SACO — Residents in Saco approved a nearly $40.5 million fiscal year 2020 school budget in a 389 to 204 vote on Tuesday.

The $40.5 million school budget on Tuesday’s ballot was one that had been approved by the Saco City Council on March 13 and was nearly $1.4 million less than the budget proposal handed to the council by the school board.

The reduction was voted in by the council due to a $290,000 over-projection of insurance costs and anticipated surplus.

Saco residents will see an estimated increase to the local property tax rate of 11 cents, putting the local mil rate at $19.49. An 11 cent mil rate increase equates to a $22 annual property tax increase on a $200,000 home.

Broken down, county taxes will raise the mil rate by one cent, while the municipal budget will raise the mil rate by 68 cents. These increases are offset by the school budget, which decreases the mil rate by 58 cents.

Residents also voted 423 to 173 to continue the budget referendum process for the next three years.

This will continue the three-step procedure in Saco to pass the school budget. The school board first approves a budget proposal, which is sent to the City Council for approval. The school budget approved by the City Council is then sent to a city-wide referendum, through which the residents make the final decision.

— Staff Writer Liz Gotthelf can be reached at 780-9015 or by email at egotthelf@journaltribune.com.