HALLOWELL — The City Council is scheduled to consider a new set of proposed budget cuts Monday that aim to lessen tax increases on residents.

But it’s unclear whether the city’s efforts could lead to action that would pass legal muster, since the tax commitment has already taken effect.

Councilors instructed City Manager Gary Lamb to create the proposal during their meeting on Aug. 22 — the first public meeting since the council rescinded the budget it approved in July. Residents organized a petition effort to force the council to reverse the budget approval after it caused an average 20% increase in property taxes.

Mayor George Lapointe estimated during the Aug. 22 meeting that, if approved, the $300,000 in cuts proposed by Lamb would bring the average tax increase for residents below 10%.

Monday’s meeting is scheduled to be held at 6 p.m. at Hallowell City Hall.

The two options of proposed reductions builds on a slate of more than $231,000 in cuts approved by the council in August. Lamb’s additions to those earlier cuts come entirely from the miscellaneous tax increment financing, or TIF, expenses line of the budget — a $218,000 line which helps the city achieve a 100% capture rate on its TIF funds. TIF is a revenue tool in which a municipality may shelter taxes over a period of time within a designated district to pay for specific projects.

The city is restricted by an agreement with the state on what the TIF funds can be used for, and Lamb said the city does not have many remaining options for what to spend the money on. Other than the miscellaneous line, the budget includes well over $400,000 in TIF expenses, from sidewalks to legal fees.

While substantially decreasing the capture rate would get the city to its desired $300,000 budget cut and 10% tax increase, Lamb said it would also decrease revenue sharing and school subsidies from the state over the next several years, as well as cause the city to pay higher county taxes.

Before a new budget is adopted, though, the city’s tax commitment would need to be rescinded and revised by the Board of Assessors. Lamb said the city attorney is still reviewing whether that’s legal.

He said he hoped to have a recommendation from the city attorney on how to proceed before the meeting Monday.

The Kennebec Journal reached out to the Maine Department of Administrative and Financial Services to confirm the legality of recommitting taxes, but a spokesperson said Friday that since the department has no authority over municipal budgets, it could not comment on the steps Hallowell was taking.

The first installment of the city’s property taxes is still due this month, based on the budget that was approved on July 29. Property owners are obligated to pay those installments and will begin to accrue interest on their tax bills if they are not paid by Sept. 18.