CAPE ELIZABETH — The Town Council adopted a combined $33.2 million municipal, school and community services budget Monday night, and sent the school budget to a May 14 referendum.

The $22.5 million school budget for fiscal 2014 was pressured by revenue losses and added costs from the state, and included the approval of a pilot program for all-day kindergarten next school year.

The $9 million town budget maintains services and includes $10,000 for the town’s fitness center, an expense that had faced elimination during budget deliberations.

The total spending is up 3.5 percent from this year, although it could be higher depending on how the state budget develops in the coming weeks.

The proposed state budget funds about $2.9 million of the School Department’s budget, leaving Cape Elizabeth taxpayers responsible for the remaining $19.6 million.

The budgets require an overall tax rate increase of 56 cents, or 3.5 percent, to $16.40 per $1,000 of assessed valuation.

One of the largest unknowns in the budget is whether the state will eliminate municipal revenue sharing, which Town Manager Mike McGovern said could leave a $640,000 gap in the budget. The current budget assumes the state will continue the funding.

The School Department is taking a more cautious approach toward the state budget. It expects to bear some, although not all, of a proposal to shift teacher retirement costs from the state to local districts. Currently, the state pays for 100 percent of teacher retirement costs.

The $300,000 the department has budgeted for new pension costs accounts for about half of the school budget increase of 3.3 percent.

The board also increased the contingency fund by 40 percent, to $140,000, in an effort to reduce the impact of expected future state curtailments.

Teacher salaries will increase 2.2 percent, under a three-year contract with the schools.

About $151,000 has been budgeted for capital improvements.

A 2012 town facilities study said the district could need $10 million in the next decade for improvements and maintenance.

The school budget validation vote will be held from 7 a.m.-8 p.m., May 14, at Cape Elizabeth High School. Absentee ballot are now available.

In addition to voting on the school budget and providing guidance for the board if it’s rejected, voters will also be asked if they wish to continue with the budget referendum validation process.

The process, which is in its sixth year, requires towns voters to decide every three years if they want to continue voting on school budgets.

Will Graff can be reached at 781-3661 ext. 123 or wgraff@theforecaster.net. Follow him on Twitter: @W_C_Graff.