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Palesky Tax Cut Initiative
Guiding Principles for Draft Municipal Budget Assuming Passage

Introduction

A statewide vote in favor of the Palesky tax cap initiative will require major reductions in local government spending. Cape Elizabeth municipal spending is already at the lowest level per capita among comparable area communities. The full value tax rate for municipal services is also the lowest within the peer group. Consequently, there is no excess to remove from the municipal budget. Reductions will necessarily directly impact services and additional revenues from sources other than the property tax will be felt by those paying the fees.

In determining an implementation strategy for the budgetary changes that will be mandated, the following guiding principles are being utilized at this stage of planning for the Cape Elizabeth municipal budget:

General Guiding Principles

Open Deliberative Process.

The program, service area and fee adjustments shall be guided and debated through an open deliberative process and will take final form in the proposed Fiscal Year 2006 Municipal Budget which shall be reviewed and approved in accordance with provisions of the Council-Manager Charter of the Town of Cape Elizabeth.

Determination of Governmental Services.

The municipal budget shall focus upon maintaining services which cannot be provided except through government. In any instance when a service can also be provided by the private sector, the service provided through the town must break even or make a profit on an operating basis. The town shall also seek to recover all indirect and non-operating costs although it is recognized that this is impossible in some instances.

Any New Fees to Be Demand Driven

In adjusting any fees or in instituting new fees, the fees shall be established on a use or demand level basis. New fees should be avoided for services used by all citizens where the service demand level is the same for all citizens.

Realistic Estimates

All proposed adjustments shall be clearly achievable. Optimistic projections of future revenues or expenditure savings must be avoided. Estimates need to be reality based.

Competitive Compensation and Benefits

In order to recruit and retain competent staff, employees who remain shall receive salaries, wages and benefits that are comparable with other areas communities and are comparable to those provided by the ten largest employers (public and private) in Greater Portland.

Specific Guiding Principles

Debt Obligation

The highest priority for the municipal budget is to fulfill our debt service obligations, as when the borrowing occurred, we pledged the full faith and credit of the Town and the failure to meet obligations will dramatically increase costs for future borrowing.

Public Safety

The next highest priority is public safety. Public safety includes prompt response by police, fire and rescue personnel to households and parcels throughout the town. It includes roads that are reasonably clear after a snowstorm and roads that are treated during icy conditions. It includes ensuring that personnel are trained to respond, have the safety equipment that they need and other equipment available to complete their tasks.

Insurance and Liability Protection

The town shall maintain adequate insurances and shall continue actions that minimize the liability of the town.

Revenue Collection and Good Business Practices

A priority is to ensure that personnel and practices are in place to collect the revenues that support programs and services and to ensure that all funds are properly accounted for. There may be fewer hours to transact business in person, but use of on-line transactions should be expanded where legally possible and when cost effective. The town shall also retain surpluses consistent with recommended amounts from financial rating agencies.

Reduction of Volunteer Support

Volunteers have traditionally provided many services for the Town. The volunteers and call-personnel need to be supported, but some administrative and professional assistance to them will no longer be afforded.

Cost Sharing and Regionalization

When cooperative arrangements can be made with neighboring communities and/or with the Cape Elizabeth School Department that will save costs and will not result in a diminution of service solely due to the cooperative arrangements, the cooperative arrangements should be implemented. Library programs should be a special focus of cooperative arrangements due to the close proximity of library facilities.

Maintenance of Assets

The town's assets should be maintained especially buildings

Self Supporting Activities

The Community Services Program, the recycling center, the fitness center and all parks should be fully funded through user fees including all operating, capital and overhead costs. Some parks and the school grounds will need more volunteer help in their maintenance. The community swimming pool should be closed if it cannot recover its operating costs. Fees would be prohibitively expensive in order to recover the debt service costs. Building permit fees and other fees related to development should be raised to a level that will cover all related costs and impacts. All other fees for service should be reviewed.