Scarborough workshop focuses on budget cuts
SCARBOROUGH — Progressing toward second readings and votes on the municipal and school budgets for fiscal year 2014, members of the Town Council and School Board finance committees agreed last week that misinformation has colored discussions and a possible $1.40 property tax increase is still too high.
In a two-hour joint workshop on April 11, Councilors Judith Roy, Ed Blaise and Jessica Holbrook and School Board Chairman Christine Massengill and board members Chris Caiazzo and Donna Beeley met to rehash the previous night's budget hearing and determine more ways to reduce a potential boost in the tax rate from the current $13.80 per $1,000 of assessed value to $15.20.
“I thought it was very clear the public will not put up with the increase proposed,” Blaise said. “It is very obvious we didn't provide the information we should provide.”
The School Board second reading for its $41.24 million budget comes Monday, April 22, with a joint Town Council and School Budget budget workshop scheduled two days later. Councilors will vote on the combination of municipal, school and county budgets May 1, before the school budget faces a referendum on May 14.
“It was resounding that it is not acceptable where it is,” Holbrook said about public response to the budgets.
Caiazzo said what may have been unclear is how School Superintendent George Entwistle III drafted the education budget and how the School Department is in effect penalized by steady property values in town because of Maine Department of Education formulations for general purpose aid subsidies.
“The reality is, we are the biggest losers in the state when it comes to that,” he said. “I'd have a hard time explaining the details of it.”
The education budget, which proposes a $5.1 million increase in property tax revenue to help restore programs and make deferred bus purchases, also accounts for the potential $1.6 million loss in state subsidies and a possible requirement to locally fund staff pensions now paid for by the state.
By contrast, Town Manager Tom Hall's $28.2 million budget accounts only for the possible loss of $170,000 in excise tax revenue on commercial tractor trailers, and not potential reductions in state income and sales tax receipts comprising revenue sharing or possible shifts in the manner business equipment is taxed.
The education and municipal revenue questions remain under deliberation as part of Gov. Paul LePage's biennial budget.
“One thing that really flabbergasts me is that we don't have fixed data yet.” Caiazzo said.
Roy suggested questions regarding why the municipal budget does not face a referendum (the 2007 state law requiring school district consolidation also mandated local education budget referendums), but said school and town officials work hard to explain their proposed budgets.
“I don't know how much more transparent we can become,” she said. “With every right comes a responsibility.”
The workshop revealed more details on how the school budget can be reduced by $1.34 million, based largely on about $350,000 in savings on anticipated insurance premiums, shifting about $500,000 to capital improvement spending for buses and technology, and what could amount to $500,000 in reduced debt service because the town has refinanced existing bonds.
Further reductions suggested by Blaise included a suggestion the School Department refuse to pay mandated pension contributions. He advocated pegging property tax increase to the current 2 percent increase in the Consumer Price Index.
Blaise and Beeley also showed differing perceptions on public reaction to the budgets.
"We had (only) 12 people show up here last night," Beeley said.
Holbrook said she suggested limiting any property tax increase to 3 percent during a January council workshop.
"That was what I thought the community could absorb and not have too much heartburn," Holbrook said.
Holbrook did concede the 3 percent is a goal, but not ironclad.
Caiazzo said if the rate is based on emotion, it needs more data to be justified.
"The situation is much more complex than that, I think," he said.
To reach the the council guideline, Roy said the reduction on the entire budgets has to be $2.15 million beyond what has been drafted.
"I just want to be clear, we are not asking for an expansion," Caiazzo said, noting the budget is comprised of 80 percent legal obligations.
Seeking common areas for municipal and education budget reductions, Roy suggested a scheduled 2.5 percent parity increase for nonunion staff be cut back to 2 percent, because each 0.5 percent would save at least $40,000.
Roy suggested another $1 million might need cutting from the municipal and education budgets.
"We have a multiplicity of residents who just cannot afford a major increase," Roy said.