Town staff projects near 10% municipal increase; council asks for options to reduce tax hit

Old Orchard Beach’s town management presented a preliminary FY27 budget projection Tuesday that staff said would raise the town’s net municipal commitment roughly 9.79% and could push the mill rate from $11.60 to about $12.44 per $1,000 of assessed value under conservative valuation assumptions. Diana, the town manager, said the figure reflects the town operating budget plus the RSU and a sizeable York County assessment increase.

Councilors sought a breakdown of the drivers behind the rise. Diana said the school allocation increased about 5.6% and the county assessment about 16%, both outside the town’s direct control. “When you break those numbers down…our increase is notable, but it is smaller relative to the school and county components,” she said.

Several councilors urged using existing FY26 surpluses and carry-forwards to blunt the tax impact. Diana said staff had identified significant FY26 balances — including capital funds and department surpluses — and could present options to apply more of the town’s unassigned fund balance to lower the mill-rate. “We can provide scenarios for $1.0 million or $1.5 million of additional use of fund balance so council can see the tax impact,” she said.

Council members also discussed program-level choices, such as carrying forward capital work that can be delayed, trimming nonessential park landscaping this year, and reallocating line items in public works to avoid adding to operating spending. One councilor asked staff to calculate how shifting an additional $500,000–$1.5 million from fund balance would translate to per-household tax relief.

The workshop did not include any final votes; staff said they would return with updated numbers, carry-forward proposals and fund-balance scenarios ahead of the council’s formal budget decisions.