Milton budget close to vote

Milton Town Council will hold a public hearing Monday, Aug. 31, on the fiscal year 2021 budget, which includes a 6 1/4 percent property tax increase.

Town council will need to approve the $3.4 million budget before Oct. 1. The tax increase would bring in an extra $81,000 for the town. 

Town Manager Kristy Rogers said, “The most important thing to strive for this year is to reduce our reliance on realty transfer tax to cover some parts of our operations. I was trying to be reasonable in the management of what that tax increase would be. We’ve got to get off our reserves. Other towns do not use their transfer tax for operations, and we do.”

Rogers said the town is using $700,000 in transfer tax surplus and reserves in this draft budget. While the town’s real estate market is currently doing well – as of June 30, the town had taken in $328,000 in transfer tax revenue against a $255,000 budget – she said much of what is being sold is existing houses, not new construction. 

“Even though it seems like there’s a lot of building, we’ve only issued 33 building permits in town,” Rogers said. “I can’t predict what next year will bring or any impact that COVID may have on the building industry. And the annexations we have out there have not been voted on yet, so we can’t rely on what revenues those may or not bring.”

This year, the town budgeted $205,000 in transfer tax revenue, although Rogers said that total is not what the town expects to take in, but what is expected to be used. Unlike Rehoboth Beach and Lewes, Milton has no beach or parking meters to drive revenue, which is mostly derived from property taxes and transfer tax proceeds. 

Rogers first broached the idea of a property tax increase in discussions for the fiscal year 2020 budget. Her original proposal was for a 3 percent increase, designed to bring in $33,000 to help with capital improvements. Milton has not raised its property tax since 2015. 

Rogers said the town is already spending too much of its surplus transfer tax revenues on capital improvement projects, such as the Magnolia Street drainage project, for which the town is budgeted to spend $379,000 in transfer tax reserves, or last year, when the town spent $429,000 in reserves to purchase 4 acres of land on Federal Street for a new well and water tower.

Councilman Rich Baty, chairman of the town’s finance committee, said he thought the capital improvement budget needed more work, mostly in terms of having better justification for certain projects and better planning.

“When we have five vehicles that may need to be replaced, and that comes in at $500,000, we can’t do all that in one year,” Baty said. 

Three major capital purchases include a new, $35,000 F250 pickup truck with a snowplow, $145,000 for a new dump truck and $814,000 for the Magnolia Street project, designed to alleviate flooding issues in that area and in the municipal parking lot. Councilman Sam Garde and Councilman Michael Cote both expressed support for those expenses and vouched for them to remain in the draft budget. Councilman Charlie Fleetwood said he wanted to see the town give more than the $5,000 it gives to the Milton Fire Department. 

Still, he said, the general revenue and expenditure side of the budget looked good. Baty agreed a property tax increase would be necessary, as the town has not raised the rate since 2015, and that he also believes the town could provide more money for continuing education for the police department. 

The finance committee meets at 2 p.m., Friday, Aug. 21, at Grace Church, to draft its advisory report on the budget in time for the Aug. 31 council meeting.