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Portsmouth Pulse > Blog > City Government > City Council > Portsmouth needs a tax cap
Affordable HousingCity CouncilOpinionReal Estate

Portsmouth needs a tax cap

Editor
Last updated: 2025/02/25 at 10:41 AM
Editor Published February 25, 2025
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On January 15, 2025, Portsmouth City Hall announced the proposed FY 2026 budget will be $153.7 million dollars. This amount represents a 6.13% increase ($ 8.9 million) over last year’s budget (FY 2025 $144.9 million) and was more than twice the rate of inflation.

Portsmouth preliminary budget: $8.9 million increase 

Five days later on January 20, the City Council directed City Hall to return with a budget with a 2.9% increase.  Last year’s inflation rate (December to December) was 2.9%

Portsmouth council wants city budget hike capped at 2.9%

A 2.9 % increase from last year’s budget will be $149.1 million.  This means $4.6 million dollars of proposed spending increases needs to be taken out of the proposed FY 2026 $153.7 million budget.

From a historical perspective, the city’s budget ten years ago for FY 2016 was $101.04 million dollars. The cumulative inflation rate over the last ten years was 32.28%.  So, if Portsmouth’s city budget increases had matched inflation for the last ten years, this year’s FY 2026 budget would be $133.7 million dollars.  Instead, it’s a staggering $20 million dollars more. 

City close to passing first $100M budget   May 26, 2015 Portsmouth Herald $101.04 Million Dollar FY 2016 Budget

AMENDMENTTOFY16PROPOSEDBUDGET.pdf   FY 2016 Final Budget 

If City Hall fails to reduce the proposed budget by $4.6 million as the City Council directed it to do, it’s time for the City Council to finally accept reality. The big spenders in Portsmouth City Hall are congenitally programmed to profligately spend other people’s money.  The only solution will be for Portsmouth to join eight other sensible New Hampshire municipalities that value government efficiency and mandate fiscal discipline through the enactment of a tax cap.

Below is additional information about tax caps around New Hampshire.

Dover, Rochester, Somersworth, Manchester, Laconia, Franklin (first city in NH to have a tax cap), Derry, and Litchfield all have tax caps.  Tax caps can be overridden with two thirds vote of the governing body.

NEW HAMPSHIRE TAX CAP ENABLING LEGISLATION 

Section 32:5-b Local Tax Cap.   

Section 32:5-c Adoption of Local Tax Cap.

ROCHESTER TAX CAP ORDINANCE

DOVER TAX CAP ORDINANCE

On January 15, 2025, Portsmouth City Hall announced the proposed FY 2026 budget will be $153.7 million dollars. This amount represents a 6.13% increase ($ 8.9 million) over last year’s budget (FY 2025 $144.9 million) and was more than twice the rate of inflation.

Portsmouth preliminary budget: $8.9 million increase 

Five days later on January 20, the City Council directed City Hall to return with a budget with a 2.9% increase.  Last year’s inflation rate (December to December) was 2.9%

Portsmouth council wants city budget hike capped at 2.9%

A 2.9 % increase from last year’s budget will be $149.1 million.  This means $4.6 million dollars of proposed spending increases needs to be taken out of the proposed FY 2026 $153.7 million budget.

From a historical perspective, the city’s budget ten years ago for FY 2016 was $101.04 million dollars. The cumulative inflation rate over the last ten years was 32.28%.  So, if Portsmouth’s city budget increases had matched inflation for the last ten years, this year’s FY 2026 budget would be $133.7 million dollars.  Instead, it’s a staggering $20 million dollars more. 

City close to passing first $100M budget   May 26, 2015 Portsmouth Herald $101.04 Million Dollar FY 2016 Budget

AMENDMENTTOFY16PROPOSEDBUDGET.pdf   FY 2016 Final Budget 

If City Hall fails to reduce the proposed budget by $4.6 million as the City Council directed it to do, it’s time for the City Council to finally accept reality. The big spenders in Portsmouth City Hall are congenitally programmed to profligately spend other people’s money.  The only solution will be for Portsmouth to join eight other sensible New Hampshire municipalities that value government efficiency and mandate fiscal discipline through the enactment of a tax cap.

Below is additional information about tax caps around New Hampshire.

Dover, Rochester, Somersworth, Manchester, Laconia, Franklin (first city in NH to have a tax cap), Derry, and Litchfield all have tax caps.  Tax caps can be overridden with two thirds vote of the governing body.

NEW HAMPSHIRE TAX CAP ENABLING LEGISLATION 

Section 32:5-b Local Tax Cap.   

Section 32:5-c Adoption of Local Tax Cap.

ROCHESTER TAX CAP ORDINANCE

DOVER TAX CAP ORDINANCE

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TAGGED: Budget, Taxes
Editor February 25, 2025
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