PORTLAND — City property owners can anticipate a tax increase of 47 cents per $1,000 of assessed value based on school and municipal budgets proposed at Monday’s City Council meeting.
The overall 2.3 percent increase in property tax revenues would boost the tax rate to $21.10 per $1,000 of assessed value from the current $20.63.
City Manager Jon Jennings and School Board Chairwoman Marnie Morrione said the increases could have been greater.
“Had we just settled for a status-quo budget from last year, the city would be facing an estimated 5 percent tax increase,” Jennings said of his proposed $236 million municipal budget that includes revenues and expenditures for city enterprise funds that do not require property tax revenues.
Morrione said the anticipated loss of $2.7 million in state Department of Education subsidies was expected to lead to a 4.5 percent tax increase. Legislators restored $1.34 million of the subsidy, so the increase in property tax revenues was reduced.
The $103.6 million school budget was unanimously forwarded to city councilors March 29. The budget will be reviewed this month by the council Finance Committee, but councilors cannot alter specific line item spending, only the bottom line.
In terms of the overall 2.3 percent tax increase to fund municipal and school operations and the city obligation for Cumberland County operations, the municipal budget contains an increase of 26 cents per $1,000 of assessed value, and the education budget will increase the tax rate 21 cents per $1,000 of assessed value.
The municipal budget is the first drafted by Jennings since his appointment as city manager last summer, and he said it was a reflection of stated council goals and his own desire to concentrate on improving city services.
“It is our hope we will begin a community conversation about the core functions of government in Portland,” Jennings said.
Changes that have already occurred include the creation of the Housing Safety Office, a liaison within the Police Department to assist opioid users in getting treatment, and a new Health and Human Services program to help General Assistance voucher recipients find employment.
More changes are coming, Jennings promised: a new inspections and permitting office will open to streamline handling of permit applications, management of the city parks and open spaces will be shifted from Public Works to a new Parks, Recreation and Facilities Department, and a sustainability coordinator will be hired.
Jennings said a big change will come in Health and Human Services with the proposed closure of the India Street Public Health Center. The services provided there, including the Portland Community Free Clinic, will not be eliminated, but will be shifted to the Portland Community Health Center at 180 Park St.
The shift will maximize use of federal reimbursements, Jennings said.
“In no way should this be taken as the city abdicating its public health responsibilities,” he said.
The health center will also handle school-based health care, and take on dental health care next year, Jennings said.
The shift from India Street is expected to be complete by Jan. 1, 2017, city Finance Director Brendan O’Connell said Tuesday. The health center expenditures are budgeted at $607,000, a $597,000 reduction from the current budget.
Overall, the proposed municipal budget will eliminate almost 13 full-time positions, while $125,000 has been allocated for the city to conduct an overall assessment of its compliance for public accommodations with the 25-year-old Americans With Disabilities Act.
Jennings said the revamped Public Works Department will focus on basics, using dedicated teams in districts throughout the city.
“Paving roads or fixing broken sidewalks may not be the most glamorous of undertakings, but they are the foundation of what makes a great city,” he said.
The financial demands of a 14 percent increase in health insurance costs and a 4.6 percent increase in debt service primarily related to paying off the $112 million borrowed in 2001 to pay unfunded obligations to the Maine State Retirement System were challenges noted by Jennings, but he also saw promise in city growth.
The overall valuation of city properties increased $68 million to almost $7.8 billion, and expected revenue increases in other taxes and licensing and permit fees add almost $1.3 million to offset the need for property tax revenue.
The proposed municipal budget will require $83.8 million in tax revenue, up from $81 million in the current budget. Jennings noted the overall tax increase is the smallest required in five years.
The municipal budget will also be reviewed this month by the Finance Committee, beginning Wednesday, April 6, at 3 p.m. in City Hall. A full hearing and vote schedule is available at the city website.
The school budget faces a May 2 City Council vote before the state-mandated May 10 referendum vote. A council vote on the municipal budget is scheduled for May 16.
Portland City Hall, 389 Congress St.