Houlton pushed back its property tax due date by 35 days as officials continue to discuss potential ways to help taxpayers facing the second round of valuation increases in three years.
“We have to do something to help the people for this winter,” said Town Council Chairman Ed Lake during Monday night’s meeting. “The heating oil is going to be outrageous and if they get an outrageous tax bill, it’s really going to put a hurt on a lot of people.”
Councilors voted to extend the tax payment deadline to Nov. 20 and also slated a special Town Council meeting at 5 p.m. Oct. 5, to discuss ways to potentially lower the 2026 mill rate.
The decision must be evaluated carefully to avoid an even more difficult decision next year,
Councilor Fred Grant cautioned.
In February, officials said property valuations would again be adjusted this year after Maine Revenue Services notified the town that its 2026 ratio was 80%, meaning the overall property valuation is about 20% below the state’s valuation.
When the ratio falls below 100%, property owners qualifying for the state’s homestead, veterans and blind exemption programs will not receive their full exemption because the current assessments do not reflect the changing market values, Houlton assessor Terry Duff said in February.
“The ratio needs to be at 100%,” Duff said.
Mainers throughout the state have been hit by similar challenges in recent years, driven by a spike in home sale prices that have sometimes doubled valuations and taxes. Duff said she calculates property valuations using current market sales data along with property condition, age, recent renovations and other property features to formulate the new value.
Some valuations will increase 20% or more, while some, depending on condition, will decrease, she said.
As of Monday night, town property valuations were still listed on property cards with 2025 valuations.
Last year the mill rate held steady at 19.4 (or $19.40 per $1,000 in home value) because town councilors voted to use up to a half million dollars of the town’s undesignated fund balance and another half million from Tax Increment Finance reserve accounts, according to a letter sent to taxpayers at the time.
This year officials are evaluating similar options.
“People’s valuations have gone up this year and we did approve $500,000 from undesignated funds which we will probably need to use the full amount,” said Interim Town Manager Nancy Ketch on Monday night.
There was also a figure in the town budget for pulling in $920,000 from the Tax Increment Financing account to offset some expenses, Ketch said.
“The recommendation is to not pull that money in,” she shared with the council. “We have run some numbers and the possibility of reducing the capture to assist with the tax bills is what we are looking at.”
Generally, if a municipality reduces a TIF capture, it “diverts less of the new property tax growth from a designated development district into a TIF fund, leaving more of that incremental value in the general tax base to lower or stabilize the overall mill rate,” according to the Minnesota-based Family Housing Fund.
According to Ketch, if everything is left the same, not taking the $920,000 and doing 100% TIF capture, the mill rate would be 19.9. It was 19.4 last year. For a home valued last year at $100,000 with a 19.4 mill rate, the tax bill would have been $1,940. If the valuation increased 20% to $120,000, the tax bill would increase to $2,328 at the same mill rate. If the mill rate increased to 19.9, the new tax would be $2,388.
In all the scenarios Ketch presented, the tax on the revalued $100,000 home increased from last year, even when the mill rate was reduced. In one scenario, the mill rate reduced to 18.0, and the tax on the $120,000 home would be $2,160.
“There are a number of options,” Ketch said.
Town Councilor Sue Tortello said that the information presented on Monday night was a lot to digest.
“I very much believe that we need to have a session where we can talk about this in detail and look at scenarios with numbers in front of us,” she said.
