Meeting in special session Saturday, Medford's town council informally approved a new formula for estimating unpaid taxes that could mean little or no tax increase this year.
State statute obligates municipalities to annually estimate the amount of taxes they will not be able to collect in the year ahead, and to include a "reserve for uncollected taxes" in their budget calculations.
Mayor Frank Czekay told council that Medford last year collected 97.18 percent of its taxes and that, under its standard estimation formula, it would need to create a reserve this year of $2.4 million.
But Czekay, a lawyer and certified public accountant, informed his colleagues that he discovered last week that the state allowed two other formulas and that one of those could cut $1.1 million from the amount of taxes the town needed to raise this year.
"If these numbers hold," he said, "we should be able to go to zero" with the tax rate.
All the other council members said they approved the new formula, provided township solicitor and auditor deemed it proper.
Township Manager Christopher Schultz had projected a 3.7-cent increase in the 2013 tax rate, which would have cost the average homeowner $122.
Under the formula Czekay has recommended, the town could project collecting 98.38 percent of taxes this year.
Czekay said he believed that the new number was a realistic figure because there were likely to be fewer appeals this year of property-tax assessments. Last year's townwide revaluation prompted an unusually large number of appeals, he said.
He also said the town's new tax collector was "very aggressive" in pursuing unpaid taxes.
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