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Portland City Council OKs budget, 3.1% tax hike

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Portland City Council OKs budget, 3.1% tax hike

PORTLAND — After months of number-crunching and Statehouse-watching, and two postponements of earlier votes, the City Council's approval Monday of the 2014 fiscal-year municipal and capital improvement budgets was anti-climactic.

The council voted unanimously, in a meeting that lasted less than an hour, to adopt the $215.2 million municipal budget and $16.7 million capital improvement budget as proposed.

With the $96.3 million school budget approved by voters last month, the combined tax levy for fiscal 2014 will be $147 million, divided about evenly between municipal and school purposes.

The 2014 mil rate will be $19.41 per $1,000 of property valuation, according to a city memo, a 3.1 percent increase.

The municipal budget was trimmed recently by the council's Finance Committee to reflect a possible loss of $1.9 million in revenue sharing under the state budget proposed by the Legislature. That budget was vetoed by Gov. Paul LePage on Monday, but legislators were hoping to override the veto this week.

Under a budget initially proposed by LePage, the city stood to lose $6.1 million.

The council's Finance Committee had been trying to postpone action on the budgets until the impact of the state budget was better known. That budget has been the source of contention in the Statehouse for months.

"It's been an unusually difficult year (for budgeting), not because of what the city has done, but because of the challenges in Augusta," Mayor Michael Brennan said.

But despite the budget trimming, Holm Avenue resident Robert Haines warned councilors not to bet on the Legislature's budget surviving LePage's veto.

"I don't know how you can be going through this exercise," he said. "If the veto is sustained, we're not going to get any money from the state for the foreseeable future."

Haines also criticized many of the capital improvement budget allocations, which are funded by borrowing. More than 25 percent of the taxes collected in the city pay the cost of debt service, he said.

"At some point, you have to slow down," he said.

High Street resident Steven Scharf also criticized the use of debt to finance capital improvements. "The problem is that our debt service is becoming a larger and larger portion of the budget," he said.

But Councilor John Anton, the Finance Committee chairman, defended borrowing as an appropriate way to pay for capital improvements, such as changes to streets, facilities and other needs.

"We continue to have a robust, healthy process that surfaces the long-deferred capital needs of the city," Anton said.

William Hall can be reached at 781-3661 ext. 106 or whall@theforecaster.net. Follow him on Twitter: @hallwilliam4.