OLD LYME–Volunteer First Responders could see up to $1,000 more per year in incentives over a longer timeframe if voters approve a change to the local law books at the Town Budget Meeting on May 19.
Proposed amendments to the ordinance affecting members of the Old Lyme Fire Department and Old Lyme Volunteer Ambulance Association would raise the incentive, which is part of efforts to recruit and retain more members, from $1,000 to $2,000 per year for each volunteer.
The proposed ordinance would also allow volunteers, who served for at least 25 years, to continue receiving the benefit even if they aren’t active volunteers anymore.
The town meeting on the 2025-26 proposed budget, which comes in at $45.39 million, will give residents and qualified taxpayers the chance to vote on five ordinance proposals in total. Four are revisions and one is new.
Old Lyme Fire Department President Robert McCarthy in an interview at the Town Hall this week said the fire and ambulance companies asked town officials to consider updating the existing ordinance on the volunteer incentive. The proposed amendments were approved unanimously by the Old Lyme Board of Selectmen on March 3.
State law in 2021 was updated to allow cities and towns to expand the incentive program, which had been implemented locally in 2002.
Initially, the ordinance existed to give volunteers a break on their taxes. But McCarthy said the program has evolved along with the town’s retirement fund for volunteer fire and ambulance personnel.
The last major change came in 2018 at a time when federal law looked at property tax reductions received by volunteers as taxable income. McCarthy said town officials addressed the problem by working out a plan to deposit the incentive into the retirement account instead of using it as a tax abatement. He said the plan was vetted by Town Attorney Jack Collins and an attorney with Pension Administrative Services Inc.
Volunteers that year were given the option to continue with the tax abatement or take the money in the retirement account, McCarthy said. Any volunteer who joined the fire department or ambulance association subsequent to the 2018 agreement received the benefit as retirement savings.
“With this ordinance, we’re trying to revisit it all and see if we can let people have a choice again,” he said. “They’ll be able to get the tax abatement if they desire, or they can still have the money put into a retirement account instead.”
The town also puts money into the retirement fund each year separate from the incentive authorized through the tax abatement ordinance, according to McCarthy. He said that benefit currently amounts to about $980 per year.
In the proposed 2025-26 town operations budget, which is also up for a vote at the May 19 Town Meeting, the emergency services retirement line item amounts to $172,000.
That’s enough money to provide 61 volunteers with the proposed $2,000 incentive, according to budget documents.
There are currently about 55 fire department and ambulance service volunteers in the retirement plan currently, according to McCarthy.
Old Lyme Tax Collector Suzanne Thompson said about 20 of those volunteers opted to receive the incentive as a tax abatement.
McCarthy said using the $2,000 incentive as a tax abatement can be more advantageous for some volunteers than for those whose tax bills don’t amount to $2,000.
“Say we’ve got a young member who owns a car and their taxes are at $400 a year,” he said. “They should let the money go to the incentive plan and get all of it into their retirement account rather than only getting $400.”
He said allowing members to continue receiving the benefit once they are no longer actively responding to calls is an important change. He pointed to members who have been volunteering for more than half a century and are slowing down.
“And they’re the ones that, under the current abatement, wouldn’t be able to get it for the rest of their lives,” he said. “They’re 70-years-old now and have been doing this for 50, 60 years.”
The 2018 retirement plan states that volunteers are vested after six years of qualified service. Benefits are paid out after members stop serving or they turn 65, whichever comes first.
He said volunteers over the age of 65 would likely choose the tax abatement option.
The Annual Town Budget Meeting will be held at 7:30 p.m. on Monday, May 19 in the Town Hall Meeting Room.
