The 2015-2016 Cape Elizabeth municipal budget is expected to increase $585,000 compared with this year’s budget of $9.2 million, or 6.3 percent.

Town Manager Michael McGovern gave a brief presentation of his proposed $9.8 million budget at the March 9 council meeting, saying that under the current proposal, the town’s tax rate of $16.80 per $1,000 valuation will increase by 1.6 percent overall, including school, county and community services as well as local impact due to anticipated changes in the state’s tax policies. Cape homeowners with a property valued at $300,000 would see an $81 increase under the new rate.

About half of the budget increase is attributed to a renovation and expansion project under way at the Thomas Memorial Library, which includes $1.26 million in interest, McGovern said.

McGovern said he anticipates that the project debt will be paid completely by March 15, 2035. The debt service costs for the $4 million library bond is $290,000 and the actual costs are $306,904, said McGovern. Without the library project, the town’s 2015-2016 budget, not including school services, would rise 2.8 percent, or 10 cents, he said.

“The true interest cost of the library is about 2.4 percent,” said McGovern.

Personnel costs account for 51 percent of the proposed budget, said McGovern, and most employees are expected to receive a 2.5 percent raise. Due to changing demographics, health insurance costs have increased by about $40,000; worker’s compensation insurance is up 31 percent, or $30,000. In addition, the budget includes $35,000 to share the cost of a human resources assistant with the school department.

Other increases include $15,000 in additional retirement costs; $10,000 for facilities maintenance and $10,000 for legal services, in part to defend the town against a lawsuit filed by Verizon Wireless after the town denied the company a permit application to build a facility on a decommissioned Avon Road water tower.

“Every time you respond to (lawsuits), you incur costs,” McGovern said.

Due to the impact of the library project, capital funding will only increase $50,000 this year despite the town’s capital stewardship plan, which calls for increasing funding for capital needs by $100,000 every year.

“The budget provides for $950,000, or $50,000 more than last year,” McGovern said.

The increase in funding will pay for several projects including roadway paving and drainage needs, replacing two police cruisers, replacement of a town pickup truck, and repairing the high school tennis court.

Rescue fees increased

After a brief presentation by Fire Chief Peter Gleeson, councilors on Monday voted unanimously to increase the town’s rescue fees, effective March 30.

According to Gleeson, the town’s rescue fees have not increased for at least five years. At the meeting he recommended a proposal by Shawn McPherson, from Medical Reimbursement, a company that handles rescue billing for Cape Elizabeth, to switch to a flat-rate billing system.

The proposed rate change means the cost of a basic life support emergency transport will increase from $400 to $600, and a flat $900 will be charged for all advanced life support transports. Previously, depending on the level of service required, advance life support transports cost $500-$600. In addition, the new method of billing would increase mileage charges from 10 cents to 14 cents.

“Currently, we bill for transport, mileage and for the services provided during the transport,” Gleeson wrote in a memo to McGovern in February. “Several of the services (Medical Reimbursement) bills for have gone to a flat rate billing system for each transport. The flat rate billing system would result in a less complicated billing method … under our current billing method we would have to review each call to see what services we provided.”

Under the new fee schedule, Gleeson is projecting a revenue increase of $468,000. The rescue unit’s recommended budget is $340,177 – an increase of 24 percent over this year’s budget – which will enable the unit to break even at a 75-percent collection rate, said Gleeson. In Cape Elizabeth, where most residents are privately insured, a 75-percent collection rate is “pretty good” compared to some other communities in Maine, he added.

The department is also looking to increase the number of daytime hours for per diem coverage as part of the 2016 budget. The department now relies on six people to respond to about 50 percent of rescue calls, he told the council.

“If we lose a couple of them, we could have some coverage issues. We would just like to increase that coverage to make sure we do have that (advanced life support) service provider on for 16 hours a day,” Gleeson said.