The Saco City Council unanimously approved the city’s $44 million combined municipal budget Monday night.

The final budget represents a roughly $4 million, or 10.1% increase, over this year’s nearly $40 million budget, including operating costs, debt service and capital outlay.

The municipal budget’s impact on the mill rate is estimated to be the same as this year’s, $14.20 per $1,000 of valuation, city spokesperson Andrew Dickinson said Tuesday.

But Dickinson said the city won’t have a final rate until July, once the county and school budgets are finalized. Those are likely to cause a property tax increase.

Updated property valuations could also cause Saco property owners’ taxes to rise. In a presentation to the council in March, City Administrator Ryan Pelletier said the median cost of a single-family home in Saco is estimated at $486,000 for 2027, up from $422,400 in 2026.

That means that the owner of a home priced at the median would pay $6,901 in taxes annually at the current rate.

City staff have cited salaries, cost-of-living adjustments and new positions as the primary drivers for the budget increase.

The budget passed with only two amendments, both proposed by Councilor Nathan Johnston and passed by 7-0 votes.

The first amendment will allocate $300,000 from the city’s unassigned fund balance for future affordable housing projects across Saco.

“It’s key that we have some funding to bring to the table,” Councilor William Gayle said. “I think this is a great use of our funds.”

The second amendment will transfer $200,000 from the unassigned fund balance to support future human-powered projects, such as those centered on biking or walking.

“This is something we have discussed for three or four years,” Johnston said. “I think while we have the funding, it behooves us to continue to put money aside.”

At Monday’s meeting, Johnston said the municipal budget is the “single most important” policy decision made by the council and noted that approving a budget is “no small task.”

“I’ve watched this budget grow over the last decade,” he said. “It really should weigh heavily on the council how to spend these funds.”

Voters will decide on Saco’s proposed school budget on June 9.

The school budget proposal for next year currently sits near $60 million, which Superintendent Jeremy Ray said in March would require a tax hike of about 10%.

The approved school budget for this year sat at $57.2 million.

Editor’s note: This story was updated on May 12 to correct information about the total budget amount.