Old Orchard Beach draws from undesignated fund to lessen property tax increase

With some help from the undesignated fund balance, the Old Orchard Beach Town Council approved a fiscal year 2027 budget that will keep the mil rate under $12.

On Tuesday, the Town Council approved a nearly $28.6 million municipal operating budget, covering expenses need to provide essential services to the community, and a $2.7 million municipal capital improve improvement budget, covering major investments in the town’s infrastructure and equipment. County taxes for fiscal year 2027 are nearly $1.5 million.

The municipal operating and capital improvement budget, combined with the county taxes and the previously approved school budget, will increase the mil rate 3.3 percent, from $11.60 to $11.98 per thousand.

Council Chairman Shawn O’Neill said at Tuesday night’s Town Council meeting that it was a difficult budget year, noting that county taxes increased 16 percent.

“I think this is a fair opportunity for us to give taxpayers as much relieve as we can provide them,” said O’Neill.

The Town Council voted to use $500,000 from the ambulance fees billing funds, and $1.5 million from the undesignated fund balance. After the $1.5 million draw, the undesignated fund balance will have $13.7 million. It is recommended that a municipality have enough in its undesignated fund balance to cover three months worth of expenses, and with $13.7 million in the fund the town will still be in good standing with auditors, said Town Manager Diana Asanza.

Saco Bay News Publisher Liz Gotthelf can be reached at newsdesk@sacobaynews.com.