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Compromise May Be Near for Deep River Horse Tax Issue

For the past three months, talk of horses and taxes has been fresh on the lips of Deep River resident farmers, as well as the members of the Board of Selectmen. An almost constant agenda item of Board of Selectmen (BOS) meetings, the issue has been recurring and still awaits a resolution.

When the issue of the personal property tax on horses was first broached in May, the selectmen, led by First Selectman Angus McDonald, agreed that they would look into the matter, investigate how other towns in the state dealt with it, and come back to the residents with their findings.

Horse owners in town were hoping the personal property tax, which originated when horses were viewed as vehicles, will be discontinued as it was in Essex in 2014.

Killingworth is among the 30 of 169 towns in the state that have discontinued the horse tax. Killingworth put a $20,000 cap on the tax, which means that all horses under the value of $20,000 are not taxed, but those worth more than $20,000 are taxed the same way a motor vehicle is, at 70 percent of the assessed value.

After investigation and discussion, McDonald came back to the Deep River horse owners in town and explained that he felt that a fair compromise would be to follow the Killingworth model; his suggestion was met with some resistance. Some expressed concern that there was no clear and concise way for the town to assess the value of a horse.

McDonald explained that the burden of truth would be put on the horse owners, as it always had been, to be forthcoming about their own horses and their worth. Horse owners explained that the value of a horse can change at the drop of a hat. The BOS explained that in the case that a horse was to lose value due to injury or illness, vet records could be used to help assess the changed value of the horse. Horse owners explained that’s not how vet records work.

Currently there are 54 horses on record in the town of Deep River and none are listed with a value of more than $20,000.

At the July 23, Board of Selectman meeting, the subject was once again on the agenda, and the audience was full of horse owners awaiting the decision.

“My thinking is this: We had a good long conversation about it, I’ve done a ton of research on it, I learned some things I didn’t know. I thought I proposed a fair compromise and it was not received well. There was argument back and forth and it was pretty much said that if we went with the compromise proposal and put a cap on the tax of $20,000, we would end up in court,” McDonald said.

“I am not inclined to put the town in court and spend taxpayers’ money for a lawsuit I think we would win. So, I think now we are at all or nothing. Do away with the tax altogether or leave it status quo as it is. If I had to make a decision tonight, I would not take any action and let the tax remain status quo. I feel we have been painted into a corner,” McDonald said. “This is my opinion, there are two other voices on the BOS.”

Selectman Jim Olson addressed the effect of nixing the tax. The town had earlier estimated the total horse tax brings in about $4,500 in yearly revenue to the town; Town Assessor Robin O’Loughlin noted that the tax on a horse worth $10,000 brings in about $185 a year.

“Forty-five hundred dollars doesn’t seem like a lot, but when you are doing the town and Board of Education budgets, $4,500 is a lot of money,” Olson said. “If there is an extra snow storm or something like that, this is money we could use, and if there are threats of being taken to court, all the taxpayers will end up paying, not just the horse owners.”

He added, “My own personal opinion, leave it the way it is.”

Selectman Duane Gates proposed that the horse tax be phased out over time, but only with some kind of assurance from the horse-owning community in town that if that avenue was taken, there would not be a lawsuit.

“Could we phase out the tax over a couple of years? I am trying to find a happy medium for everyone,” Gates said.

Gates offered an example that the tax remains the same this year, is capped at $20,000 next year and then maybe is done away the next year. This way he said, the town is prepared to lose the revenue and horse owners know the tax is going away soon.

Both Kevin Wakelee of Larimar Show Stables, a vocal proponent of doing away with the tax and who is currently party to an unrelated wrongful assessment lawsuit against the town, and McDonald expressed their appreciation for Gates’s attempt at a compromise.

For now, the tax remains status quo and no changes have been made, though the conversation will be continued. McDonald said the issue would return to the BOS agenda only when there is new information either from the horse owners or the BOS.