TITLE III TOWNS, CITIES, VILLAGE DISTRICTS, AND UNINCORPORATED PLACES
CHAPTER 32 MUNICIPAL BUDGET LAW
Preparation of Budgets
Section 32:5-b
32:5-b Local Tax Cap. –
Upon adoption under RSA 32:5-c, the following shall apply:
I. In a town or district that has adopted this section, the estimated amount of local taxes to be raised for the fiscal year shall include the operating budget and all other warrant articles with a tax impact, certified by the governing body or the budget committee and posted on the warrant for the annual meeting pursuant to RSA 32:5. The estimated amount of local taxes to be raised for the fiscal year shall not exceed the local taxes raised for the prior year, as shown on the same budget and adjusted as provided in paragraph I-a and II, by more than the tax cap authorized when this section was adopted.
I-a. If the local taxes raised for the prior year were reduced by any fund balance brought forward from previous years, the amount of such reduction shall be added back and included in the amount to which the tax cap is applied under paragraph I.
I-b. (a) In a town or district that has adopted this paragraph, a tax cap limiting the base amount to be raised by property taxes to last year's base shall be adjusted to account for inflation and change in population for towns or village districts, or attendance for school districts, according to the following formula: This year's base = (Last year's base) x (1 + CPI) x (This year's population or attendance / Last year's population or attendance).
(b) In this paragraph:
(1) "Attendance" shall mean the average daily membership in residence (ADMR) of the school district, pursuant to RSA 198:38, I-a. "This year's attendance" shall be the annual ADMR reported to the department of education as of October 1 preceding the date of the budget hearing held pursuant to RSA 32:5, I. "Last year's attendance" shall be the annual ADMR reported to the department of education as of October 1 of the year prior to the annual ADMR reported for "This year's attendance".
(2) "Base amount" or "base" shall mean the local taxes raised for the year. "This year's base" shall be the "base" proposed at the annual budget hearing held pursuant to RSA 32:5, I. "Last year's base" shall be the "base" of the year prior to the "base" reported for "This year's base".
(3) The increase for inflation, or CPI (consumer price index) in the formula above, shall be the annual percentage change of an inflation index published by the U.S. Bureau of Labor Statistics as of October 1 or the annual percentage change of the Municipal Cost Index (MCI) published by American City and County as of October 1, preceding the date of the budget hearing held pursuant to RSA 32:5, I.
(4) "Population" shall mean the annual population figures for the town or district calculated by the department of business and economic affairs, office of planning and development pursuant to RSA 78-A:25, I. "This year's population" shall be the "Population" preceding the date of the budget hearing held pursuant to RSA 32:5, I. "Last year's population" shall be the "Population" of the year prior to the "Population" reported for "This year's population".
II. The tax cap shall be either a fixed dollar amount, a fixed percentage, or a multiplication factor applied to the amount of local taxes raised by the town or district for the prior fiscal year as reported to the department of revenue administration as provided in paragraph I-b, subject to adjustment as provided in paragraph I-a.
III. The legislative body may override the cap by the usual procedures applicable to annual meetings of the legislative body, provided that: when a proposed appropriation will cause the amount of local taxes raised by the town or district to exceed the tax cap under this section or the total amount already raised and appropriated has caused the amount of local taxes raised by the town or district to exceed the tax cap under this section, voting on the appropriation question shall be by ballot, except in the case of a legislative body that uses an official ballot form of meeting under RSA 40:13 or under a charter adopted pursuant to RSA 49-D. If a 3/5 majority or the supermajority as determined under a charter pursuant to RSA 49-D of those voting on the question vote "yes," the appropriation is approved. Only votes in the affirmative or negative shall be included in the calculation of the 3/5 majority or the supermajority as determined under a charter pursuant to RSA 49-D.
(a) When using the official ballot form of meeting under RSA 40:13, if the warrant article for the operating budget results in appropriations exceeding the tax cap under this section and receives less than 3/5 majority "yes" vote, the adopted operating budget shall be reduced by appropriations already raised to remain compliant with the tax cap under this section.
(b) School districts shall place the warrant article for the SAU budget at the beginning of school district warrant, immediately after any warrant articles proposing bonds or notes. For school districts using a traditional meeting and when the outcome of the SAU budget vote is pending on balloting from the other school districts in the SAU, the higher of the school district's assigned portion of the proposed SAU budget or the school district's assigned portion of the adjusted SAU budget shall be assumed as raised and appropriated for the purpose of determining when the override provisions under paragraph III apply.