The Hallowell City Council meets Monday night over Zoom. Screenshot via Zoom

HALLOWELL — An initial draft of Hallowell’s proposed municipal budget for fiscal 2021 includes $6,860,145 in spending, an increase of $357,001 — or 5.49% — to current spending.

No action was taken on the proposed budget Monday night, when the City Council met over Zoom.

City Councilor Maureen AuCoin called the budget “very preliminary” before she and other councilors held a brief discussion on the proposal.

A memorandum included with meeting documents reported the City Council’s first action on the spending plan is expected in April.

The city budget in Hallowell receives three readings before becoming official, with each reading typically introducing more changes.

The draft budget proposes spending $92,217 on the first year of a seven-year lease for a new fire vehicle, and $45,000 for a police cruiser. The cruiser purchase would not include trading in another cruiser. Instead, the used cruiser would be transferred to the Fire Department for use as an incident response vehicle.

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Road maintenance is budgeted at $150,000, an increase of $100,000 to current spending. The increase “reflects deferred maintenance,” according to city officials.

These items represent the bulk of a 262% increase to the capital improvements budget, which ballooned from $108,000 to $282,965 in the initial draft.

AuCoin said the city is considering bonding for future projects, which could include relocating the city’s Police Department to the Second Street Fire Station or a new home for the city’s Public Works Department. AuCoin said the bond also could be used to take some expenditures out of the general fund.

“Some of these things may be things we want to hold off on, and put into that bond,” AuCoin said.

City officials said they anticipate a 7.6% increase in Hallowell’s insurance costs, from $462,315 to $497,693. They also said administrative costs could increase about 2.8%, from $265,578 to $273,043.

Utility costs are expected to jump 17.8%, from $59,876 to $70,548. Most of the increase comes from doubling the street light repair budget, from $5,000 to $10,000, and a $6,000 increase in electric costs for street lights. The former covers the purchase and installation of utility poles and street light heads, while the latter covers electric costs to all lights and merges some expenses in the budget.

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Initial funding for the Hubbard Free Library is set at $42,000, the same as current spending. AuCoin cited two potential increases in funding to the library, which could help it expand its hours. She said $13,000 in additional funding could allow the library to open Fridays, while $26,000 would fund an additional 10 1/2 hours of operation each week.

The city’s Police and Fire departments have been budgeted to receive increases of 3.27% and 3.26%, respectively.

The city is expecting a 1.1% decrease in debt services, from $256,417 to $253,559.

New items in the budget include:

• $33,000 for a retirements plan for the Police Department.

• $30,000 for consultant work on ordinance amendments related to the comprehensive plan.

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• $25,000 in contingency funds.

• $20,000 for the newly formed IDEA Task Force.

• $7,500 for a historic district survey.

• $6,000 for parking enforcement.

• $5,000 for coronavirus-related expenses.

The proposed budget does not include funding for summer recreation programs, which city officials do not expect to offer this year due to the COVID-19 pandemic.

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The initial budget also anticipates no increase in spending for Regional School Unit 2 or on Kennebec County taxes. Like in fiscal 2020, the budget proposes spending $3,211,817 on schools and $277,099 on county taxes.

City revenues are budgeted to decrease by 64.2%, but, according to a memorandum, the draft spending plan does not include state-funded revenue projections, property valuation projections or estimates of tax increment financing funds.

The Bank of Maine Ice Vault is also looking for an extension to its tax increment financing district, which councilors plan to discuss at a future meeting, according to AuCoin.

City Councilor Diana Scully asked Monday night how the city stands to benefit from the $1.9 trillion federal relief package.

City Councilor Kate Dufour said there was not enough information about how that money is to be distributed, but assumed the funds will come with “strings associated with COVID-related expenses.”

“I think it’s too early,” Dufour said, “to tell how we will be able to use that money.”

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