GARDINER — Some changes in Gardiner and new information will give city elected officials a slightly different budget to consider this year.

City Manager Scott Morelli told city councilors at their budget review this week that increases in the Kennebec County assessment and the proposed increase to the School Administrative Unit 11 budget could increase what Gardiner taxpayers could pay by 2.1 percent.

The county and school district assessment would push the tax rate up by 45 cents, but the city’s decrease of 10 cents would bring the difference to 35 cents, moving the tax rate from $21.60 per $1,000 of assessed valuation to $21.95 per $1,000 of assessed valuation.

Some other changes have cropped up in the seven weeks since Morelli first distributed the city’s proposed budget to the City Council. They include:

• the loss of $1 million in taxable personal property at the Libby Hill Business Park

• expansion of the state’s homestead exemption

• savings in wages and benefits expected from a request by Gardiner Public Library Director Anne Davis to retire in place, which allows her to retire and return to work at a lower rate of pay

• adjustments in planning and economic development to cover changes in wages and professional services

• adjustments to the public works budgets resulting from advancing the purchase of some equipment to the current budget year

Gardiner officials also are contending with a change to the homestead exemption. The exemption, given to Maine homeowners who have lived in their home for at least a year, knocks $15,000 off the value of a home for property tax purposes. By expanding the exemption to $15,000, state lawmakers agreed to refund to municipalities about half of what they would lose by the change. Morelli said Gardiner stands to lose about $60,000 after the state payment.

Morelli said 40 percent of the city’s taxpayers will see either no increase or a tax decrease in their bills because of the exemption, and about 100 homeowners are expected to get increases ranging from $1 to $62. He noted that not all residents who qualify apply for the exemption, but the city provides information in their tax bills about the program, and he encourages people to sign up.

Even with these adjustments, the municipal portion of the budget still represents a decrease of 10 cents per $1,000 of valuation.

Although councilors had time to start debate on the budget, most agreed to delay that until they hear from Gardiner taxpayers. City residents will get to have their say on the budget starting next week. Public comment on the budget is scheduled for May 18, when the budget is expected to be moved to its first reading. The council will continue to take public comment June 1 and June 22, when the budget is expected to reach its second and final reading, and city councilors could vote.

In the meantime, councilors are mulling a couple of ideas that surfaced at the budget review.

Councilor Maureen Blanchard, who serves at large, suggested tapping the city’s fund balance for $180,000 to apply against what taxpayers would be asked to pay, essentially wiping out the increase that city councilors approved a year ago and lowering the city’s tax rate even more than the budget in its current form does.

Morelli said it’s possible to do it. The city’s auditors recommend keeping a certain amount of cash on hand, and allocating money from the fund balance would not jeopardize that. Gardiner elected officials used fund balance in the 2013 fiscal year to minimize the tax increase they were putting before taxpayers.

The risk, however, is in using one-time funds to pay ongoing bills.

“It’s not really a savings,” at-large Councilor Jonathan Ault said. “There’s no revenue to offset that expense.”

Blanchard also floated the idea of mocking up tax bills for the school district and the county to send to taxpayers, to emphasize the effect of other governmental bodies on what city residents pay.

But Mayor Thom Harnett said he’s not interested in demonizing the work of another elected board.

“It’s grandstanding, not governance,” he said.

District 4 Councilor Phillip Hart said he was concerned about spending $53,000 on a rescue boat for the Gardiner Fire Department at this point.

In his budget review, Al Nelson, Gardiner’s fire chief, said the purchase would replace a boat that’s not suited for water rescues.

“It’s a fishing boat,” he said. “We can’t get anyone on a backboard into the boat.”

While councilors did not discuss the budget in great detail, they did talk about their approach to their role in the process.

“In my view,” Harnett said, “ultimately we vote the budget up or down. As a matter of personal style, I defer to the experts, the city manager and the department heads. I have personally no interest in having a line-item veto, but I can’t prevent any councilor from proposing amendments.”

Jessica Lowell — 621-5632

[email protected]

Twitter: @JLowellKJ