METHUEN — With the city unable to send out property tax bills, city councilors are scheduled to hold a special meeting next Monday night to revisit a proposed tax increase for homeowners.
Mayor William Manzi asked councilors to approve a new "shift" in the tax burden to increase the amount that residents pay by $128, on average, over what they paid last year by reducing the tax increase imposed on businesses.
But the councilors didn't act on his request at their most recent meeting last Monday night, and Manzi said the city will be prevented from mailing tax bills at the end of the month as planned and the city will face a $12 million shortfall by February.
"I got home last night and I wasn't very satisfied with my own performance," Councilor John Cronin Jr. said yesterday. "Never have I ducked a vote, and that's what I feel we did last night."
Cronin requested the special meeting yesterday, and councilors Stephen Zanni and Joseph Leone also signed the request, according to council Chairwoman Deborah Quinn.
"I'm sure I'm going to be castrated for it," Cronin said.
The meeting is scheduled for 7 p.m. Monday in the Great Hall of City Hall.
Councilors voted in favor of tax rates on Dec. 7 that would have caused the average resident's taxes to rise by $88 and the average business' taxes to rise by $609. The state Department of Revenue rejected the rates, saying the city was going to place too much burden on businesses. That led Manzi to ask the councilors to approve new rates reducing the burden on businesses and increasing it on homeowners.
It would have resulted in tax rates of $12 per $1,000 of property valuation for residents and $22.18 per $1,000 of valuation for businesses. On Dec. 7, the council approved rates of $11.86 per $1,000 of residential valuation and $22.99 per $1,000 of commercial valuation.
With the new shift, the average business would have seen an increase of $287 over what it paid last year.
City Councilor Kenneth Willette Jr. said Monday night that it was his understanding that the rates approved on Dec. 7 would stay in place, and Manzi disagreed and said the city is now left without a tax rate and cannot mail bills to taxpayers.
"In the view of the Division of Local Services, there is no tax rate that has been set in Methuen," said Robert Bliss, spokesman for the Department of Revenue. "The first one does not meet the requirements of the law, so it's not going to be approved."
Manzi said in a memo to councilors before last Monday's meeting that the city will face a cash flow shortfall of about $12 million in the "January/February time frame." The shortfall would force a furlough of all non-essential personnel from city government, Manzi said.
"They need to take an action here," Manzi said yesterday.
Cronin said he talked to City Auditor Thomas Kelly, and Kelly is going to provide councilors with a letter from the Department of Revenue to explain the situation.
Cronin said he is "95 percent sure" he will vote to approve the new tax shift. He said there's "no other option."
"They must have the votes. It stinks," said Councilor Larry Giordano, an opponent of the residential tax increase.
Giordano was scheduled to be on a family vacation three hours away in northern New Hampshire, but he will come back for the meeting, he said.
"I'll still vote against it," he said.
"It could fail again on Monday. I think we have to take the vote," Cronin said.
