Old Orchard Beach’s preliminary municipal and school budget for 2027 is $47.9 million, representing about a 10.9% increase over this year’s spending plan.

As proposed, the budget would require a 6.5% tax increase, town officials say.

The combined proposal, about $3.3 million more than this year’s budget, would raise the mill rate by $0.76 per $1,000 of assessed property value, from $11.60 to $12.36.

That means a homeowner with an Old Orchard Beach property valued at the median $490,000 would pay just over $6,000 in annual taxes, an increase of about $370.

Town Manager Diana Asanza said Tuesday night during a budget presentation that the proposal reflects the town’s “continued commitment” to maintaining high-quality municipal services, supporting staff and making responsible investments in the town’s long-term infrastructure and capital needs.

MUNICIPAL BUDGET INCREASE DRIVEN BY WAGES, PROJECTS

The town’s preliminary municipal budget proposal is $31.5 million. It includes $28.5 million for municipal operations, about a 10.7% increase, plus $3 million for capital improvement.

Significant drivers in the increased budget include costs from a wastewater upgrade project, collective bargaining and improved salaries for town staff, and rising health care costs, Asanza said. 

“These investments ensure that we can attract and retain skilled employees needed to deliver reliable services to the community,” she said. 

The town has also made upgrades to roads, sewers, sidewalks, baseball fields and parks, all of which Asanza said are reflected in the proposed budget. 

Another budget driver is the town’s commitment to climate resiliency, Asanza said, including restoring beaches and dunes damaged by storms and conducting a comprehensive marsh assessment in the Ocean Park area. 

“These projects are essential in protecting our shoreline and preparing for future coastal challenges,” Asanza said. 

SALARIES ALSO DRIVING SCHOOL BUDGET PROPOSAL

The proposed RSU 23 school budget, which was presented in March, is $16.4 million — a $871,000, or 5.6%, increase over this year’s. 

The primary drivers for the increases in that budget include salaries and benefits for staff, an anticipated increase in health care premiums and a realignment of special education staffing across the Old Orchard Beach district’s schools.

NEXT STEPS FOR BUDGET CONVERSATIONS

Work on the proposed municipal budget will continue this week as workshops kick off, town staff said. 

After potential revisions during the workshop process, the municipal budget is scheduled to be adopted by the Town Council during its June 2 meeting.

The school budget will head to voters during the June 9 primary election.

Editor’s note: This story was updated on June 17 to correct the amount of the municipal budget proposal.