t’s likely that South Portland residents will see an increase in their property taxes for the new fiscal year, which begins on July 1, based on the budget guidance the City Council gave at a workshop last week.

During a meeting with the Board of Education held on Jan. 14, councilors indicated they might be willing to support a combined increase of between 3 and 5 percent for the upcoming municipal and school budgets.

However, Mayor Linda Cohen also said she’s concerned about the impact on people’s wallets, arguing that “people are maxed out in a lot of ways and I’m not comfortable with a 5 percent increase. There is a breaking point.”

In all, Cohen urged both municipal department heads and the school department not to ask for new positions and to base the new 2015-2016 fiscal year budget on current spending – simply maintaining the programs and services already offered.

Both City Manager Jim Gailey and Superintendent Suzanne Godin pointed out, though, that just maintaining the level of service now available would still come with some increases, based on salary and benefit increases and increases in fixed costs, such as electricity.

Godin also said that although “it’s a total shot in the dark (right now),” the school department is anticipating a loss in revenue of about $814,000 based on reductions in both state and federal funding.

She said the loss of that funding would have a tax impact of about 7 percent and any cuts the school department would have to make to meet the City Council spending target would have the most impact on programs and personnel.

Gailey said most of the reductions in revenue the city would see under the governor’s proposed state budget would come in the second year of the biennium, or fiscal year 2016-2017. Even so he’s concerned about the impact on local taxes.

And, he said, the city is already anticipating a loss in revenue of $95,000 for the upcoming fiscal year, which combined with increases in costs could lead to a 3.8 percent bump in taxes only for municipal services, not including the cost of running the schools.

While most of the city councilors said they would consider a tax increase of between 3 and 5 percent, Councilor Tom Blake said he might be willing to go as high as 6 percent, but he also wanted to know how other communities are dealing with the impact of the proposed state budget.

“I’d like to know what others are doing, maybe somebody out there will have a unique idea,” Blake said.

Overall, Councilor Patti Smith seemed to speak for the majority of councilors when she said her biggest concern was how best to position the city within the two-year state budget.

“I’d rather be as consistent as possible and not have big swings,” she said. “I feel we are growing in the right direction in so many, many ways and I want to have two years of as strong funding as possible.”

Smith was told that a combined increase in spending of 5 percent would amount to a tax increase of 85 cents per $1,000 of valuation. This year’s tax rate in South Portland is $17.10 per $1,000.

Godin said her plan is to have the school department budget ready for adoption by the school board no later than March 30, but that would also depend on when the school department hears from the state about what level of funding it can expect for the new fiscal year.

A new combined budget must be passed by the City Council no later than June 30 and the proposed school department budget must also go through the added step of being approved though a local referendum.