Staff Writer

While confronting declining revenues in state aid and excise taxes, Town Manager Tom Hall and council finance committee members are presenting a $32.31 million budget for fiscal year 2011.

The budget, which was part of a public hearing Wednesday, after the Leader deadline, will be subject to a second reading and council vote May 5.

The $32.31 million, which includes a $4.42 million capital improvements and equipment bond, is part of a total gross budget of more than $70 million for municipal and education operations and the town share of the Cumberland County budget.

While the total budget has been reduced from the current $72.11 million, reductions in state aid to education and municipal revenue sharing mean an increase in property taxes of about 3.9 percent.

Of the increase of 48 cents per $1,000 of assessed value, Hall said 17 cents will pay for municipal operations, 30 cents for school operations and a penny will go to the county. The 48-cent increase will add $144 in taxes on a property valued at $300,000.

The budget initially proposed by Hall was reviewed by the council finance committee of Judith Roy, Shawn Babine and Karen D’Andrea. Among changes made is $57,000  added for contributions to social service agencies that help residents.

Hall initially proposed eliminating all but $8,500 to be contributed to the Scarborough Land Conservation Trust and $10,000 to Project G.R.A.C.E.

Hall said how the money will be distributed has not been determined, but Roy and D’Andrea both felt it was important the money is available.

Municipal appropriations will be reduced on the whole, including $174,000 less spent at public works and more than $98,000 less in the finance department. The police department appropriation was increased by $195,000. An amendment in the labor contract with the Scarborough Benevolent Police Association representing about 30 patrolmen, sergeants and detectives saved about $60,000 as union members swapped a 3 percent pay increase for a promise of no layoffs in the next year.

While considering the municipal budget, councilors have been asked by residents including Dave Green to present a budget with no tax increase, but councilors including Babine and Mike Wood have said a flat budget is impractical.

Both councilors asked residents to bear in mind that last year’s budget with no tax increase was difficult to create and the current proposed increase still amounts to an average of a 2 percent increase in the last two years despite a tough economy.

While state general purpose aid to schools has been reduced from the promised $7 million in fiscal year 2010 to about $5.68 million, state revenue sharing for the municipal budget has been reduced by more than $251,000, Hall said.

Other aid reductions mean the town will see $698,000 less from non-town sources for next year and Hall also anticipates a decrease of $150,000 in vehicle excise taxes.

Hall assumes town property valuations will increase by $20 million this year, although the final amount will not be known until summer when Town Assessor Paul Lesperance completes his annual assessment.

Taxable values will also increase because of a reduction in the state Homestead Tax reimbursements.

Within the capital improvements plan budget is $2.23 million to begin work at the intersection of Route 1 and Haigis Parkway. Turn lanes will be extended or added to the intersection as a first step to alleviate congestion there and in the Dunstan Corner area.

Staff writer David Harry can be reached at 282-4337, ext. 219