Once again, the issue of semi-annual tax billing was brought before the Andover Board of Selectmen at a selectmen’s meeting in November. Analysis shows that the cost to the Town of borrowing money is not insignificant.

From 2006 to 2012, the Town has paid $79,602.70 in interest to borrow money in order to pay our bills. Our financial year begins on January 1, but our tax bills don’t go out until November. The Town begins to run out of money in June each year, requiring us to borrow from the bank to keep the town running until the tax payments for the year start arriving in December.

Andover’s representative at the New Hampshire Department of Revenue Administration (DRA) has been telling us we’re one of the last towns to still be on an annual billing schedule. Most other towns have recognized and realized the benefits of not having to borrow money to pay their bills. The Board of Selectmen voted unanimously to begin semi-annual billing in 2014.

This means that instead of receiving one bill in late November of this year for your entire 2014 property tax obligation, you’ll receive one bill in June of this year for about half your 2014 property tax, and a second bill in late November for the rest. Payment for each of the two bills will be due 30 days after the bill is mailed, and the usual interest and penalties will accrue after the due date of each bill. But no tax liens will be filed based solely on a taxpayer missing a June payment.

Because the tax rate is set in November every year by the DRA, the June tax bill is an “estimated” tax bill based on half of the previous year’s total tax obligation. The November bill then makes up the difference between the June bill and the taxpayer’s total tax bill for the current year, based on the new rate that DRA sets in November.

Two tax bills a year will give the Town better cash flow and will reduce the need for the Town to borrow. Analysis shows that with an average cost of $11,000 per year in interest on borrowing, versus about $1,250 to cover the cost of issuing a second tax bill every year, the savings to the Town would be about $9,750 per year, or about $7.31 on the annual tax of a $200,000 property.