Mayor wants to hold off expanded vet credit
Says state law needed before Nashua moves
NASHUA – Mayor Jim Donchess is asking the Board of Aldermen to hold off approving a proposed ordinance that would expand the veteran’s tax credit, at least until the state has passed a law to make it easier to implement.
The proposed ordinance would expand the $500 a year tax credit to apply to more veterans than it does currently. If this proposal were adopted as is, it could mean that Nashua would be out more than $2 million in property tax revenue.
Expanding the tax credit would cost the city $670,000 a year on top of the $1.5 million is it currently giving in credits to city veterans. The city currently offers the tax credit to about 3,000 veterans and spouses, and the expansion would make an additional approximately 1,500 people eligible for the credit.
There is a way to enact the expanded tax credit, which Donchess said, will lessen the fiscal pain for the city. Senate Bill 80, is passed through the Legislature and signed by Gov. Chris Sununu, would allow municipalities the option of phasing in the expanded tax credit over the course of three years. This is key to Nashua, which is facing a budget crunch in fiscal year 2018, Donchess said.
“Because we are facing a significant budget impact as a result of the $2 million increase in pension costs, phasing in the expanded veterans tax credit over three years will help us mitigate the impact to the tax rate,” Donchess wrote to Aldermen.
The phase-in bill has already passed through the state Senate, and Donchess expects it to make it through a House vote soon. Aldermen are meeting Tuesday evening after the original meeting was postponed because of last week’s storm.
Damien Fisher can be reached at 594-1245 or email@example.com or @Telegraph_DF.