AUBURN — The proposed $129 million budget for next year was presented to the City Council on Monday, and officials say there are tough choices ahead before the final budget is approved this spring.

The starting point for budget deliberations for the fiscal year 2025-26 budget is a nearly 6% increase for the combined municipal and school budgets.

Mayor Jeff Harmon said Tuesday Auburn is facing the same challenges as many municipalities across Maine, with costs continuing to increase, combined with the goal of limiting property tax increases.

“The City Council will be faced with making difficult choices given the increasing cost of providing services and maintaining infrastructure balanced against the desire to limit property tax increases,” he said.

In his budget presentation Monday, City Manager Phil Crowell said officials are “cognizant of the current economic and financial conditions impacting our citizens,” while the city continues to face challenges in “recruitment and retention of qualified employees, and inflationary pressures driving the costs of products and services required in all areas of our municipal operations.”

The proposed municipal budget of $64.3 million would be a 7.8% increase from this year. Crowell said the largest increases come from contractual obligations, debt service for recent bonding, and shared costs between Lewiston and Auburn for operating the airport and Citylink bus service.

According to Crowell’s budget overview, the cost of debt payments will increase $2.87 million heading into next year, a 22% increase from this year. The increase stems from items like infrastructure improvements included in the Capital Improvement Plan, but also larger projects like the Merrow Road reconstruction and the New Auburn Fire Station. Another $5.8 million was bonded toward costs for the new Public Safety facility.

The debt service increase accounts for 62% of the proposed budget increase next year.

Crowell told councilors Monday that the budget directive was to “keep current programs, with no increase in staff.”

Auburn residents have become increasingly vocal over the last few years regarding rising property taxes, as higher real estate values have led to reassessments. The city is currently conducting a revaluation that officials hope can equalize the tax burden, but taxpayers are bracing for more tax increases.

Crowell gave the council a list of other programs and projects that could be considered for next year, which includes a proposed senior property tax assistance program that the council forwarded earlier this year. At the time, the program was estimated to cost between $300,000-$400,000, providing up to $600 in assistance per qualifying household.

The budget preview does not include an estimated property tax increase based on the proposed numbers. The fiscal 2024-25 budget, which runs until June 30, 2025, added $1.36 to the property tax rate.

Crowell also told the council that it would likely need to have a “big conversation about debt,” regarding its current obligations and what it should anticipate for the new Public Safety building.

The city announced last week that Mayor Harmon will host two town hall-style discussions on Auburn’s fiscal 2025-26 budget, where residents can “learn about budget highlights (and) drivers,” ask questions and share feedback.

The sessions will be from 6 to 7 p.m. March 27 in the Community Room at Auburn Hall, and from 2 to 3:30 p.m. March 29 in the conference room at the Auburn Public Library.