May 24, 2020

Revenue shortfall sends Calais back to budget talks

CALAIS — A $62,000 state revenue shortfall will force the City Council back to the budget table. The council has scheduled a workshop for 6 p.m. Monday, July 20.

Pam Bridges, city finance director, said councilors have several choices. They could increase the tax rate from an estimated $22 per $1,000 valuation to $22.23, cut services or take more money out of surplus.

If the councilors decide to increase the property tax rate to $22.23 per $1,000, Bridges said, taxes on a $50,000 house would increase a total of $62 over last year’s bill for the 1998-99 fiscal year. Last year’s tax rate was $21 per $1,000 valuation.

A public hearing to approve changes in the budget is scheduled for Thursday, July 23.

Last week, city officials learned there would be a shortfall of nearly $62,000, but $34,000 of that amount was offset by changes in property valuation. The state initially told the city it would receive $390,000, but later cut that to $328,106.

Last month, the council narrowly approved a $7.5 million school and city budget.

The councilors held a string of workshops and meetings to draft the 1998-99 budget, and they considered several major cuts in services, but in the end, the council approved a budget of $7,582,984.

The municipal budget of $3,988,978 was 3.2 percent higher than last year.

Although the school committee had asked for a 15 percent increase over last year’s local share, the councilors pared that back to a 7.5 percent increase. The total school budget is $3,594,006, with $1,252,300 of that amount coming from local property taxes.

To defray a portion of the potential property tax increase, three councilors and the mayor voted to take $59,254 out of the city’s surplus account. Officials estimated the tax rate would be $22 per $1,000 property valuation, up from a $21 per $1,000 tax rate last year.

At the time the council approved the budget, finance director Bridges said property taxes on a $50,000 home for the coming fiscal year would be $1,100, or $50 more than last year.

On June 30, Bridges said, the city learned that its state revenue-sharing funds would be $62,000 less than the estimate the state made a week before.

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