HALLOWELL — City residents are digesting a budget proposal that includes a 11.39 percent spending increase and a 17.39 percent drop in revenue, calling it confusing and surprising.

Hallowell councilors approved the first of three readings of the municipal budget Monday. The draft expenditure budget is 11.39 percent higher than the current year’s, coming in at $6,431,267.  Of that hike, $146,711 is attributed to increased or new tax credit reimbursements or expenditures; capital improvement spending totals $316,300, an increase of $269,600 — or 577 percent — from the current $46,700 budgeted for capital expenses.

The revenue budget is estimated at $832,067, a decrease of $146,517 — or 17.6 percent — from last year’s $978,584, despite state revenue sharing, excise tax and sale of city-owned property line items seeing increases. City Manager Nate Rudy said “a big factor” in the decrease is a lack of carry-forward revenue from this fiscal year.

Rudy said the council could decide to carry funding forward, but he did not account for any in the first draft of the budget. The current budget used $225,000 in carryover funds, which helped remedy errors made when that spending plan was crafted last year.

Resident Eric Perry said he is concerned about the revenue budget, noting that the city should be seeing revenue out of Stevens Commons after investing $600,000 in funding from a 2016 bond.

“My only wonder is we made a $600,000 investment in Steven Commons with an eye towards increasing tax revenues,” he said. “I’m really surprised that our revenue dropped.”

Resident Dick Bachelder, a former mayor and city councilor, said he was “confused” about the budget after seeing Wednesday’s Kennebec Journal report. He said the council should work through the budget and make “selective” cuts.

“My guess is … that this will probably never pass,” he said. “A lot of it will (pass), but I’d be damn selective on it.”

Bachelder said the city was in dire straits for development and money when he was on the City Council in the 1960s. He said he and the council was lucky to keep the “city financially afloat” year by year. Bachelder said the tax bill was less of a concern than the management of city operations, in which he said he was not confident. Referencing a $50,000 budget line for a comprehensive plan consultant, he said he believes city staff could take on the construction of that document.

“I’m more concerned about the management effort to come up with what they came up with (for a budget),” he said. “I’m not the guy to be real critical, but if you ask me, I am (critical).”

Former Councilor Lynn Irish, downtown resident and operator of WhipperSnappers Quilt Studio on Water Street, said that in her experience, the budget starts high and is whittled down as the Finance Committee and the City Council meet. She said she is confident that the budget will be lower when finalized, but she said the need for services in Hallowell is growing as more people move into the city.

“We keep needing more services, and things just cost more,” she said. “The public works garage (and the police station) certainly need … attention.”

The Police, Fire and Public Works departments each have requested some capital improvement budget lines this year. The Hallowell Police Department is asking for $43,000 to cover the purchase of a 2020 Ford Explorer to add to the department’s two-car fleet. Further, a $10,000 study of the the Second Street fire station, which has been floated as a potential location for the department, is included in city’s draft budget.

The Hallowell Fire Department has requested $80,000 for the first year of a seven-year, $500,000 lease-to-own agreement for a pumper truck and a quint truck — which serves as both an engine and a ladder truck.

Another large capital expense — $24,000 — would be for the Public Works Department for the first year of a seven-year, $150,000 lease-to-own agreement for a new loader. The budget also earmarks $10,000 to study a replacement site for the Public Works Garage at 282 Water St. Public Works Director Chris Buck said Wednesday the building is “not accommodating” for the department. Rudy told the Kennebec Journal on Tuesday the garage is not big enough to house modern plowing equipment and has inadequate drainage when snow melts off vehicles.

Resident John McPherson said his initial concern was locking into leases that commit more town funding for five to seven years. He said none of the expenditures seems necessary and said the effect on the city’s property tax rates, which is not yet known or finalized, could rile up residents.

“It’s kind of useless to get fired up over it until these requests are seriously considered by the council,” he said. “I’m sure this (increase) is going to get people’s attention.

“All of it can be used, but sometimes austerity is necessary,” McPherson added. “When people can be told what a potential mil rate increase could look like, that’s when you’ll really hear a lot of strong opinions.”

Rudy said any alarm raised by the increasing budget could be premature, saying “there’s plenty of trimming that needs to be done.”

“It’s so early that the numbers are going to be misleading,” he said. “There are very strong compelling reasons that the department leads had for the recommendations they made; it’s awfully early and I know that people will be following this.”

There will be two more readings at City Council meetings and multiple deliberations by the Finance Committee before the budget is finalized.

 

Sam Shepherd — 621-5666

sshepherd@centralmaine.com

Twitter: @SamShepME

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