AUBURN – The schools won’t see any proceeds from the sale of Mount Auburn Avenue property but will be allowed to use their rainy day fund, councilors said Thursday.

The City Council completed work on a $66 million budget for both city and school operations that reduces property taxes by $1.48 million and the average property tax bill by 4 percent.

Councilors will take the next week off, reconvening on April 28 to vote on the budget. Voters get the final say on the school budget at a May 6 referendum.

School officials adopted their $34.2 million school budget Wednesday night, managing to stay within a $15 million property tax limit. They did it by doing away with 16.5 positions – including 10 layoffs.

The school’s budget also included about $350,000 from the sale of the Mount Auburn Avenue property – at one time a day-care center – and councilors couldn’t agree to that. Councilor Ron Potvin suggested rescinding a 2004 requirement that the schools keep 1 percent from the rainy day fund instead.

“It’s a requirement placed on the schools by the City Council,” he said. “I suggest instead of letting them keep those proceeds, they use that full fund balance.”

School officials said it sounded like a fair alternative. Superintendent Tom Morrill said the schools were already planning to use $248,000 from the $575,534 rainy day fund. Closing it out would easily pay for most of the school’s programs.

But it would take away a safety net that had been mandated by a previous City Council, and that does carry risks.

“You don’t know what is going to happen, and we would have to come back to the City Council for help if we were to run into trouble,” Morrill said.

School Committee member Bonnie Hayes said she didn’t like that risk.

“It’s good to have something in the kitty, just in case,” she said. “I think a rainy day fund is a good thing to keep in your pocket.”

Councilors all agreed the idea was fair. They’ll vote on the matter at the April 28 meeting.

Tax rate

Getting the proceeds from the Mount Auburn Avenue sale on the city side of the budget meant that councilors were able to lower the tax rate. They came into Thursday’s workshop proposing $38.9 million in property tax collections, down about $1.13 million compared to the current year.

On the city side, councilors did it by cutting a part-time city clerk position, a public works position, and additional cuts to vehicle, equipment and gas and oil accounts.

The city budget also removes $100,000 from the rainy day account, transfers $1 million worth of Tax Increment Finance money into the general fund, and creates an emergency transport function for the Auburn Fire Department’s emergency response.

Adding the $460,000 from the Mount Auburn Avenue property sale to the city budget means cutting $1.48 million in property taxes. That will bring tax bills down by $118.55 for a $160,000 home next year.

“We did a good job,” Councilor Ron Potvin said. “I think there was still more we could have cut, but we can get to that next year.”