Chester votes down 1% Local Option Tax; Frank Kelley steps up as Town Moderator

By Cynthia Prairie and
Shawn Cunningham
©2026 Telegraph Publishing LLC

The proposed 1 percent Local Option Tax on meals, rooms and consumed alcoholic beverages that would have brought an estimated $60,000 annually into the Chester Housing Commission’s Housing Reserve Fund went down in defeat on Monday night by a vote of 59 to 76.

In an attempt to address the continuing housing shortage in Chester —  part of a nationwide crisis — the Reserve Fund is intended to support the “production of housing and increase opportunities for families and individuals to access affordable homes in Chester.”

The long discussion over Article 7 covered a variety of issues concerning the proposal, including from a short term rental owner who opposed the 1 percent tax but suggested that the town impose an added tax on all sales throughout the town. Several restaurant owners also stood to object to the tax, with one suggesting that diners would travel to Bellows Falls for a meal instead of staying in Chester. Another business owner suggested it would be another burden on small businesses.

Several proponents reiterated that the 1 percent amounted to $1 on a $100 tab and that tourists don’t check to see what taxes are on their bill. Another suggested that Chester needed the housing and the 1 percent tax was a minor way to begin getting that done.

In the end, a ballot vote was called for instead of a voice vote, and Article 7 was defeated. At that point, about 50 voters and non-voting attendees left the meeting.

Kelley takes charge

It was retired elementary school teacher Frank Kelley’s inaugural turn as Chester Town Moderator, taking over for Bill Dakin, who for each Town Meeting night for 40 years stood at the lectern in Town Hall presiding over the citizens business before his retirement last year.

Kelley acknowledged that legacy and the crowd gave Dakin a standing ovation, who was viewing from his vantage point on Zoom.

Then, Kelley got down to business.

Articles 4-20

Prior to the Local Option Tax vote were votes by the full house of voters Monday night on Articles 4, 5 and 6. All passed easily by voice vote.

They are:

•  Article 4: $70,000 for a new Police Department cruiser;
•  Article 5: Borrowing $100,000 to fund a matching grant for Route 35 construction and Thompson Road easement purchase.
•  Article 6: $4,461,054.94  to be raised in property taxes to fund the budget approved by the Select Board in January. The total budget is more than $4.4 million but the remainder comes from other revenue sources.

With just about 80 voters remaining in the audience, the following social services were voted to receive town funds for the coming year. The total amount is $46,011. They are:

• Article 8: $13,807 for The Visiting Nurse Association & Hospice of VT & NH.
• Article 9: $3,044 for Health Care and Rehabilitation Services.
• Article 10: $3,040 for Southeastern Vermont Community Action, better known as SEVCA.
• Article 11: $900 for the Women’s Freedom Center.
• Article 12: $2,400 for Senior Solutions.
• Article 13: $2,250 for the MOOver of Rockingham transit service.
• Article 14: $800 for Windsor County Mentors.
• Article 15: $400 for Green Mountain RSVP & Volunteer Center of Windsor County.
• Article 16: $1,800 for the Community Cares Network of Chester and Andover.
• Article 17: $4,000 for Meals on Wheels of Greater Springfield.
• Article 18: $5,570 for Neighborhood Connections.
• Article 19: $5,000 for Black River Area Community Coalition.
• Article 20: $3,000 for the Chester-Andover Family Center.

On Tuesday, fiscal Articles 2 and 3 were voted on by Australian ballot.  Both passed overwhelmingly. Article 2 passed 531 yes to 129 no; Article 3 passed 569 yes to 93 no.

Article 2 – Depot sidewalks 

The history of Article 2 dates back to 2017, when the town was awarded $800,000 to rebuild and upgrade the sidewalk from Bargfrede Road on the lower end of Depot Street to Town Hall. The grant came from the state’s Bike and Pedestrian fund. The grant moved forward on most fronts, but was stalled by the Green Mountain Railroad and the Vermont Transportation Department on the issue of an easement for a sidewalk to be built across the tracks by Smitty’s Chester Market.

And after years of pushing on the state and the railroad, Julie Hance, who has been Town Manager since 2020, finally got the easement. But costs had risen and the $800,000 was not going to be enough. Luckily, Hance found that the same grant fund was willing to provide additional money to put the project back on track.

With the project now totaling over $1.8 million, the town has to put up a required match of  $430,000 so the work can go forward and thus the bond issue in Article 2. The Vermont Department of Transportation’s fact sheet says that construction is slated to being in the summer of 2026.

Article 3 — paving and patching 

This more typical article has the town looking for $300,000 to do paving on Flamstead Road, River Street and the Whiting Library parking lot as well as patching Depot Street, which is not on the state’s paving list until 2030. According to Hance, the Depot Street patch work — long a sore spot for the town — will start as soon as the weather allows, with the paving later in the summer.