Orono city council approved their 2021 preliminary budget and preliminary tax levy during their Sept. 28 meeting.

City staff has been working on the 2021 General Fund budget since May, including four council work sessions, where input and direction was given to staff by the city council.

The preliminary budget included a total expenditure amount of $9,260,500, which is an increase of 1.3 percent from the 2020 budget. The increase is the result of a 2.9 percent increase in wages and benefits.

When compared to the 2020 tax levy, the 2021 levy is increasing by $603,170, or 10.04 percent. The levy for the General Fund would increase by 5.18 percent and $185,000 to be added to the building fund. Council also directed the levied $125,000 to be directed to the building fund.

The Pavement Management fund would see an increase of 21.47 percent, $50,000 sent to the Parks Fund, a .085 percent increase to the GO Improvement Bond 2014 and 0.05 percent decrease to the GO Improvement Bond 2016. The levy budget total is $6,610,620.

Fifty-three percent of the city’s General Fund budget revenue is supported by taxes, and 28 percent is supported by public safety services. The average property tax distribution for the City of Orono includes 37 percent to the Orono School District, 40 percent to the county, 9 percent to other and 15 percent towards the city.

Homeowners would see a 1.87 percent increase from 2020. For homeowners with a home valued at $250,000, they would see a $7.27 increase. For homeowners with a home valued at $500,000, they would see a $15.45 increase and for homeowners with a home valued at $1,000,000, they would see a $34.76 increase.

“The tax capacity is basically at where we were in 2017. It still would be a significant decrease from 2014 … and keeping the rate flat for four years is something to be proud of,” Finance Director Ron Olson said to the council.

From 2014 to 2020, there has been a 7.31 percent property tax rate decrease according to Olson.

According to Orono Mayor Denny Walsh, the city has paid off approximately $7 million in debt since 2014, has taken the Pavement Management Fund from zero to $750,000, are putting $50,000 into the Parks budget and are starting their building fund.

The final budget and levy is set to be approved during the Dec. 7, 2020 meeting. Public input is allowed prior to the final adoption.

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