The South Portland City Council Tuesday unanimously passed the city’s $127.5 million budget which carries a 5.2% tax increase for property owners.
The municipal budget comes in at $57.6 million and the school department’s budget, approved by voters last week, is $66.1 million. An additional $3.8 million in county taxes brings the total budget to $127,548,682.
The new city budget results in an 81-cent increase to the tax rate, from $15.56 to $16.37 per $1,000 of assessed value. The owner of a home assessed at $296,700, the average assessed value of a single-family home in South Portland, according to Finance Director Ellen Sanborn, will pay $4,857 in taxes next year, $241 more than this year.
Mayor Kate Lewis said the 5.2% tax increase is low compared to the rest of the region.
“We, compared to neighboring municipalities, have one of the much lower, if not lowest, tax increase percentages,” Lewis said. “That is something I’m a little proud of this year.”
The combined budget is just $60,500 more than this year’s, but the tax increase results from a decrease in state funding and the dwindling of the federal funds the city received during the pandemic.
Sanborn said the major drivers of the municipal budget include a 6% cost of living increase for non-union workers and inflation’s impact on municipal supplies, services and equipment. No new positions were added.
Extra funding for two capital improvement projects was requested by city staff at the meeting Tuesday, including an additional $300,000 for the community center pool roof and $155,000 for Willard Beach access by Deake Street. For the pool roof, $300,000 had already been allocated but bids for the work came in double what was expected.
“If we don’t get this project completed, we will have to shut the pool down very soon,” City Manager Scott Morelli said Tuesday.
Panels in the roof have degraded due to their exposure to moisture over a long period of time. The new roof will be moisture-resistant and have a 20-year warranty, Facilities Director Don Hopkins told the council. The extra $300,000 for the roof will be allocated from TIF funds and American Rescue Plan Act funding.
An additional $155,000 of ARPA funding also will be used to replace the stair system between Willard Beach and Deake Street.
“In 2017, we started working with FEMA to obtain grant funding to effectively replace the failed stair system,” Morelli said. “Originally the project was about $550,000 – FEMA would pay for 75% and the city would be responsible for the other 25%.”
Since then, the cost has jumped to roughly $700,000 and the federal government is not willing to pay for the coverage. Funding the added cost with South Portland’s ARPA funds will leave the city with $620,000 in city emergency funding.
Neither of those last-minute budget additions will come at a cost to taxpayers, Morelli said.
Sanborn said this is the first year that Maine’s Senior Tax Stabilization program is in effect, and roughly 1,700 homeowners in the city will not see an increase in their taxes because of it.
Councilor Linda Cohen said she is surprised by the number of residents who don’t apply for federal and state programs, such as the Maine Homestead Exemption Program, which can reduce property taxes for qualified applicants.
“It’s not charity,” she said. “It’s something that if you’ve qualified for it, you’ve lived in your home for a certain amount of time, you can apply at the assessor’s office for it … Please check out every option that you have available to help yourself save some money because this was a tough year and next year could be just as tough.”
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