South Portlanders’ property taxes will increase 5.9% with the City Council’s approval Tuesday of the $127 million combined municipal, school and county budget.
The new budget is $12 million, or 10.4%, higher than this fiscal year’s, with $76 million of it funded by taxes. The property tax rate will increase 86 cents, bringing it to $15.56 per $1,000 of assessed value. The owner of a $400,000 home will pay $6,224 in property taxes, $344 more than this year.
“I hate this increase, I’ve hated it since we started,” Councilor Linda Cohen said. “There will be parts of this budget some people in the community will absolutely hate and they will badmouth it on Facebook, and then there will be other people who will love the things that those people hate.”
The municipal portion of the budget is responsible for 19 cents of the tax rate increase and the school department, 44 cents. County taxes, up 35.7% from this year, add the remaining 23 cents of the increase.
City officials said they would have had to cut over $1 million from the municipal portion of the budget to make the tax rate increase noticeably lower. The school budget was approved by voters June 14 and the county tax is out of the council’s control.
A major driver of the new budget is an expected rise in costs associated with providing general assistance to the homeless population. Much of that increase will be offset by state and federal programs and grants, however, meaning those general assistance costs have little impact on the tax rate.
Between salaries, overtime, pensions, health benefits, and more, over half of the $55.7 million municipal portion of the budget goes toward personnel costs.
“We are doing a very generous budget for the employees this year for pay raises to keep pace with inflation, with other communities,” City Manager Scott Morelli said.
Councilors said while personnel costs represent a hefty portion of the budget, the expenditure is an “investment” in the city.
“Mostly, we are investing in our human capital, in our human resources,” said Councilor Misha Pride. “Last year we were really sparse with the raises because the reevaluation was near, and we’re doing better by folks, and I can appreciate that.”
The city’s roughly $6 million capital improvement plan allocates $2.1 million for environmental protection projects and over $1.1 million for public safety. Another $1.4 million will go to general government projects, including $525,000 for a community broadband network project.
Funding of $593,000 will go to cultural and recreational facilities; $525,000 to public works and transportation; and $237,000 for parks and open spaces.
“These are things that come from sources that do not generally impact the tax rate,” Morelli said.
Tax relief is available to some residents, Morelli said.
“Let’s say if you’re paying $5,000 a year in taxes now, and this increase of (nearly) 6% is $250 or $275 more a year,” he said. “If anyone finds that increment to be the amount that really pushes them over the edge, you can always appeal to the City Council through the social service office for a hardship abatement.”
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