HALLOWELL — City councilors moved forward with a $6.49 million spending plan Monday, setting up a final reading for the next time the council meets.

The second reading of the expenditure and revenue budgets, which is traditionally a recommendation from City Manager Nate Rudy, was passed by a 6-1 vote during a Zoom meeting of the council. Councilor Maureen Aucoin dissented because she did not believe a number used in the budget related to the city’s tax increment financing was correct.

Hallowell City Manager Nate Rudy speaks Monday during a Zoom meeting. Sam Shepherd/Kennebec Journal image

The third reading, which finalizes the budget, will likely be held at the Aug. 10 meeting of the council.

Councilor George Lapointe, who is the chairperson of the Finance Committee, said there are still “some items to discuss and work our way through” before the budget is finalized.

The draft budget showed $6,489,437 in total expenditures, which is 1.46% higher than the $6,396,018 budgeted last year.

Municipal spending stands at $3,000,521, while the city’s payment to Regional School Unit 2 is increasing 4.88% from $3,062,505 to $3,211,817.

Hallowell’s share of county taxes are on the rise in the draft budget, from $266,560 this fiscal year to $277,099, up 3.95%.

The draft budget also shows $303,834 in payouts for TIF accounts.

An initial draft of the budget showed $356,060 in possible capital improvement expenditures, which is a large increase from $136,000 used last year. In the latest draft of the budget, that number was cut to $94,060.

Those cuts include a cut $50,000 line for a police cruiser, $70,000 for the first year of a fire truck lease and $75,000 for bulkhead decking repair. On Monday, City Councilors accepted $15,000 in grant funds to repair the bulkhead from the Harbor Management and Access Grant Program Matching Grant. Councilors also appropriated $52,800 in downtown TIF funds to fund the rest of the project, and $8,000 for plywood decking if it is deemed a necessary holdover before major repairs are done.

Cuts in the budget this year may lead to a build-up of deferred costs which may strain the budget in the future. Rudy wrote in a memo that lines for vehicle and equipment replacement and building maintenance budget will “average … $458,000 in each of the next five fiscal years.” He recommended in the memo that the City Council “review its options with respect to a bond” for upcoming expenditures, including a fire vehicle and construction on a Public Works facility and new police station.

Other large cuts include a $27,000 reduction for sidewalks and a $90,000 reduction in road maintenance.

The city’s community service budget is also being heavily cut, from $72,087 to $26,283.

Utilities costs are decreasing, from $76,026 to $60,776, spurred by a $17,000 decrease in costs for street and traffic lights, along with small increases and decreases on other lines.

The second reading budget also eliminates all $44,000 recreation funding. Most of that funding, $38,600, was due to fund Hall-Dale Summer Rec, a child care program that is not operating this year due to the coronavirus pandemic.

Police department costs saw a slight decrease, from $357,211 to $345,422, a large portion of which is a $7,645 decrease in Police Chief salary.

The city’s insurance costs are increasing 11%, from $416,300 to $462,315.

Funding for a new assistant city clerk position, $29,474, still remains in the draft budget. Lapointe said Rudy has been sitting on a number of applications during the coronavirus pandemic and waiting to see if the position is needed.

The city’s municipal revenue is estimated to be $1,061,397, an increase 5.47% from last year’s budgeted municipal revenue of $1,006,315. That increase can be attributed to a new TIF revenues line, which injects $100,000 from the city’s TIF district into the budget, but that funding can only be used on certain projects.

State revenue sharing, which is expected to be much lower for all municipalities this year due to the coronavirus pandemic, is expected to bring $175,996 in revenue to Hallowell, down from $219,996 last year and as much as $326,000 in fiscal year 2009.

The city is also expected to offset either at $86,959 in costs through TIF funds.

Rudy estimated that the property tax rate could be $21.50 per $1,000 of property value, an increase of 20 cents over the current rate.

 

NEW OFFICERS APPOINTED

Also Monday, Sgt. Christopher Lewis and Ofc. William Towle were appointed to the city’s police department. Those appointments come two weeks after the Kennebec Journal reported that the full-time staff, five officers, would be reduced with two officers leaving.

Lewis spent the last eight years as the Topsham Police Chief and left that position earlier this month, according to the Times Record. Police Chief Scott MacMaster said Lewis lives in Augusta and was looking to get back into “community policing” in a slower-paced position.

MacMaster said three applicants were interview for the sergeant position and all of the city’s part-time officers and six applicants from a job search in January were contacted for the officer position.

The Kennebec Journal reported in April that Towle had initially accepted a full-time position with the Richmond Police Department, where MacMaster was previously the chief, but later withdrew his application.

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