LEWISTON — If all goes to plan, taxpayers in the city will get some relief on next year’s tax bill.

After some tough decisions, officials are proposing a budget for 2020-21 that would lower the property tax rate by 24 cents. If approved in May, it would be the first tax rate decrease since 2008.

As the impact of the COVID-19 pandemic became apparent, the City Council set a goal of a zero percent increase, and officials have spent the last few weeks scrambling to find cuts to the proposed municipal and school budgets.

On the city side, the cuts will include 12 vacant positions that will not be filled. Six layoffs will likely be avoided through further cuts on the school side, which is counting on federal coronavirus relief funding to make up the difference.

“It’s been an interesting year, but I think all-in-all this budget is where it needs to be given the economic uncertainty still ahead of us,” Finance Director Heather Hunter said during a budget workshop Thursday.

City Administrator Ed Barrett said the 12 vacant positions include two police officers, a fire inspector, several Public Works employees, and more.

Much of the decision-making by staff was driven by an estimated revenue loss of about $1.6 million for next year based on the pandemic. Barrett said the city could look at restoring the positions if the revenue projections end up being “too pessimistic.”

The proposed tax rate of $28.67 per $1,000 of assessed valuation would represent a $48 savings for a property valued at $200,000.

For Lewiston, it would be the first time the tax rate did not increase since 2012-13.

“I think it would mean a lot,” Mayor Mark Cayer said. “I think we have the opportunity to provide some meaningful tax relief at the right time.”

During a School Committee budget workshop Wednesday, Chief Financial Officer Bobbi Avery said the department is expecting roughly $2 million from the federal coronavirus relief bill, about $718,000 of which will be used toward the $1.1 million in budget cuts proposed by the committee.

To make up for the cuts on both sides, the city and school departments are planning to use money from their respective fund balances — a “rainy day” fund — to soften the blow next year.

Combined, Barrett said, the amount used will be roughly $7 million. Hunter cautioned councilors that the measure should be a one-time event.

“We need to be cognizant that this is a one-shot deal regarding the fund balance,” she said. “I can pretty much guarantee we can’t do this two years in a row …”

Councilor Stephanie Gelinas said she could be open to some kind of “compromise” with the budget cuts, concerned that the tax relief will come at the expense of drawing down the city’s fund balance.

But, several others said the pandemic more than qualifies as a “rainy day.”

“This is the time to make that cut in the tax rate,” Councilor Zack Pettengill said.

According to a council memo, most of the estimated revenue losses are expected from state revenue-sharing and motor vehicle excise tax.

Hunter said despite the cuts, the revised budget includes an increase to the General Assistance budget, “recognizing there’s a strong possibility they will see more clients.” The change would also reflect increased revenue from General Assistance due to state reimbursements, she said.

She said the additional Community Development Block Grant funding Lewiston is slated to receive will fill a caseworker position that might have been cut otherwise.

Separated out, the school budget would represent a 41-cent decrease to the tax rate from last year, while the city budget represents a 13-cent increase, along with a 4-cent increase from the county budget.

The budget adoption timeline has also been complicated by the pandemic.

Barrett said the city will adopt the budget that includes an appropriation for the schools, but will not be able to officially adopt the school budget until June, because the referendum has been pushed back to July.

The City Council is set to vote on the budget during the May 5 meeting.


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