CAPE ELIZABETH — The School Board has approved a budget of $23.6 million for the 2016 fiscal year.

The spending plan, approved April 14, is down from the $23.8 million budget proposed in February. The $193,000 decrease is due mostly to a reduction in health-care premiums.

The increase of 1.8 percent from the current year would require a tax increase of seven cents. According to the town website, a home with a value of $314,000 would see a $22 annual property tax increase.

In February, Superintendent of Schools Meredith Nadeau said health-care premiums would be increasing 8 percent. In March, the board said the increase would actually be only 5 percent, but last week it said the cost will decrease 2 percent. This results in a savings of $143,000 from the 5 percent increase.

Board members voted to allocate $50,000 of that for the School Department contingency fund.

Another decline in the budget is due to the cancellation of a plan to implement a preschool program. Nadeau in February said the program would be part of Cape Elizabeth Community Services.

On April 14 Nadeau said the state didn’t make the application for a preschool program available until the previous week, and because of timing the town wasn’t able to apply.

“We don’t have a full-fledged proposal because we didn’t have an application to respond to,” Nadeau told the board. “It’s my expectation that we will be bringing that forward to (the board) next year.”

Nadeau’s February proposal for spending increases for innovation has also been removed and the board will be seeking grant money to fill the gap.

Michael Moore, vice chairman of the board and chairman of it’s finance committee, said he wanted the budget savings to be used to hire more teachers. He said some classes have too many students.

“Based on teacher feedback and based on experience, I think we could reinvest that into staff to address two grades that have class sizes that … are above the recommended size,” he said.

According to the town website, recommended class sizes are 22 students per class for third through twelfth grade, 20 for first and second grade, and 18 for kindergarten.

Other board members disagreed that class size is a problem.

“As our enrollment is declining, our class size is also declining,” John Christie said. “None of our educators have come to us and said, ‘you know, this is necessary.'”

The board decided the contingency fund would cover the cost of addressing the issue if it became a problem.

The budget must still be approved by the Town Council and voters. The council’s finance committee will review the budget April 27 and councilors are expected to approve it on May 11.

The school budget referendum is scheduled for June 9.

Kate Gardner can be reached at 781-3661 ext. 125 or kgardner@theforecaster.net. Follow Kate on Twitter: @katevgardner.