Editor’s note: This story comes to us from The Chronicle in Barton.
MONTPELIER — A miscellaneous tax bill affecting statewide snowmobile trails and eligibility for homeowner rebates could be facing a grueling round of negotiations following a Senate vote Monday.
The bill passed by the Senate is not the bill that came over from the House, and in some ways reflected issues raised in the Northeast Kingdom.
As amended by the Senate, the bill would leave town listers free to use the presence of snowmobile trails maintained by the Vermont Association of Snow Travelers (VAST) to appraise the value of landowners’ property.
The Senate also removed a cap that the House had placed on property tax rebates, saying that primary residences whose value exceeds $425,000 would not be eligible for the program.
Instead, according to the Senate version of the bill, a household whose net worth exceeds $1-million would not be eligible for a rebate.
The Senate fix was not welcomed by Derby Town Clerk Nicole Daigle, who has fought against a property tax rebate program she says makes the average homeowner subsidize the rich.
Houses in the town of Derby received about $700,000 in property tax rebates, according to Ms. Daigle. And most of the money went to the homeowners who live in the most expensive homes in town.
For example, she cites her own home on which she pays $3,300 in property tax on a primary residence appraised at $238,000. Because of the household income, the property is not eligible for a rebate.
But on another home in town appraised at $600,000, the owners pay just $2,300 in property taxes because their income is low enough to qualify for a rebate.
Ms. Daigle would like to scuttle the entire tax rebate program, which she says is calculated at a “falsified rate.” By doing away with the program, she says, the state would save money and every property owner would pay on what he or she owns.
Senator Vince Illuzzi of Derby was among the senators who voted in favor of the $1-million cap.
“It was the most we could do,” he said, adding that he agreed with Ms. Daigle that people who own expensive houses should pay their fair share of property taxes.
Allegations that the rich were “gaming the system” has dogged the rebate program since its inception. Before the bill came onto the floor, testimony before the Senate Finance Committee suggested that a home’s fair market value could have nothing or little to do with a person’s income. A person’s wealth, the testimony ran, should be figured on assets and stocks, and not solely on the fair market value of his primary residence.
But Ms. Daigle says that the expensive homes in her town are the ones that have been recently built. And the owners know it.
“If you set out to build a house of the highest magnitude,” she says, “you must know you can afford it.”
A question of real estate values of another stripe is also expected to surface when the conference committee — made up of three members apiece from the House and Senate — meet to resolve differences in the bill.
A decision by Canaan listers to put a higher value on property open to snowmobiles trails prompted the House to eliminate the practice. And in the bill it sent to the Senate, the presence of a snowmobile trail was to have no bearing on a property’s value.
The Senate Finance Committee, however, refused to go along with the restriction.
Senator Anne Cummings, who chairs the committee, told senators last week that legislation was not needed to fix a problem that has arisen in only one town.
“If it does seem to be spreading, we’ll go back,” she said.
