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Due to equipment upgrades, WMHD (Greenville) and WBSQ (Monson) will be shut off during the daytime hours for the duration of this week.

Portland city council considers tax increases and one-time funding to fill budget shortfall

City Hall towers over surrounding buildings as the Casco Bay Lines ferry Wabanaki travels out of the harbor, Wednesday morning, June 1, 2022, in Portland, Maine.
Robert F. Bukaty
/
AP
City Hall towers over surrounding buildings as the Casco Bay Lines ferry Wabanaki travels out of the harbor, Wednesday morning, June 1, 2022, in Portland, Maine.

The city of Portland could see an overall tax increase of up to 7% and a drawdown of its rainy day fund to fill a budget gap. But the final tax increase could be lower depending on the results of the city's property revaluation process and other factors.

City manager Danielle West told councilors Monday night that the city is grappling with the rising cost of labor and health insurance, the loss of federal funding and proposals in the state Legislature that could increase general assistance burdens on municipalities.

West's budget proposal calls for using $8.8 million in one-time funding to fill the budget shortfall while capping the overall tax increase at 7%.

"This is not the way that we want to budget," she said, referring to the use of one-time funding. "But we are still waiting for those uncertainties to play out, most relevantly in Augusta."

West said the impact on the average homeowner is hard to quantify because the city will be revaluing property in the upcoming fiscal year.

A spokesperson for the city said the final tax increase could end up being closer to 5.6%, depending on the results of revaluation, legislation in Augusta and potential cost-saving measures at the city level.

At the same time, Mayor Mark Dion told councilors he's concerned about proposals in the legislature that could shift a greater share of general assistance costs onto municipalities, at a time when he said Portland is already shouldering the burden of supporting the state's unhoused population.

"It borders on immoral that they expect us as a community to meet that challenge, yet they deny us the very financial resources that they have promised," he said.

The city council's finance committee will begin reviewing the proposal this week.