By JOSEPH B. NADEAU

NORTH SMITHFIELD — The town has a new tax rate after town officials completed work on a total budget of $33,982,005 for 2008-2009 this week.

The tax rate on residential property will rise 98 cents to $13.24 per 1000 assessed value as a result of the Council’s unanimous budget vote Monday, an 8.9 percent increase, and the tax rate for commercial property will rise by 8.8 percent to 16.72 per 1,000 assessed value, according to Town Administrator Robert B. Lowe and Councilman David Lovett.
The budget provides a total of $20,595,086 for schools under a compromise worked out with the school department allowing school officials to restore most of the programs and staffing positions threatened during the budget process.
The budget funds the new middle school on Providence Pike with the help of an override of the state’s cap on property tax revenues but only on the bond payment for the project covering principal and interest, Lowe said.
The council and school department worked out a plan to cover another $496,000 requested for schools by using $224,000 in surplus school funding, the town’s $147,000 Northern Rhode Island Collaborative settlement award, and $122,000 in town surplus funding.
“We added more money to the school budget to get the middle school open and operating but at no additional cost to the taxpayer,” Lovett said.
The new budget will raise taxes on an average $300,000 local home by approximately $324 a year, but that increase covers both the school opening and the town’s increased operating costs, Lowe said.
“If we didn’t have the new middle school cost we actually would have had a slight decrease in taxes,” Lowe said of the budget work put into meet the town’s revenue limits.
By contrast, the budget process had begun four months ago with officials expecting to raise taxes on that same $300,000 home by $358 just to cover construction of the new school, Lowe said.
“We were able to do that because the School Department stayed within their budget and we received more town income than we anticipated,” Lowe said.
The agreement will allow the school department to bring back musical instructors at the elementary and middle school level, the middle school athletics program and also restore an all-day kindergarten program at the elementary level, according to Lowe.
While other communities have had to cut staff to meet budget, Lowe said the town’s attention to budget details actually allowed the Police Department to plan for the hiring of two new patrol officers this fall. That will allow the department to post a weekend shift officer to help curb overtime costs and a daytime officer who will help handle traffic issues and court prosecutions.
Lowe had wanted the town to also consider the option of a converting the town’s part-time Town Solicitor post to a full-time position but lost that bid when the council instead opted to increase the extraordinary legal fees account by $10,000.
While limited by the lack of an increase in state assistance this year, Lowe said the town’s Finance Department found a way to improve local revenues to assist town’s budget balancing work.
Finance Director Jill Gemma and Tax Assessor Christine Belair tightened the local projection on tax revenues by improving collections and finding some local properties that had not been on the tax rolls, Lowe said.
The reassessment of tangible property generated another $220,000 in revenue the town had not been receiving, Lowe said, and the close scrutiny of taxable property another $50,000 to $60,000, Lowe said.
In one instance, the town found that a power plant operation that had been sold off from the old Tupperware Plant at the North Smithfield-Blackstone townline years ago had never been added to the tax rolls.
The town is now assessing the property at a rate in keeping with a power generating business, Lowe said.
That work and the cooperation between other town departments helped the town get through the most difficult budget year he has seen in his years of public service, Lowe said.
“Everybody worked all together at the end,” Lowe said. “We even go the school department to say that they understand what the taxpayer is paying in this town. They took what they knew was the most that the taxpayers could afford,” he said.
The town does have a tax increase this year, but Lowe said he is still happy that it was not larger.
“I give my staff a tremendous amount of credit. They knew what we had to do and they accomplished it,” he said.