening on Route 3A. All development in the TIF dis- trict pays the same amount of taxes as anywhere else in Hooksett, but money is taken out of the taxes to pay for the bond before anything else. The rest of the money then goes into the general fund.

The bond is for about $2.5 million and the interest pay- ments go down each year. Because the payments are decreasing and taxable con- struction is increasing, the TIF district is contributing a lot of money to the general fund, which helps offset the increase in the local school portion of the tax rate.

This year the $46 million in taxable construction generated $964,000 in revenue. Because it is a TIF district, money gets taken out first for the bond pay- ment. After the bond payment was taken out, $411,000 went into the general fund. This num- ber will grow as the bond pay- ments decrease and taxable con- struction continues to increase.

“The tax base is much bigger now,” DiBitteto said. “The increase in development more than covers the bond payment. We are in a positive cash flow situation with the TIF district.”

Development is continuing to increase and the payments are going down each year, so residents can expect the town portion of the tax rate to stay steady, DiBitteto said.

On the other side, the local school rate increased from $7.94 last year to $10.38 this year. Business Administrator for Superintendent Sally Waterhouse said that two things are responsible for raising the local school rate.

This year, residents will be paying the highest amount on the bond payment for the new Cawley School and the renovations and expansion of Memorial Middle School, she said. Last year was the first year that residents began paying off the bond, but the schedule is set up so that this is the most expensive year. Payments will now decrease each year.

Waterhouse said that a cut in the state school portion of the tax rate has also pushed the local rate up.

“The state education tax is about $781,000 less than last year,” Waterhouse said. “That has to be raised at the local level. Money used to come in from the state level and now we are shifting back to the local portion.”

Waterhouse said the state decides an adequacy amount, or the amount of tax money each child should have for school. That amount has practically been cut in half recently, Waterhouse said.

This year the state school portion of the tax rate is $3.51; down from $4.41 last year. Waterhouse said this leaves the local level scrambling to raise the rest of the money. Waterhouse remembers when the state portion was $6.60 per $1,000 of property value.

Waterhouse said that other things, such as the rising price of health insurance, are increasing costs as well. Next year the bond payment will be lower but these uncontrollable budgetary increases may keep the local school rate up. However, Waterhouse said she doesn’t think residents will see the big spike in the rate they saw this year in the near future.

Overall, the tax rate is split into four portions. The town portion went down 3 percent, the local school portion went up 30 percent, the state school rate went down 20 percent and the county portion went up 3 percent, according to Sharma.