PHILLIPS - Town Manager Lynn White was busy laying-off employees Monday, including himself. The reason: Voters rejected exceeding the $256,076 tax levy limit for municipal operations on Saturday.

The budget funds were needed for the fiscal year that begins July 1.

Saturday's town meeting was adjourned after the vote denying a tax levy increase. No expense articles were approved, White said, so he can't even spend the $256,076.

"As a result, I have no authority to proceed to spend any money for this town," White said. "I'm in the process of laying off people. Everybody is going, including myself. I plan to work, but I won't be paid."

There are roughly 20 part- and full-time town employees, he said, not including stipend on-call firefighters. White was included selectmen and Planning Board members in his employee figures.

Town officials are going to ask Franklin County commissioners to cover essential public safety needs for fire and emergency medical ambulance needs, he said.

Everything else will be closed, including the transfer station, said White, who became town manager about two weeks ago.

"I have no choice legally. I have no recourse," White said. "As treasurer of this town I want to make sure I do everything exactly correct."

Selectmen called an emergency meeting Monday night to develop a plan for a future budget vote.

The proposed budget is $1.7 million, which includes about $692,537 for the town's share of the SAD 58 budget, White said. The school assessment, which increased, will be paid because that was authorized by voters on June 10.

The town is changing from a calendar year budget to a fiscal year budget as of July 1. Voters met in April to approve a short-term budget to cover February through June 30 expenses.

In years past, voters agreed to exceed the tax levy, White said.

The last full calendar-year budget was $1.56 million in 2007, former Town Manager Karen Olivieri said.

She is now Rangeley's finance director.

Olivieri said that when she became Phillips' town manager, the town uses a budget that already factored in the revenues. She changed it to a budget that showed what was proposed to spend and revenues were factored in afterward to reflect what was needed in taxes.

Selectmen's Chairman Eric Kinney said Monday night's meeting was to see what selectmen could and could not do.

The way it looks, town government is going to have to remain closed until another town meeting is held, he said.

"We're going to do what we can," he said. "We don't want to do anything we cannot do."

Selectmen planned to pick a date for a new town meeting Monday to get the process rolling as soon as possible, Kinney said.

"People apparently are concerned about the budget and that's why this happened," Kinney said. "We didn't even get to talk budget (Saturday) because the meeting was adjourned and we didn't get to expenses. This is a learning experience."

Saturday's warrant article on exceeding the tax levy limit was moved to the front of the warrant by selectmen, Kinney said.