WESTBROOK – Despite a proposed 2013 Westbrook municipal budget of $23.25 million – a decrease of nearly $46,000 compared to this year – a drop in the city’s property valuation of nearly $20 million may force a tax hike.

And that doesn’t include the school department’s proposed $31.6 million budget, which could push the tax rate even higher.

City Administrator Jerre Bryant, who unveiled the municipal budget Monday for the City Council, said the lower spending plan came in part due to his demand that all department heads produce a budget that was 1.5 percent smaller than the one they submitted for 2012. Bryant also said the city eliminated 3.5 municipal positions.

Some of those positions were unfilled, Bryant said, and one person was moved to another position in the city, but one employee lost his job, the maintenance supervisor at the Fred C. Wescott Building. Technically, Bryant said, Mayor Colleen Hilton could hire him back if the council changes the budget to put the position back on the payroll.

In addition to the position cuts, Hilton said she is recommending cutting back the hours for the city’s chief financial officer. The position, created in 2010, was part of Hilton’s revamping of the city and school district’s finance departments to be overseen by a single person.

“We’ve really done a whole restructure,” Hilton said.

Part of that same restructuring, Hilton said, included the hiring of new accountants to help handle the finance department’s routine business. Bryant said the newly rebuilt department does not require constant supervision by the CFO.

“We don’t need that person to do day-to-day management for the department,” Bryant said this week.

Hilton said the city is still looking to fill the CFO position, and has hired an independent contractor for the position temporarily until the budget is finished.

In his presentation to the council Monday night, Bryant explained the valuation change. In 2007, the state, he said, placed a tax exemption on business equipment put into service after April 1, 2007. For a while, Bryant said, the state, in an attempt to attract business, but not hurt local communities, was reimbursing towns, including Westbrook, for any tax losses due to that exemption.

But the reimbursement has been declining steadily for the past few years, Bryant said, and now it’s beginning to have an impact, notable this year as a $20 million loss in valuation of commercial property in the city.

“Absent that state-imposed loss of tax base, the proposed municipal budget would have reduced the property tax rate in Westbrook by 11 cents,” Bryant told the council Monday. “Unfortunately, this loss of valuation, and the resulting shift of the tax burden from commercial and industrial properties to residential properties, results in a projected 8-cent increase in next year’s municipal property tax rate.”

This means, Bryant said, if the 2013 budget is approved as is, the owner of a $190,000 home would pay a new annual bill of $3,321.20, a $15.20 increase.

The council offered no detailed comment on the budget itself, though Councilor Paul Emery thanked Bryant and the city officials for “working very hard doing an unpleasant job.”

The council voted unanimously to hand the budget off to the Finance Committee, which is expected to review the budget in detail, and possibly make changes, in a series of meetings throughout March. The council is expected to vote on a final version of the budget twice in April, along with the finalized school budget. The public will vote on the final school budget in a referendum in June.

While the proposed $31.6 million school budget is not yet set in stone, whatever it winds up being, School Committee Chairman Ed Symbol and Superintendent Marc Gousse have both said it would likely include many layoffs, and would still require the public to bear a tax increase.

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