74 STATION BULLETIN 346 



Let it be repeated here that town officials are responsible for the 

 immediate supervision of the local property tax, and that all govern- 

 mental units (including the state until 1939) receive money from this 

 source of revenue. Town expenditures, therefore, include payments 

 to other governmental units for their authorized portion of the prop- 

 erty tax. Town expenses are another matter. These involve only the 

 expenditure of money for town purposes, and, obviously, exclude pay- 

 ments to other units. Consequently the commonly, but incorrectly, 

 named "town tax rate" expresses a percentage ratio between an in- 

 ventory of assessed valuation and all the revenue which local units of 

 government levy as a tax on this taxable property (at its location) 

 within the respective towns. It is important, therefore, that an in- 

 vestigator distinguish between town payments (or expenditures) and 

 town expenses. 



It is the purpose of this section of Part II to supplement the gen- 

 eral subject matter, largely descriptive of the fiscal system, with a 

 summarv of an analysis showing the relation of selected factors to 

 the variations in property taxes, payments, and expenses of rural 

 towns. As implied above, two phases of the analysis are apparent and 

 necessarily separable. The first phase is concurred with all expendi- 

 tures including payments to other governmental units. The second 

 phase examines the relation of these factors to variations in town 

 expenses, in which case only that portion of the property tax used for 

 town purposes is involved. This phase is equally applicable to other 

 governmental units, particularly counties and school districts. In both 

 phases some attention is devoted to the interrelation of the selected 

 factors. See Appendices 9 and 10, respectively, for supporting text, 

 charts, and tables. 



An examination of the annual reports of 89 rural towns dis- 

 closes that in 1938 53.9 percent of town pavments w^ere in the form 

 of defrayals to other units of government; 33.1 percent to the school 

 district; 13.4 percent to the county, and 7.4 percent to the state. The 

 average property taxes per town amounted to $23,992, 85.9 percent of 

 the revenue from all sources. 



The total payments and property taxes of towns with more than 

 average population and taxable wealth are much greater than of 

 towns which are below average in these respects. On the other hand, 

 the per capita expenditures tend to decline slightly with an increase in 

 population, whereas they tend to vary directly with assessed val- 

 uation. 



There is a close correlation between population per town and as- 

 sessed valuation per town, and therefore the ratio between these fac- 

 tors — assessed valuation per capita — varies among the towns within 

 rather narrow limits. 



^ However, the discrepancv is of sufficient magnitude to warrant 

 an inquiry into its p-eneral relation to town economv. The amount of 

 total pavments and of pronerty taxes remains relativelv constant ir- 

 respective of the amount of taxable wealth per canita. but pavments 

 and taxes ner capita are more than 50 nercent greater for towns that 

 have f^l.200 or movp of assessed valuation per capita than for towns 

 with less than .^1.000 of taxable wealth per capita. 



