Augusta leaders are within weeks of voting on a nearly $100 million budget for the next fiscal year.
That spending plan, as currently presented, could increase property taxes by about 20%. That number is complicated — and perhaps exacerbated — by an ongoing citywide property revaluation. City leaders expect to vote on a final version budget by April 30.
Here’s what to know as the Augusta City Council wades into its last budget-refining meetings.
COST DRIVERS
The largest increases to the city’s proposed budget come in salaries and benefits. About 80% of the city’s workforce is union-represented and subject to a bargained contract, most of which include annual cost-of-living increases.
In the police department, total increases were about 8%, driven by union-negotiated increases that were “required to fill our ranks and retain our current staffing levels,” City Manager and former police Chief Jared Mills said in an initial budget report.
Insurance and retirement benefits are increasing by just over $300,000. That increase can mostly be attributed to a jump in retiree benefits for employees hired before 1992 — a cost the city is obligated to pay — by $230,900.
CUTS IN THE MEANTIME
During its four budget meetings so far, council members have identified and removed $251,291 in spending.
A lower-than-expected county budget — which ends up on city property tax bills — will cost the city’s taxpayers $30,000 less than budgeted. The city also saved $50,000 in water and sewer costs after the Greater Augusta Utilities District finalized its rates and $30,000 in maintenance to the city’s police station, where a building warranty just expired.
Most of the reductions, though, come from the Public Works Department’s budget. City leaders cut a total of $130,000 through reductions in building repairs, rental equipment and contracted services in both regular highway maintenance and snow plowing.
SCHOOLS’ INCREASING COSTS
Last month the Augusta School Department, which makes up close to half of the city’s overall $97 million budget, approved an increase of $3.7 million over last year’s spending. Augusta taxpayers would need to fund $3.2 million of the increase.
City Council members appeared split during discussions over the school department’s asks in a budget meeting on March 31. Despite school board votes on the spending levels, city councilors can limit the level of spending the schools take to voters in the June referendum. The school board then determines where that money is spent.
Ward 4 Councilor Eric Lind said he was particularly concerned about the rate of growth in school costs: If the school budget is adopted as presented, property tax contributions for education in Augusta will have gone up by about 57% since fiscal year 2024.
“When you take a step back, the growth in school funding, the ask for property taxes is really significantly outpacing inflation,” Lind said. “Meanwhile, personal income growth in Maine is generally about 2% to 3% per year. For me, that begs the question: How can we ask the taxpayers to absorb property tax increases that dramatically exceed their own financial growth?”
Other councilors, including At-Large members Stephanie Sinkiewicz and Courtney Gary-Allen, opposed Lind’s suggestion to “drive to zero” in increased costs. That kind of cut would require gutting essential services, Gary-Allen said.
“I am one councilor,” Sinkiewicz said, “but I don’t want to balance the budget on the backs of the kids who need it most.”
THE REVALUATION
Looming over the budget process is Augusta’s ongoing property revaluation — a rebalancing of property tax burden that is required by the Maine Constitution to ensure taxation reflects actual market value.
Augusta’s last full revaluation was completed in 2006.
The revaluation, expected to be complete this summer, is expected to place a much larger burden on residential property in Augusta. Currently, residences are assessed by the city at 42% of their market value, while commercial properties sit at about 77%.
While the city will still collect only as much money as it needs to fund city services, residences are expected to take on a much bigger slice of that pie.
TAX INCREASE
The original budget proposal suggested Augusta could see a tax increase of more than 21%. The current property tax rate is $24.40 per $1,000 of assessed valuation.
But given recent cuts and the potential for much more — Mills, the city manager, said the council is considering freezing some vacant positions to save up to $500,000 — the actual tax increase will likely not be quite that high.
Final numbers will be decided in the coming weeks for several more city departments.
The City Council plans to review budgets for eight final categories this week and finalize a budget proposal during a meeting on Tuesday, April 21.
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