GARDINER — City officials say a property tax increase is inevitable because of increased costs and decreased funding from the state.
City Manager Scott Morelli presented a recommended budget to the City Council on April 16 with an 8 percent tax hike, including expected spending increases from the school and county.
Councilors at their meeting at 7 p.m. Wednesday at City Hall are expected to provide feedback and suggestions for possible changes to the budget that will take effect in July. The city will hold public hearings, probably in June, before the budget is approved officially.
Mayor Thomas Harnett, who is also a council member, said the city is doing everything it can to avoid increasing taxes for the residents. He said residents have come to expect the level of services provided by the city, and many of those services are in the interest of public safety.
“We know there are a lot of people that are having hard economic times, and we’re adding to that burden, and that doesn’t feel good,” Harnett said in an interview Thursday. “We’re doing the best we can to maintain those (services) with the least impact possible on our residents, knowing that no impact is not a possibility.”
The proposed increase would raise the current $19.90 per $1,000 of assessed value tax rate to $21.50. That represents a $234.76 increase for the median home’s tax bill in Gardiner. The median home value is $147,000.
The proposed $9,291,963 budget is up 5.9 percent from the current one.
The department requests and fixed-cost increases were about $566,000 more than the current budget, according to Morelli. The city also will have about $289,000 less revenue compared to the current budget, largely because it took $175,000 from the reserve fund last year and is sustaining a drop of more than $45,000 in state aid, he said.
Morelli is proposing to raise taxes to cover the $350,000 gap after a mixture of cuts, rejections of budget requests, the use of $90,000 from the reserve and carrying $70,000 for construction on Highland Avenue into next year, he said.
Harnett said the city has been fiscally conservative in the last four years — asking for only a slight tax increase as a result of the municipal budget in one of those years — but the Legislature has failed to live up to its statutory revenue-sharing obligation.
The city is receiving $530,644 less than what state law mandates for a level of revenue sharing; and the overall budget, including the school and the county expenses, would cause a 0.5 percent tax increase even if the state provided the full amount of state aid.
“With that, as Scott points out, we’re not in this pickle at all,” Harnett said. “We don’t have a bloated budget. We have a very lean budget, but we’re dealing with a situation where we’re almost helpless when it comes to what the state does.”
Harnett and other municipal officials lobbied the Legislature last year not to eliminate revenue sharing entirely, as Gov. Paul LePage proposed. Instead, the Legislature cut it by one-third.
One resident, Maureen Blanchard, of Dresden Avenue, spoke out against the potential tax increase at the last meeting on April 16. She said her income, along with that of other senior citizens, is fixed and won’t rise with any tax increase.
“I’m asking you to think about not raising it,” Blanchard told councilors. “I’m getting fewer services, and I’m paying more.”
George Trask, a resident and former councilor, said in a phone interview Thursday that he plans to attend Wednesday’s meeting to oppose the proposed tax hike.
Trask, 59, said he agrees the city has operated on a lean budget in recent years, but he objects to the amount of funding the city provides to nonprofit organizations, particularly the Boys & Girls Club of Greater Gardiner, Johnson Hall Performing Arts Center and Gardiner Main Street, which combined receive more than $100,000.
“I feel like that money could be used wisely somewhere else. We’ve got streets that are falling apart. They’ve cut about as deep as they can cut,” he said.
Trask, who plans to run for a council seat in November, said he thinks residents shouldn’t be taxed more while funding for those organizations isn’t cut.
“I’ve always been told if you take care of the pennies, the dollars will take care of themselves; and they’re not looking after the pennies,” Trask said of city officials. “In this case, the pennies are $100,000.”