Lewiston proposes $33.58 tax rate and 20% sewer, stormwater hikes; council to weigh cuts and frozen positions

Brian O'Malley, Lewiston city administrator, and Tracy Roy, finance director, presented a proposed fiscal-year 2025 budget at a March workshop that would raise the combined city, school and county tax rate by $1.81 — from $31.77 to $33.58, a 5.68% increase from last year. O'Malley said the projection assumes the school and proposed municipal budgets are approved as presented and that the county increase is already set.

O'Malley said municipal expenditures are projected to rise 5.5%, an increase of about $3.3 million. To limit pressure on the tax rate, staff cut approximately $9.6 million from department requests and plan to move about $6.9 million to fund balance. The administrator said he asked department heads not to request new positions and recommended freezing several positions pending final budget approval, including two police officer positions and multiple public-works roles: two Class C highway workers, one Class B highway worker, one mechanic and two temporary mechanics.

Roy said the proposed budget uses 95% of the state revenue-sharing allocation as a conservative assumption and reported the city's unassigned fund balance at about 10.01% in the current forecast and 14.01% at the end of the prior fiscal year. She said staff transferred $200,000 from fund balance into the workers'comp reserve during FY24 and that closing two large workers'comp cases contributed to a reduction in the unfunded liability to roughly $3.4 million.

The draft includes utility rate changes for enterprise funds. O'Malley said water rates are not proposed to increase; sewer and stormwater rates are presented as a 20% increase, down from an initial 31% proposal. The administration said those increases would take effect July 1 if approved and that the sewer/stormwater projections included the new rates. Councilors were specifically told that the water utility (if it needed a rate increase) would require approval from the Public Utilities Committee.

O'Malley identified specific service and capital changes: paving requests were reduced by about $2 million from original department asks; certain salary costs financed from a clean-energy TIF and grant monies were preserved; and parking-garage revenue declined about $191,000, which staff attributed in part to lost downtown workers and tenants at Bates Mill.

Councilors pressed staff on borrowing policy and medium-term capacity. During the meeting Ron Smith said the city should compare its local policy to the state statute on debt limitations and watch for low-interest federal infrastructure funding that could make borrowing advantageous. Councilor Steve Colley and others argued the council's conservative borrowing policy (previously set to limit borrowing to 80% of retired debt over a three-year average) can make it difficult to finance capital needs as debt is retired.

O'Malley said bond sales follow a schedule to allow spend-down; staff sold 2023 bonds last September and plan to sell 2024 and 2025 issues in coming Septembers. He and Roy said councilors can revisit frozen positions if vacancies are later filled or if fund-balance availability prompts a supplemental appropriation.

Ending: City staff said the proposed budget and audit will be posted online for public review; department-level hearings and follow-up budget sessions are scheduled in the coming weeks where the council will examine personnel, capital and enterprise-fund details before making final decisions.