SACO — Residents will have the final say on Tuesday for a nearly $40.5 million school budget.

Last month, the Saco City Council approved a $28.8 million municipal budget and proposed a nearly $40.5 million school budget.

The combined municipal and proposed school budgets will raise the current mil rate by an estimated 11 cents to $19.49. An 11 cent mil rate increase would equate 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.

The proposed school budget approved by the City Council is significantly less — nearly $1.4 million – than the school budget the school board presented to the council.

Part of the reduction — $290,0000 — was due to insurance costs being lower than projected.

The rest of the reduction — $1.1 million — was proposed by Councilor Nathan Johnston, who said the school department had a surplus due to over-budgeting money to Thornton Academy, remaining special education funding and $150,000 in unused contingency funds.

School Finance Director Jason DiDonato said the school department anticipated a $1.5 million surplus at the end of the year, however there was no surplus currently on the books.

“It’s frowned upon by the auditors to budget a surplus for the following budget year that hasn’t been realized yet,” said DiDonato at last month’s meeting.

While the city had helped the school department pay off its debt from money owed to Thornton Academy and from costs associated with leaving Regional School Unit 23, the school department still had a negative fund balance of $460,000, DiDonato said.

He said he would be hesitant to budget the full amount of the anticipated surplus and not be able to guarantee funding for programs.

Though last month’s vote was the last say on the municipal budget, the school budget needs final approval at city-wide vote on June 11. Voting at the June ballot will take place from 7 a.m. to 8 p.m. at the Community Center located at 75 Franklin St.

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