AUGUSTA — City councilors said proposed state revenue cuts are primarily to blame for the 6.6 percent increase in property taxes which would result if the proposed $52.6 million city and school budget were to be approved as is.

Councilors had their first crack at the budget Thursday, getting an overview of a city budget proposed by City Manager William Bridgeo and a school budget recently approved by the Augusta Board of Education.

But much of the discussion Thursday was not about local spending; it was about the state budget proposed by Gov. Paul LePage, and how it could impact both the city and school budget.

LePage’s budget, which is currently being debated by the state Legislature, would cut state revenue sharing to municipalities, which Augusta Finance Director Ralph St. Pierre said would cost the city nearly $1.7 million in revenues.

The governor’s budget proposal would also shift a larger share of teacher retirement costs onto local school systems. Interim Superintendent James Anastasio included $452,000 in additional contingency funds to cover the potential extra cost of picking up a larger share of teacher retirement costs, though state officials have said the impact will be lower than that.

City councilors said they have to set the budget despite not knowing how much state funding will be approved by the Legislature.

“The shortfall coming in revenues is directly related to not being funded by the state,” said City Councilor David Rollins. “I want to make it clear to the community, this isn’t mismanagement. This is a firestorm being handed down to us by state government. We’ve all received some emails from constituents. Some not in the best of tone. Some accusatory. But it is certainly not our city manager or school system that has us in this situation. This isn’t something we created. Nobody likes this and nobody wants this for our community, and we’re going to do the very best we can for everybody.”

Bridgeo drafted his proposed budget assuming LePage’s proposal to cut all state revenue sharing to municipalities would be rejected by the Legislature and included just under $1.7 million in state revenue sharing funds as revenue for the city. He said he has heard from some state legislators they think revenue sharing to municipalities will be restored in the state budget.

“The wildcard that could raise the stakes for the city and some extent the school could be that I didn’t budget for a loss of revenue sharing,” Bridgeo said. “That’s a $1.6 or $1.7 million figure. If the Legislature and governor arrive at some sort of compromise that costs us revenue-sharing money, we’ll have to deal with that.”

With no state revenue sharing, Bridgeo said, the tax rate would have to increase another 6.6 percent to fund the current budget. Or to cut the budget enough so the loss of the $1.7 million in revenue would have no impact on taxpayers, the city’s workforce of 204 would have to be reduced to 169 — a loss of 35 people, or 15 percent of the workforce, according to Bridgeo.

The municipal share of the budget, at $23.6 million, is up $432,000, or 2 percent.

The proposed budget would result in the tax rate increasing from $17.55 to $18.72 per $1,000 of property valuation.

Mayor William Stokes said most budget deliberations will take place at televised council meetings this year in an effort to increase public involvement in, and knowledge of, the budget. Council meetings are generally broadcast live on local access television CTV-7 and streamed both live and available for later viewing on the Internet. 

Thursday’s meeting was the first council budget deliberation.

The next budget session is scheduled for April 11 with a focus on public safety. Council debate on the school budget is scheduled for April 18. The council’s work on the budget is tentatively scheduled to be complete by early June.

Keith Edwards — 621-5647
kedwards@centralmaine.com