Taxes

Restraining property tax increases in the future will take thoughtful leadership.

Arguably the highest-profile responsibility that city councilors have is providing high-quality core public services at a tax burden that is sustainable for our residential and business taxpayers. A successful balance will not, however, just happen. It will take thoughtful leadership.

City council candidates will talk a lot about how to keep taxes low, but it really comes down to three factors:

  1. The amount of taxable property in the city
  2. The quality of management, and level of efficiency, in providing key public services
  3. The level of public services the city will provide relative to the ability to pay for those services

Outstanding city councilors understand the critical importance of all three of these factors.

The increase in taxable property, especially commercial property, onto the tax rolls over the past 10+ years has been an enormous factor in keeping residential tax increases to a minimum, while paying for quality education, public safety, and infrastructure.

A Portsmouth Herald story from February of 2015 reported that between just FY2010 and FY2014, property values had increased $279 million – netting an additional five million dollars in tax revenue from the increase alone. Considering that over 55% of Portsmouth’s annual budget goes to pay for K-12 education, and that virtually none of the new commercial property added to the rolls leads to increased education spending, there can be no doubt: residential taxpayers, and households with school-aged children, are enormous beneficiaries of this increase in taxable property.

A key factor in keeping tax increases to a minimum is the quality of municipal management, and the ability to efficiently deliver public services.

Over the past several years, Portsmouth has had a number of examples of the fruits of high-quality management and an emphasis on delivering outcomes efficiently:

  • Portsmouth is one of two communities in New Hampshire with a AAA bond rating, which meaningfully lowers the cost of borrowing money for capital projects. Portsmouth has seen its bond rating increased five times since 1999.
  • As the downtown economy continues to grow, our public safety ratings continue to improve (see below). This has occurred over a period of the last decade where the number of patrol officers in Portsmouth has actually decreased.
  • As our K-12 education system receives increased recognition for excellence (see below), the number of teachers has decreased, and school budget spending increases have kept at or below inflation.

In order to maintain this high standard of accountability, our city councilors must be comfortable asking sophisticated questions, making difficult decisions, and focusing on outcomes during the budget process.

In the pursuit of delivering high-quality public services to the residents of Portsmouth, tax increases should continue to be limited to no more than people’s ability to pay.

As a practical matter, taxes have increased at or below inflation each year over the past decade, a record unmatched by other cities in New Hampshire. While considerable attention is placed on residents of certain neighborhoods, such as the downtown or South End neighborhoods, the reality is that most of the city’s residents live in neighborhoods with greater socioeconomic diversity, and more sensitivity to significant tax or fee increases. Even so, the commitment to high-quality education, public safety, and infrastructure at a sustainable price has been staggering over the past 10+ years.

Consider:

  • A late 2014 national report ranked Portsmouth’s three public elementary schools among the top ten in the entire state, and a U.S. News study ranked our high school #9 in the state
  • In early 2015, the city announced the completion of over $50 million in sewer separation projects which have significantly reduced flooding, reduced sewage discharge, and dramatically improved sidewalks and streetscapes in many residential neighborhoods
  • A late 2014 report by a real estate organization evaluating various crime-related data named Portsmouth second-safest city in New Hampshire, and one of the ten safest communities overall in the state
  • A state-of-the-art public library was completed in 2006
  • The renovation and addition to the Portsmouth Middle School was completed during the 2014-2015 school year
  • Improved recreational facilities, including renovations and replacements for virtually all of the city’s playgrounds, the new Connie Bean Recreational Center, and the installation of a synthetic turf field at the high school
  • A new fire station in the city’s southern tier
  • Improvements at Pierce Island and Prescott Park

Thanks to many years of strong municipal management and leadership, tough decision-making both before and during the recent recession, and powerful growth in Portsmouth’s tax base, Portsmouth has demonstrated the ability to respect taxpayers and continue to improve public services. That is the standard to which future councilors should be held, as well.

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