The Havre de Grace City Council voted unanimously to adopt the final version of the fiscal 2026 budget, which will increase police salaries and raise water rates.

Mayor William Martin described the budget as “tight” and “lean” when he introduced it to the council in April, mainly due to inflation. .

The budget is divided into three parts: the General Fund, Water and Sewer and the Marine Fund. The General Fund will start the fiscal year with a $1.55 million balance; revenue is estimated at $20 million. The property tax rate will remain the same, generating about $430,000 in additional revenue that will go toward a 5% increase in uniformed police officer salaries.

Martin said during the council meeting Monday night that city police officers are “extremely underpaid” with a starting salary of about $52,000 a year. The salary increase, the mayor added, will show the city is invested in its public safety officials. In total, sworn police officer compensation will increase by 10%.

“We believe Havre de Grace is a safe city,” Martin said. “We must invest in that.”

Overall, the budget estimates about $23.3 million in spending, with $21.6 million designated for operating expenses. This will be a $1.6 million increase from the current fiscal year due to personnel costs and inflation.

“Every single tax dollar that’s spent … is sacred,” the mayor added.

The sewer rate will not be touched; however, the water rate will increase 50 cents. The additional revenue will go into a new capital reserve fund. The budget estimates $345,000 in water revenue.

The General Fund also includes the city’s arts and entertainment sector. Residents have expressed concerns over the amount of revenue the STAR Centre is taking in and its expenses. Over time, Martin said he would like to see the STAR Centre become self-sustaining, adding that the venue is working toward that goal.

“It’s an investment, and if it becomes an albatross, we’ll have to reevaluate it,” he said during Monday’s meeting. “But I will give it five years of a good, honest go at it. …”

The Havre de Grace fiscal 2026 budget goes into effect on July 1.

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