Essex town residents are facing a whopping 22% increase in property taxes that many say is no surprise, given the effects of inflation and Essex Junction’s separation from the town last year.
“Nobody’s happy about it, but we knew this was coming,” said town resident and activist Ken Signorello.
The selectboard Monday night warned a $15.4 million budget for fiscal year 2024 that voters will consider on Town Meeting Day in March. That’s a 7.6% decrease from fiscal year 2023, but because the town lost half its residents to the newly created City of Essex Junction, it would result in a projected 22% increase in property taxes. If approved, it would be the largest leap among Chittenden County’s proposed municipal budgets this season.
A median homeowner with a house worth $280,000 could expect a $340 increase in their property tax bill next fiscal year, according to Daniel Roy, the town’s financial director.
“Our overall budget and tax levies have decreased, but with the over 40% reduction in our grand list valuation upon separation, we are presenting a 22% municipal tax rate increase,” he said via email. The grand list represents the total value of taxable property in the community.
Tracey Delphia, vice chair of the selectboard, said town officials have put together “a very lean budget,” given that they are still funding the same services despite the loss of village residents — and revenues.
If approved on Town Meeting Day, which this year is March 6, the property tax hike would go into effect July 1.
“It’s not unexpected,” said state Sen. Irene Wrenner, D-Chittenden North, who lives in Essex and was a vocal opponent of merging the town and the village of Essex Junction. “Anytime 41% of your tax base goes away, your taxes will probably increase.”
She pointed to an early 2022 estimate by former finance director Sarah Macy predicting such an increase, but finding that a merger would have been even costlier to town residents.
“I’m a resident of the town and this tax increase is much better than the tax increase we would have gotten if we merged,” said Signorello, who was an outspoken merger opponent.
“I understand my taxes are going to go up, so be it,” said Essex resident Bruce Post, a former selectboard member. “I think the cost is well worth not having these squabbles go on.”
Despite spirited debates on social media, no one spoke about the proposed hike at Monday’s final public hearing on the town budget. The selectboard approved it 3-1, with member Kendall Chamberlin voting against it.
For decades, residents in Vermont’s second most populous community wrestled with the question of merging versus separating the town from the village.
After two failed merger votes, Essex Junction voters approved separation in 2021, creating two municipal communities — one more urban but smaller, the other mostly rural and larger.
Incorporated as Vermont’s 10th city on July 1, 2022, Essex Junction is looking at a proposed 1.5% property tax increase. That’s not a bad place to be, given the rate of inflation throughout the country and increases in property taxes around Vermont, according to City Council President Andrew Brown.
“This is the first time in Essex Junction when we are our own separate municipality,” Brown said. “In that sense, the Essex Junction taxes are going to look significant compared to what they have been in the past, largely because there’s going to be more staff and there’s going to be some departments that we haven’t had in the past.”
Still being developed, the city budget for the upcoming fiscal year is estimated to be $11.3 million, up from $6.3 million in fiscal 2023. Essex Junction residents are scheduled to take up the budget in an April ballot this year, not on Town Meeting Day in March.
Brown, formerly a member of the village board of trustees, said, “It’s wonderful to finally be at that place of doing what we need to for our community instead of asking our community to please wait while we figure out what our government’s future is going to be.”
With about 11,000 residents each, the difference in density between the two is stark: The town covers about 39 square miles while the city covers just 4.75 square miles and has a dense urban center. Until separation, Essex Junction property owners paid taxes to both the village and town, supporting services in both. Because 41% of Essex property taxes came from the village, separation was expected to create a substantial financial hit for the town.
“The initial plan with the merger was to spread it out over 12 years,” Delphia said. “But there’s no guarantee that it would remain that way — it could change as time went on. So we’re at the point where we are essentially ripping the Band-Aid off and just doing it once instead of allowing it to fester over time.”
After voting repeatedly for a merger, Essex Junction resident Andy Hayden said he voted for the recent separation.
“I think the tax imbalance between the village and the town was well documented,” he said. “I voted for separation because the merger was sure to fail, and without separation, the imbalance would never be addressed.”
Post, the town resident and former selectboard member, said he remembers one vote to merge that narrowly passed in 2006. He was a proponent then, he said, but as time went on, he became an opponent “because it seemed like the village wanted all the concessions made to their positions.”
In the end, Post said, he didn’t have a say in the split because Essex Junction made the decision on its own — with state approval.
“My town was broken up without me being allowed to vote on it,” he said. “Only a small segment of the town, those who lived in the village, were able to vote on it. I found that incredibly undemocratic.”
However, Post said, it is time for everyone to stop bickering, move forward and help create the communities they want to see.
“The issue was very widely debated and publicized,” he said. “My interest is in building a new town of Essex and contributing to its future.”
Correction: An earlier version of this story mischaracterized the positions on merging Essex and Essex Junction held by Irene Wrenner and Ken Signorello.