WINDHAM-The lag in the property tax credit afforded to homeowners may potentially have serious implications for some residents, as well as residents of other towns throughout the state.
Earlier this year, for the first time since 2014, Windham underwent a reappraisal, some residents saw a dramatic increase in the value of their homes which, in turn, caused a large spike in their property tax bills.
According to an article at vermontpublic.org, the homestead taxes paid by the median home in Windham increased by 39.03% from fiscal year 2024 to 2025.
Of the 29 towns throughout the state that underwent reappraisals this year, according to the article, Windham saw the largest increase in taxes. That, coupled with effects on the municipal and education tax rates, has caused concerns among some residents.
More than one Windham resident said the value of their home rose significantly, creating a strain due to the increase in their property taxes.
Maureen Fitch is one of those residents. After the reappraisal, Fitch said the value of her home increased from $180,000 to $345,000 and her property taxes increased from $5,180.22 to $7,283.03 this year, a more-than-40% hike.
About two-thirds of homeowners receive a homestead property tax credit (PTC) based on household income that can provide some relief and homeowners in the state receive the credit.
For a person who makes less than or equal to $47,000, the PTC may be used on the first $400,000 of the housesite value and additional tax relief is available based on household income.
For a person who make between $47,001 and $90,000, the PTC may be used on the first $400,000 of the housesite value, but no tax relief is available. For a person who makes between $90,001 and $128,000, the PTC may be used on the first $225,000 of the housesite value.
People who make more than $128,000 do not qualify for the credit.
The PTC is applied to the following year's tax bill. Property tax bills for homeowners with income sensitivity are calculated by taking the current year's homestead property tax and subtracting the prior year's property tax credit. In the instance of taxpayers in Windham, and possibly other towns throughout the state that underwent a reappraisal, the prior year's tax credit, which was based on the lower property values, will be applied to their current tax bills that saw an increase due to reappraisal.
'Very, very mindful' of stretching income
Fitch, 66, said the statewide increase in education taxes coupled with the reappraisal has created a strain for her. She indicated that she had to make a financial adjustment about five years ago as well when she saw a large increase in her homeowner's insurance.
"That went up dramatically and that was even way before this whole situation with the town reappraisal. I think it was 2019, before the pandemic happened," she said.
"It felt really out of proportion with what it would cost to build a house, and of course the pandemic changed that," Fitch said. "You have to be very, very mindful of your income and how you can stretch it."
Fitch said she received the new tax bill around mid-August, with the payment due by Nov. 1. She set up a payment plan with the town to avoid incurring interest and submitted a request for abatement.
Hearings with the Board of Abatement were scheduled for Dec. 10, but weather caused them to be postponed until "after all work is completed in preparation for Town Meeting," according to Selectboard minutes for the Dec. 16, 2024 meeting.
Fitch and her late husband, Christopher, bought her home in 1985 for $30,000. Today, she said the mortgage is almost paid off and the payment is low.
"That is why I can sustain myself, but you just look at people right now trying to afford a home. It's really, really tough. So, I feel fortunate - very, very fortunate," Fitch said.
However, she said that if she had to pay what her children are paying for a mortgage, she would be hard pressed to come up with the money. When she first received her property tax bill this year, Fitch said it came as a surprise, and the lack of warning caused some sleepless nights.
"The property tax bill came Aug. 14 [...] and they're due Nov. 1, so that was very, very little time," she said.
Fitch's first thought? "Oh, you're kidding me. That's how much I need to come up with in this short amount of time?" she said.
"When you live paycheck to paycheck that was a punch in the gut, I've got to say," she continued. "We all figure out how to do what we have to do and thankfully, the town was more than willing to do the payment plan, so I feel that I'm probably not as bad as some people are."
Fitch said she "still feel[s] sorry for people that are starting out these days because it's a tough one. It really, really is."
Still, she said she feels lucky to have options to help navigate situations such as this from the PTC, filing a request for abatement, or even working out a payment plan to help her to continue to reside in Windham, a place that she loves.
"We're all here in Vermont, and I know it's a very special place. I really feel like it's one of those places that if you get to experience it and live here, you're very lucky," Fitch said. "So, I feel like I'm one of the lucky ones."
This News item by Brandon Canevari was written for The Commons.