posted on 11/28/2022

The City Council, at a Wednesday, Nov. 30 special meeting, will hold a public hearing followed by a vote on a resolution to authorize the city to borrow up to $10 million to meet its cash flow needs through a Tax Anticipation Note. A workshop will follow the special meeting. 

The potential need for a TAN is to make two significant payments for the FY2023 fiscal year next month before the city receives property tax revenue from tax bills. One is a $4,026,966 payment for mid-year debt service payments; the other is to the Strafford County government for $9,848,433. Strafford County residents pay a county portion of their property taxes to their local government, which is distributed to the county in a lump sum each December.

“Typically, we strive to have a certified tax rate from the Department of Revenue Administration and have tax bills mailed by mid-November with a due date for the first half tax payment no later than mid-December,” Joyal told the City Council earlier this month. “The timing for the receipt of the certified tax rate and our issuance of tax bills is critical to ensure we have sufficient cash receipts on hand to make a debt service payment on Dec. 15 and the county tax bill, due in full, on Dec. 16 of each year.”

Any interest costs for the TAN would be made from existing appropriations for bond issuance costs.

The city does not anticipate receiving a certified tax rate from the DRA until at least Nov. 30. If the DRA certifies the tax rate then, the first half of the FY2023 tax bill would likely be issued on Dec. 8 with a due date of Jan. 9, 2023. Typically, the bulk of property tax revenue arrives about two weeks after the bills are mailed, which would be after the two significant payments are due this year....more