AUGUSTA — The potential tax increase from the proposed city and school budget would decrease from 6 percent to 3.4 percent under budget changes proposed by Mayor William Stokes at a tense workshop Thursday.

And, Stokes said, the changes if followed as he outlined them would not have a direct impact on educational programming.

However, the school department would have to spend $414,000 more from its fund balance or rainy day fund, which includes unspent money generally reserved for emergencies or to help offset future years’ expenses.

City officials have no authority to tell school officials how to spend or fund their budget. Councilors’ only role in the school budget is approving the total budget itself, as part of the city budget, and they cannot order changes to school department line items, nor require it to take money from its fund balance.

“The school department can spend it how it wants,” Stokes said, acknowledging the inability of councilors to do anything more on the school budget other than change the bottom line.

At a special school board meeting Tuesday, interim Superintendent James Anastasio outlined potential budget cuts the schools could make if the school system were directed, by councilors, to cut between $600,000 and $700,000 from the school budget.

The options discussed by board members, according to David Rollins, a councilor at large, who attended the school board meeting, included not granting any increases to teachers and other staff, cutting 18 to 22 teachers and other staff members, eliminating funding for sports and other after-school activities or closing the east side’s Hussey Elementary School. Neither administrators nor board members proposed anything similar to Stokes’ proposal to take more from the schools’ fund balance.

Jeffrey Bilodeau, an at-large councilor bristled at what he said was an implication councilors had asked school board members to cut that much, and a press account of the school board meeting.

“We haven’t put anything out about closing schools, cutting 22 jobs and getting rid of teachers,” Bilodeau said. He said it is disingenuous of school officials to lead residents — many of whom emailed to city councilors criticizing them — to believe the council was requiring those drastic steps.

Anastasio agreed councilors had not asked for those cuts but said the school board discussion seemed necessary to prepare for future “what if” scenarios because he had heard several city councilors, last week, say they couldn’t support the total budget as proposed, with a 6 percent tax increase.

Officials at the sometimes heated council budget workshop Thursday also expressed concern about relying so much on fund balance to pay for ongoing operations.

Taking an additional $414,000 from the approximately $1.6 million fund balance, on top of the roughly $800,000 school officials had already planned to take from it, would deplete it to around $400,000. Though Anastasio said the schools typically return about $600,000 to the fund balance ever year.

Stokes said there would be a proposal on next week’s council agenda to approve the budget, with his proposed changes.

Once approved by councilors, the school share of the budget is scheduled to go to voters in a citywide referendum question on Tuesday, June 11.

Rollins and Councilor Mark O’Brien, Ward 4, urged delaying that vote for two weeks, so Augusta could have better numbers from the state if progress is made on the state budget.

Councilor Michael Byron, Ward 1, argued there is no benefit to waiting.

School and city officials said school staff morale is low partly because teachers and other members of three employee bargaining units are working without contracts and have gone years without meaningful raises.

Stokes’ proposal would also use savings from two areas where school officials said Augusta may be able to save about $150,000.

Part of Gov. Paul LePage’s state budget would shift some of the responsibility for paying teacher retirement costs from the state to local school systems. Anastasio included $452,000 in the budget to pay those costs should the governor’s proposal pass as part of the state budget. However, state officials have said that estimate is high, and have suggested Augusta’s share of teacher retirement costs would be closer to $360,000.

Also, the cost of insurance came in lower than budgeted, with costs increasing 3 percent, instead of the 10 percent increase in the budget.

Together, about $150,000 in savings could result in those adjustments.

LePage’s state budget proposal would suspend state revenue sharing payments to municipalities for two years, which would cost Augusta about $1.7 million in revenues each year.

City Manager William Bridgeo’s original budget banks on the city receiving revenue sharing money from the state. If it doesn’t, replacing that lost revenue with property tax proceeds would increase property taxes an additional 6 percent, to a 12 percent increase over the current year.

Cutting city staff so the loss of state revenue sharing would have no impact on taxpayers would require cutting 35 workers from the city’s 204 person staff, according to Bridgeo.

Bridgeo said if revenue sharing is cut from the state budget after the city budget is approved, his recommendation would be to take the $1.7 million from the city’s fund balance for this year, and prepare to make major cutbacks in spending and city services the following year to make up for the loss of revenue sharing.

About 35 teachers and other school staff clad in matching blue shirts greeted city councilors on the stairs of Augusta City Center this evening as councilors and Board of Education members got ready to meet to discuss the proposed $52.6 million city and school budget.

Keith Edwards — 621-5647
[email protected]

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