Cape Elizabeth resident Jim Walsh credits hard economic times with giving him the push he needed to get off the sidelines of town government and try to get into the game.

He says he decided the time was right for him to run for the Cape Elizabeth Town Council as the town faces a budget deficit and needs to make decisions on two potentially expensive projects.

“I’ve lived here for 21 years and I’ve been on the sidelines with our town government,” he said. “With the financial condition of our country, and with the regional and local challenges that face us … I felt I would offer up my experience to pick up Mary Ann Lynch’s seat for the next two years.”

Walsh is running against Penny Jordan for the seat Lynch vacated shortly before the Nov. 4 elections. Lynch, who had been chairwoman of the council, was prohibited from holding elected office after she took a job as director of information for the state judiciary. She had been on the Town Council for seven years.

Walsh owns Weichert Realtors-Waterglen Group in Portland and is co-owner of Freaky Bean Coffee. He holds a bachelor of arts degree in education from the University of Massachusetts and two master’s degrees, one in education administration and supervision and an MBA from Suffolk University. He grew up in the Boston area and has been married to his wife, Kathy, for 36 years. They have four children, all of whom graduated from Cape Elizabeth High School.

He said he feels the next two years will be pivotal for Cape’s municipal government. An “all hands on deck” approach will be needed, he said, if Cape is going to continue moving in the right direction.

“You have to look at it a couple of ways,” he said. “First you have a state government that has curtailed $421,000 for this year’s allotment to the school department. Combine that with a drop in excise tax and an increase in spending for municipal contracts, (and) one can see that we could have a problem if we don’t deal with it wisely.”

Walsh is encouraging Cape leaders to “think out of the box” about a budget for which revenues are projected do be down about $500,000 in the next year.

One idea that he pitched to Town Manager Michael McGovern was to license all commercial photos taken of the Portland Head Light House.

“Places like Williamsburg, Pa., that license anything to do with the town, make millions of dollars in licensing fees,” Walsh said. “It’s just an idea, but we should be doing something like that for ourselves.”

He also recommends charging a fee to enter Fort Williams.

“Those are just two examples,” he said. “We need to look at what we are facing for funding issues and look at what we’ve got for resources and interests that could generate revenue.”

Walsh said, if elected, he knows he’d have to make difficult decisions on several pending projects.

Cape will be discussing putting in a stop light on Route 77, a project it tabled last fall because it was unsure of its upcoming economic situation. Another project includes extending the pedestrian path along Shore Road. Both projects are estimated to cost between $1.2 and $1.5 million.

“From our current economic environment, one would have to take all of that into consideration and weigh out what the priorities should be,” he said.

The special election will be Jan. 27 from 7 a.m to 8 p.m. in Room 102 at Cape Elizabeth High School.