By David Harry

Staff Writer

South Portland residents may face a tax increase of 40 cents per $1,000 of assessed value with unanimous council approval Monday of the fiscal year 2012 municipal budget.

The vote was delayed from last month because of questions about allocation of $1.05 million for renovations and expansion at South Portland High School.

Resident Albert DiMillo said he believed excluding the money from the school budget violated state law because it was a school department expenditure that requires voter approval.

After the meeting last month, City Manager James Gailey and Superintendent Suzanne Godin said they received legal opinions that the expenditure did not have to be part of the school budget voters approved May 10.

Councilors rejected DiMillo’s suggestion to reduce renovation funding by the amount of any fiscal year 2011 school department surplus and a request by city resident Marilyn Reilly’s request to remove funding for councilors’ health insurance benefits.

City Finance Manager Greg L’Heureux said the increase from $15.70 per $1,000 of assessed value to $16.10 per $1,000 of assessed value breaks down to 10 cents for the fiscal year 2012 school operations budget, about 10 cents for municipal operations, 20 cents for school renovations and just less than a penny for Cumberland County taxes.

The projected tax rate is based on the fiscal year 2011 property valuations of $3.35 billion. New valuations will be completed later this summer.

After approving the budget, councilors also unanimously approved a 1 percent pay increase for all nonunion municipal employees and set the city sewer rate at $4.33 per 1,000 cubic feet of water consumption, an increase of 15 cents.

Gailey said the wage increase affects 109 full-time and 21 part-time employees.

The $69.27 million fiscal year 2012 budget goes into effect July 1 and includes $28 million for municipal operations spending, an increase of $908,000. The fiscal year 2012 school operations budget of $38.06 million is an increase of $693,000.

City taxpayers will fund $16.83 million of the municipal operations, a 1.9 percent increase of $320,000 from fiscal year 2011.

School operations will require a 1 percent increase of $337,000 from taxpayers; $674,000 of the $1.05 million for school renovations is taxpayer-funded.

Budget documents anticipate increases of $252,000 in excise taxes to $4.22 million and $60,000 in state revenue sharing to $1.74 million.

Gailey’s budget showed few changes by councilors except the addition of $52,000 in salaries for two new part-time firefighters next January. The budget also restored $4,500 to purchase bags for pet waste. 

The addition of two part-time firefighters comprises a large part of the $129,000 budget increase in the fire department’s $4.32 million budget. The overall public safety portion of the budget will increase $400,000 for fiscal year 2012 and includes $136,000 more for police services. The public works budget will increase by about $30,000.

Staff Writer David Harry can be reached at 282-4337, ext. 219.