Nashua, Holding down taxes.

We Used $7.1 Million of the $9.6 Million City Surplus to Hold Down the Tax Rate

Dear Nashua,
During the City’s past fiscal year  FY 17 ending on June 30, 2017
City government was able to generate a $9.6 million surplus.
I proposed that we help our taxpayers by using $7.1 million of the City surplus to hold down the tax rate.  The Board of Aldermen adopted my proposal on a unanimous vote.
Nashua people work hard for their money.  And we have many seniors who are on a fixed income.  So we need to spend tax dollars wisely and manage our finances carefully in order to keep taxes as low as possible.
How We Generated the $9.6 Million Surplus
The $9.6 million surplus came from 2 sources.  First, revenue exceeded estimates by $5.6 million, most of this surplus revenue coming from car registrations.  Second, at the end of the year there were $4.0 million of unspent appropriations.  By being careful about spending during the year,  we saved $1.5 million.  The remainder consisted of longer term projects which were not yet complete.
The City has always had a year-end surplus, but the surplus for FY17 was the largest on record.  In the previous fiscal year – FY 16, ending June 30, 2016 – we used $4.5 of that year’s surplus to reduce the tax rate.
Using the Surplus to Help Taxpayers
I proposed that we use $7.1 million of our surplus to help taxpayers by holding down the tax rate, and the Board of Aldermen approved.  This is a link to the Resolution-17-125 which authorized using $7.1 million to reduce the tax rate:  Relief for Taxpayers
Nashua’s Tax Rate
The tax rate for the coming year will be up 2.88%.
Large increases in just 3 fixed costs were the main cause of the tax increase.  The State of New Hampshire increased its pension bill to the City by over $2.2 million or by more than 10%.  Health care insurance costs were up $3.6 million or by more than 15%.  And Pennichuck’s bill to Nashua was up almost $400,000 or by more than 14%.  These increases in fixed costs added more than $6 million to the City budget.
Without Major Increases in Fixed Costs, the Tax Rate Would Have Been Flat
Without the major increases in these 3 fixed costs  the state pension bill, health care costs, and Pennichuck – Nashua’s taxes would have stayed at the current rate and would not gone up at all.
Please Keep in Touch
I will continue to update you about City issues.  Please contact me at with any thoughts or questions about the City budget or about anything else concerning City government.
Jim Donchess,
Mayor of Nashua
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