Windham Expects To Get More PILOT Funds

By Michelle Warren, The Chronicle

June 23, 2021

In a bit of good news, the town is getting more state Payment in Lieu of Taxes funds than it included in the budget for the next fiscal year.

Windham Town Manager Jim Rivers made the announcement during the town council meeting last week, noting the official amount of PILOT funding Windham will receive is still unknown.

Windham Finance Director Christian Johnson said there is $3,209,504 budgeted for PILOT in the current budget and $3,710,521 budgeted for PILOT for the upcoming fiscal year, which starts July 1.

“In the end, it is a relief to the taxpayers, for sure,” Johnson said during the town council meeting June 15.

PILOT funding is issued for state property, reservation land, municipally owned airports and private, nonprofit college and hospital property, which is not taxed.

Windham has many properties eligible for PILOT funding, including Eastern Connecticut State University, Windham Airport and Windham Community Memorial Hospital.

Rivers said during the council meeting he was expecting to have more information about the PILOT funding within a month, including how much the town is getting.

“We’re getting numbers from different sources,” he said.

One of those numbers came from the Connecticut Conference of Municipalities (CCM), which released an estimate of $5,447,785 in PILOT funds for Windham the upcoming fiscal year, an increase of $1,737,264 increase from what was budgeted.

Rivers said the town budgeted for less PILOT funding than it thought it might receive to prepare for the possibility Gov. Ned Lamont might reject the higher PILOT amount.

However, Lamont approved a PILOT increase.

“It’s all good news,” Rivers said.

He said the town has only been getting PILOT funds based on 30 percent of the assessed value of the properties.

Rivers said the formula has changed and Windham will now get 50 percent of the assessed value of the properties.

“That is a nice chunk of change,” he said, noting the town has a lot of property eligible for PILOT funds.

Rivers said if there is extra PILOT funding, it will go into the reserves, which he said the town needs to increase because there is bonding for several projects coming up.

Having a good reserve fund is seen as essential to getting good bonding rates.

Large projects that are currently underway are the downtown garage, Windham High School renovation and senior/community center.

Rivers said the town is currently working on increasing the fund balance.

“There’s a lot of good news, but that doesn’t mean we’re going to start passing money out,” he said.

“It means we’re in a good position going forward to keep taxes down and keep doing these projects like we planned.”

Johnson said there was $8.2 million in the fund balance for the last fiscal year, according to the audit that was completed for the 2019-20 fiscal year.

That is about 10 percent of the operating budget.

“I think we’re striving to get to 12 percent,” Johnson said.

He said if the town reaches 12 percent, he expects the Standard & Poor’s bond rating to improve.

Follow Michelle Warren on Twitter - @mwarrentc.

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