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The N.H. Advantage? Some towns can spend twice as much
as comparably populated neighbor & still have lower tax rate

By Michael Kitch
THE LACONIA DAILY SUN

LACONIA — In the Lakes Region, the “New Hampshire Advantage” amounts to abundant waterfront property and seasonal residents, which are reflected in higher assessed valuations, much larger annual budgets and lower tax rates.

With the delivery of government services primarily organized through hundreds of small townships — with relatively little money trickling down from state government — New Hampshire has built a system that enables some towns to spend literally twice as much as comparable neighboring towns and yet tax their residents at a lower rate.

Comparing two pairs of neighboring towns — Alton and Barnstead and Gilford and Belmont — with comparable populations illustrates the point. In 2009, the estimated populations of Alton and Barnstead were 5,144 and 4,622 respectively and of Gilford and Belmont 7,429 and 7,274. But, the topography of the towns differs markedly.

The 19.3-square miles of water represent 23-percent of the area of Alton while in Barnstead the 2-square-miles of inland water amounts to just 4-percent of the town. Likewise, 27-percent of the area of Gilford consists of 14.7-squaremiles of water while in Belmont the 1.8-square-miles of water represents less than 6-percent of the total area.

The impact of waterfront reflects itself in differences in the number and value of housing units. The towns with extensive waterfront have a higher proportion of housing units,many owned or occupied by seasonal residents, relative to their populations than their landlocked neighbors.

According to data compiled by the New Hampshire Office of Energy and Planning, in 2008 there were 4,199 housing units in Alton, or one for every 1.2 residents compared to 2,464 homes in Barnstead, or one for every 1.9 residents. There were 4,875 housing units in Gilford, one per 1.5 residents, and 3,503 in Belmont, one for every two residents. Waterfront property not only carries a high value but also, if seasonally occupied, imposes fewer costs on the town.

These disparities are expressed in widely divergent assessed valuation of the towns. In 2009, the total assessed valuation of Alton was $1,557-billion, almost three times that of Barnstead’s $545.5-million. At $1,547-billion, the assessed valuation of Gilford was twice that of Belmont’s $724.6-million. The total property tax rates — $11.83 per $1,000 of assessed value in Alton, $18.39 in Barnstead, $17.37 in Gilford and $19.69 in Belmont — vary accordingly.

However, the greatest disparities are in expenditures. The annual budgets and tax commitments of Alton and Gilford in 2010 were almost twice as large as those of Barnstead and Belmont.

In Alton, municipal appropriations were $7,075,746, nearly three-an-a-half times the $2,021,644 appropriated in Barnstead. At the same time, Alton appropriated $11,623,952 for schools compared to $6,087,478 in Barnstead. (The two townships share the same high school and contribute approximately the same number of students.) Excluding the county tax assessment, Alton raised $16,077,589 in property taxes,or $3,125 per capita, compared to $7,942,022 in Barnstead, or $1,718 per capita — 45-percent less.

In Gilford, the municipal budget was $7,411,891 compared to $5,063,845 in Belmont while Gilford appropriated $17,108,448 for education and Belmont $6,6538,071. Discounting the the county assessment, Gilford raised $24,258,525 in property taxes, or $3,265 per capita, while Belmont raised $13,041,714 or $1,792 per capita — 45-percent less.

Of course, in the waterfront towns the per capita tax burden born by the resident population is effectively reduced by the share born by non-resident property taxpayers.

Without accounting precisely for all the differences in spending, Alton and Gilford are spending considerably more on both municipal services and public schools than their inland counterparts.

In Alton, the budgets for personnel, police, public works, parks and recreation and solid waste are approximately double those of Barnstead while the town also spends more on its fire service as well as functions like planning, assessing and code enforcement. Likewise, much of the difference between Gilford and Belmont consists of expenditures for personnel, police, fire and highways and police.

The differences in education spending between the town appear less marked, but comparisons are difficult because while Alton and Barnstead each have K-8 schools they jointly own and operate Prospect Mountain High School. Likewise, Belmont partners with Canterbury in the Shaker Regional School District. And Gilford accepts Gilmanton students, on a tuition basis, at their high school.

Student to teacher ratios range from 10.9 in Barnstead, to 11.8 in Alton, to 11 in Gilford, to 13.3 Belmont. At $15,237 Gilford has the highest cost per pupil followed by Alton at $11,950, Belmont at $11,380 and Barnstead at $11,285. Gilford also posts the highest average teacher salary at $58,154 trailed by Belmont at $55,679, Alton at $48,441 and Barnstead at $42,694.

These disparities are mitigated somewhat since during the summer months, the populations of Alton and Gilford are swollen by the return of seasonal residents and the appearance of visiting vacationers, which adds to the expenses of waterfront towns.

Nevertheless, the relative abundance of valuable and taxable real estate, a significant share of it owned by non-residents who do not vote, appears to sufficiently ease the pressure on resident property taxpayers to enable these towns to spend relatively more on public services.

Perhaps in that sense taxation without representation is also an element of the “New Hampshire Advantage.”