NEW GLOUCESTER — The Budget Committee voted Thursday night to recommend amounts for 11 items in the 2011-12 municipal spending plan.

The 11-member panel, which acts as an adviser to the Board of Selectmen, learned that the board met Wednesday and cut some requests to keep the tax rate increase between 1 and 4 percent, instead of an initial high of 14 percent.

Steve Libby, chairman of the Board of Selectmen, said the undesignated fund balance is shrinking, and although the town is not financially unhealthy at this time, belt-tightening is warranted.

He said the board cut requests for paving projects from $300,000 to $225,000.

The town has historically funded reserve accounts to pay for costly equipment and repairs for fire and highway departments and other costly expenditures.

A Capital Improvement Committee ranks requests from department heads and then selectmen set the bar for funding.

“We can’t continue to fund our reserves and have a reasonable tax rate,” Libby said.

The board is seeking additional information to keep down health insurance costs for the town’s 18 employees.

The Budget Committee also learned that the Morse Road reconstruction project will be funded with $1 million from the Pineland tax-increment financing account.

Bob MacGregor, chairman of the Cable TV Committee, said a request for $8,000 to pay for a contracted technician to trouble-shoot and make repairs as needed should remain in the budget.

Selectman Nat Berry said the board nixed the request solely because of a policy that no new staff be hired.

The Budget Committee approved the following requests:

* Streetlights, $6,000;

* Dispatch, $30,350;

* Water treatment, $5,000;

* Tree care, $2,000;

* General Assistance, $40,000;

* Health officer, $1,000;

* Cemetery, $9,000;

* Health and social services, $4,650;

* Library, $84,409;

* Environmental and Sabbathday Lake testing, $1,500;

* Royal River Snowmobile Club, $2,500.

The committee will meet Feb. 24 to review requests for Fire and Rescue, the Highway Department, Transfer Station and Planning Office.

Selectmen will set the final budget figures and send them to voters May 2.

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