Saco City Council approves $12M school budget and reduces TIF captured value percentage

In the heart of Saco City Hall, the air buzzed with anticipation as council members gathered for the Saco City Council meeting on May 12, 2025. The agenda was packed with crucial decisions that would shape the city’s educational funding and tax policies for the upcoming fiscal year.

The meeting kicked off with a unanimous vote to approve additional local funds for the school budget for fiscal year 2025-2026. Councilor Hewitt presented a resolution to raise $12,680,875, exceeding the state’s essential programs and services allocation. This funding is vital for maintaining educational programs from pre-kindergarten through grade 12, as the current state funding model fails to cover the actual costs of education. The council's approval, with a 7-0 vote, underscores their commitment to supporting local education despite state funding shortfalls.

Next on the agenda was the adult education budget, which received a similar warm reception. Councilor Parks moved to approve a budget of $144,219 for adult education, also passing unanimously. This separate budget highlights the council's recognition of the importance of lifelong learning opportunities for residents.

As the meeting progressed, Councilor Hatch introduced a resolution to set the fiscal year 2026 property tax due dates and interest rates. The council decided on a 7.5% interest rate for delinquent taxes, aligning with state guidelines, while also establishing a 3.5% rate for overpayments. This decision aims to provide clarity and fairness in tax collection, with due dates set for September 9, 2025, and March 10, 2026.

In a move to enhance fiscal responsibility, the council reaffirmed its tax collection policy, ensuring that payments are applied to the oldest outstanding taxes first. This policy, originally approved in 1986, aims to streamline tax collection and reduce confusion for taxpayers.

The council also tackled the complex issue of tax increment financing (TIF). Councilor Hatch proposed a resolution to reduce the captured value percentage of the transit-oriented TIF district, allowing approximately 28% of the revenues to flow back into the city’s general fund. This decision reflects a strategic shift to balance the needs of development with the city’s budgetary requirements. Councilor Berman expressed a desire for further discussion on the overall TIF strategy, indicating a need for clarity on future funding allocations.

Similarly, Councilor Johnston introduced a resolution to reduce the captured value percentage for the downtown development TIF district, returning about 43% of revenues to the general fund. This move aims to alleviate potential tax increases while ensuring that TIF revenues continue to support approved project costs.

As the meeting concluded, the council's decisions highlighted a proactive approach to managing Saco's educational and financial landscape. With unanimous votes on key resolutions, the council demonstrated a united front in addressing the challenges facing the community, ensuring that Saco remains a vibrant place for education and growth. The implications of these decisions will resonate throughout the city as residents prepare for the upcoming fiscal year.