For the city tax rate to remain flat next year, Concord city councilors would have to cut roughly $2 million off the spending plan proposed by City Manager Tom Aspell, according to city estimates.

As weeks of hearings draw to a close, councilors will workshop any changes they’d like to see before an expected vote on the budget at a meeting Monday night. As proposed, it totals $170.5 million, with an overall $40 million spending increase mostly due to capital projects and a 3.89% rise in the property tax rate.

That increase would bring the rate to about $9.88 per $1,000 of assessed value, adding about $130 onto the city portion of the annual tax bill of someone who owns a $350,000 home. 

Each 1% of the tax increase currently represents about $525,000 in the budget, according to an email Aspell sent councilors responding to their questions. For the tax rate to remain constant — at $9.51 – councilors would have to cut about $1.95 million. 

The proposed budget currently applies $561,000 of unassigned fund balance dollars to cushion the tax blow, keeping the rate increase under 4% — something celebrated by the city manager in his transferral letter and by some members of the council. Last year, councilors used almost $300,000 of unassigned fund balance money to pay for additions they made to Aspell’s proposed spending plan, which carried a 3.95% tax rate increase. 

Fund balances are uncommitted amounts of money often used for emergencies or unexpected spending needs, including, at times, to trim taxes. Including what they applied to the budget last year, councilors spent more than $1 million in the 2024 fiscal year — mid-year approving cash for plow drivers and to the police department for extra overtime and bonuses aimed at boosting retention, and the purhcase for PFAS-free firefighter gear. The city currently has more than $25 million in unassigned fund balance, according to a presentation by Aspell. 

The general fund budget, the primary driver of the tax burden, is growing 6%, in large part related to pay and benefit increases — determined by collective bargaining agreements that are negotiated away from the budget cycle — including a 10.5% jump in health insurance rates.  

Major sewer and water projects and plans to design a new police station contributed to the proposed doubling of the city’s capital budget to $53 million. In the 2026 fiscal year — when debt payments will start on bonds for projects approved now — the capital budget is forecasted to double again to more than $100 million as major building projects like the police station, Beaver Meadow Clubhouse and Loudon Road bridge come before councilors. Decisions about a new fire station, new library, and updates to the City Hall campus are also on the council’s five-year horizon.

On Thursday night, councilors took note of major special spending pools — and whether they will bolster or bruise the general fund in the coming years. 

The city plans to demolish and rebuild the terminal at Concord’s airport, in large part paid for by a grant from the federal government to build a new airport terminal that the council approved earlier this year.  At the time, the project was expected to be paid for without a major bond, according to city reports, but this year’s budget includes $1.4 million for it. 

Some councilors expressed disappointment in the planned demolition of the current terminal — a 1938 building among the first in the state — to make way for the new one. 

Aspell emphasized the need to move urgently on the project — saying that delay would likely mean federal grant money would expire before it could be used.

He described the new terminal – and the economic growth it could bring with available land for development in the area – as “more important than Steeplegate.”

At the same time, the city can’t count on that project increasing how much money the airport puts in city coffers, Aspell told councilors at a meeting Thursday. 

While the bond for the project is applied to the airport fund, not the general fund, it is one of the reasons the city expects the airport fund to no longer be self-sustaining by 2027.

Airport revenue relies on space rentals and fuel sales. Many of the rental contracts the city has with companies can not be renegotiated, and fuel sales depend on traffic in and out, Aspell explained when councilors noted airport revenue seemed low.

“Much of the airport activity as you picture sales and uses of airplanes… it’s really economy dependent,” Aspell said. “As the economy goes, so goes the airplanes.”

Without a rise in recreational flying or other major growth, the city manager’s office projects diverting around $200,000 of property tax dollars to the airport each year starting in 2027. 

The golf fund, conversely, is expected to net about $125,000 gain in 2025. Aspell noted that such money, and a bump in membership and course fees, would be used to help pay for a new clubhouse — a proposal still on hold — if the council followed through on it. The $900,000 for a new, larger parking lot a the course this year does not draw on property tax dollars. 

Throughout hearings, councilors have asked questions about the possibility of using impact fees to boost city revenue. Impact fees charge developers for additions to public infrastructure needed to accommodate their projects. Under state law, an upgrade to existing infrastructure has to be required because of an individual development for it to be eligible for impact fees. 

Monday’s meeting, held 7 p.m. at City Hall, will also open a public hearing for residents to share their thoughts on the spending plan.