Financial Stability and Efficiency

The City strives to diversify its revenue streams to reduce the reliance upon the property tax as the primary source of revenue for general government operations. Recognizing the impact of tax increases on residents, the City strives to balance the need for services, infrastructure, and capital against the resulting tax impacts to the City’s residents. The City shall, when necessary, prioritize funding of strategic objectives to mitigate the impact on the tax rate. User fees have a direct relationship to the services provided and are commensurate with the actual cost of the services provided. The use of Unassigned Fund Balances in the General Fund as well as the enterprise funds is a strategy to minimize tax and fee rate spikes.

The Unassigned Fund Balance in the General Fund is healthy when it:

• is within a range of 15% to 19% of the current General Fund expenditure budget;
• provides a cash reserve to address emergencies;
• provides sufficient cash flow between semi-annual tax billings.

Financial planning is based on a long-term strategy to mitigate tax and user fee rate increases. When possible, planning for capital projects in the six-year Capital Improvements Plan allows a more even spread of debt service payments.

The City’s debt load is maintained within the statutory requirements and the City Council’s Debt Management policy for all funds.

The City utilizes federal, state, and private grant funding to offset the cost of capital and operating expenses. Additionally, the City advocates in partnership with other municipalities and the New Hampshire Municipal Association for more state funding to offset the impact to local property taxes. The City takes active steps to transition education funding from the statewide and local property tax to a more equitable cost share with other revenue sources.