Laconia City Manager Kirk Beattie presented a preliminary budget compliant with the tax cap, indicating a reduced tax rate, to the city council on Monday, April 28.
The budget process is just beginning to play out in public, but city department heads have been working to develop it for most of a year. The council has to pass a budget by the end of July, one month into fiscal year 2026.
The total amount proposed to be raised by taxes for the city, the school district, the county and state education is $61.54 million, an increase of 4.09% over last fiscal year.
“This is a 30,000-foot-view of what we’re looking for for an expenditure plan,” Beattie said.
“Over the next 2.5 months is a lot of work that goes on, all of our department heads will be in front of you to explain their budgets, explain what they were looking for, what we were able to fund for them, how it affects their department and what they need to do to grow and to move forward.”
Each department director submits an itemized estimate of expenditures for the next fiscal year to the city manager, and that information is assembled by the finance department into a comprehensive document submitted to council by Beattie for review, debate and eventual approval.
A public hearing will be held about the budget before final adoption. Councilors have to approve a budget no later than July 27, and if they don’t, the initially proposed budget would be deemed adopted by city council. “We also know that over 2.5 months, a lot can change, in revenue or expenditures or things that you’re looking for,” Beattie said.
Included in the budget are several potential new positions, including a community paramedic in the fire department, a crime analyst in the police department and a project manager in the planning department.
A significant appropriation in the initial proposal is $100,000 to update the city’s master plan, which hasn’t been done since 2018. The 2018 master plan is greatly abbreviated in comparison to the 2007 master plan, which was 150 pages long — the 2018 edition was just 25 pages long, and city personnel have long discussed the need for another edition as Laconia continues to grow.
Councilors in November 2005 adopted a tax cap to limit increases in future proposed budgets. The tax cap limits increases in net spending for the city, the school district and the county by limiting increases to changes in the urban federal national consumer price index and to the value of new building permits between April 1 and March 31 minus the value of demolitions, multiplied by the tax rate from the previous year. Councilors can override the tax cap with a two-thirds vote.
Based on the rules on the tax cap, the total allowable increase in the amount to be raised by taxes is $2.42 million. The urban CPI for 2024 was 2.96%, allowing for $1.75 million in additional spending, and the net value for new building construction was $48 million, allowing for $667,624 in additional spending.
Last year, the final total tax rate paid by residents of Laconia was $13.63, according to those established by the NH Department of Revenue Administration: $5.44 on the municipal rate; $0.96 on the county rate; $1.15 on the state education rate; and $6.08 on the school district rate. The total municipal budget commitment was $59.5 million.
This year, according to Beattie’s initial estimate, the total tax rate per $1,000 is lower, at $13.54. The breakdown is estimated as follows: $5.42 on the city rate; $0.99 on the county rate; $1.17 on the state education rate; and $5.96 on the school district rate.
The city tax rate decreased five times between 2020 and 2024, and property valuation increased each year concurrently.
“These numbers are not final until DRA does their evaluation,” Beattie said. “These are estimates; I think we’ve done a nice job of not over-valuating on our conservative part.”
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