CARMEL – A public hearing held Monday night about the anticipated effects of the Palesky tax cap was labeled a scare tactic by some residents and good planning by others.

At issue were two referendum questions town residents must vote on come Nov. 2 in addition to the tax cap.

The first question asks voters to allow the town to borrow $115,000 to purchase a new firetruck, which under the tax cap proposal would need approval by two-thirds of voters at a state election.

The second question asks voters to agree to pay between $1.25 and $1.75 per bag for trash pickup if the tax cap is approved.

Under the Palesky proposal, property taxes would be capped at 1 percent of their assessed value.

Both questions are designed to prepare the town to deliver needed services even with the deep budget cuts projected under the tax cap initiative, according to Town Manager Tom Richmond.

“If it does go into effect, we need to be prepared,” Richmond said during Monday’s meeting at the elementary school. “It’s not in the town’s best interest to go to this.”

If Carmel is forced to drop its mill rate from $18 per $1,000 of valuation down to $10 under the tax cap proposal, services including trash pickup, new road construction and the recreation program would be axed as of Jan. 1, 2005, Richmond said.

“January 1 you get rid of your rubbish anyplace you can find to put it,” he said.

Richmond and selectmen fielded several complaints Monday night that the two local questions are intended to scare residents into voting against the tax cap. Some of the 50 people in attendance questioned why the firetruck and trash pickup issues must be voted on concurrently with the Palesky initiative, though both issues hinge on the outcome of the tax cap.

“Why is this not taking place after the [Palesky] vote?” asked resident Ted Harris.

If town officials wait, however, any services that extend beyond the 10-mill cap would have to be approved next June in a statewide referendum, three months after the town budget is made final, Richmond said.

One resident worried that the wording of the trash pickup question later could allow town officials to charge per bag even if Palesky fails.

“I’m giving you a free hand to charge me more money,” he said.

“We don’t spend a whole lot of extra money in this town,” said Selectman Jay Deane, who told residents he supported the tax cap until learning more about how it would be implemented. “I think there’s so many things up in the air.”

One man, who declined to provide his name, garnered applause from several residents when he gave his thoughts about the rising property taxes.

“If we don’t vote in favor of [Palesky], that tells Augusta we like things just the way they are,” he said.