NORWAY – Selectmen have agreed to reduce their recommended fiscal 2009-10 budget again because of uncertainties in state revenues.

The recommended cuts will come from the Highway Department and lower cost-of-living raises for nonunion town employees.

“I’m sure no one is particularly happy with anything we’ve had to do,” Town Manager David Holt said. “I’ve tried to look at everything fairly.”

Holt recommended to the board at its Thursday meeting that $5,000 be taken from the road improvement budget and $2,500 from the in-town street improvement budget. Additionally, he has recommended that the previously recommended nonunion cost-of-living increase be decreased from 2.5 percent to 2 percent for a savings of $3,778.

The action is being taken to meet the latest anticipated state revenue cuts and to stay within the confines of LD 1, legislation signed into law by Gov. John Baldacci in 2005 to increase the state share of education costs, reduce property taxes and to place a cap on government spending at all levels.

Selectmen Bruce Cook, Russ Newcomb and Warren Sessions agreed with the recommendations. Selectmen Bill Damon and Irene Millett were unable to attend the meeting.

Holt told the board that the state appears to be cutting funds in areas such as block grants for roads. Additionally, Holt said he believes he may have overestimated how much money Norway would receive from the tree growth reimbursement fund. The total impact of additional lost state revenues to Norway may be as much as $15,000, he said.

In April, the majority of the Budget Committee agreed with the Board of Selectmen’s recommendation to institute a 2.5 percent across-the-board, cost-of-living increase for town employees.

The cost-of-living increases, which total $22,507, were part of the overall $6,787,114 budget that the majority of the Budget Committee and the Board of Selectmen approved. The number includes the town budget of $3,781,009, the county budget of $291,011 and the SAD 17 budget of $2,715,104.

All departments had initially submitted budgets with no pay raises, with the exception of the police union, which negotiated its contract for a 3 percent hike, in order to keep costs down.

Holt told the board Thursday that the town is finding it difficult to meet the state’s LD1 requirements but until there is a better method, he thought it was best to go along with those guidelines.

“I also think it’s important to stay under the cap,” Newcomb said. “While I don’t think it’s ideal, until we get enough people to change it, we need to do something.”

Cook said “Augusta” is doing things that make it almost impossible to run municipalities and give people decent raises.

Voters must approve the budget at the June 15 annual town meeting.

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