ST. AGATHA – A significant increase in local property valuation and a school budget that lowered the local cost of education has brought about a two mill decrease in the property tax rate for this lake shore community in the St. John Valley.

Together, the two factors could save individual homeowners between $75 and $100 in property taxes this year. The tax rate for 2005-2006 will be 19.25 mills, down from last year’s 21.25 mills.

A factoring of local properties, to bring them more in line with listed state valuations, brought about the increase in municipal valuation. The factoring increased the value of shorefront properties by 20 percent, and other properties by 10 percent.

The new valuations bring the town’s worth up nearly 8 percent.

“This does not take care of all valuation listings, according to the state, but it brings us closer to the state valuation,” Town Manager Ryan Pelletier said Monday.

“It also buys the community some time. Within five years, the town will have to do a revaluation to get back into 100 percent of state valuation,” he said.

A municipal revaluation could cost the town up to $50,000.

The factoring, according to Pelletier, brings shoreline properties close to what the state says they should be valued. Sales of shorefront property are still higher than the new valuation, the town manager said.

Business owners and farmers also will see a decrease in the personal property they pay for equipment.

“It’s unfortunate that our mill rate could have been even lower, by at least one mill, had the Legislature done its job and funded the Homestead Exemption reimbursement at its full 100 percent,” Pelletier said. “I am hopeful the Legislature will see the egregious error in the changes in the Homestead Exemption, and address it in the next legislature.

“We are very close to true tax reform,” he said.

SAD 33, which includes St. Agatha and Frenchville, brought down its budget figures to save St. Agatha $78,000 in local education costs.

St. Agatha selectmen also voted to utilize $200,000 in excise tax revenues and another $80,000 in municipal revenue sharing to reduce the amount necessary to be collected in property taxes.

“It’s a little good news in our day,” Pelletier said.

St. Agatha’s 2005-2006 municipal budget is $1,119,612. Of that amount, 45 percent or $507,479 goes to SAD 33 for local education costs. Another $51,620, 4.6 percent, goes to pay the town’s share of the Aroostook County budget.

Pelletier said explosive shorefront property sales are creating an “enormous potential in the recreation and tourism sectors” of the town.

He said the town has made some significant public infrastructure investments over the last three to five years, and they are looking at further expansions of the public sewer system and other economic development initiatives.

He hopes this will encourage entrepreneurs in discussing business startups or expansions in the community.

He and Paul Bernier, the town’s community development director, are open to such discussions.