OWLS HEAD – Townspeople will gather Tuesday for the annual town meeting to vote on a $639,398 municipal budget and to elect town officers.

Comparing the proposed budget for 2004-05 to last year’s expenses results in a 3.8 percent increase. On the other hand, revenues for the new fiscal year have increased 4 percent, to $660,016, according to annual town reports.

And, the good news is: the amount to be raised by property taxes is down by roughly 1 percent, at $616,920, budget committee Chairwoman Linda Post said Friday.

The town’s share of SAD 5 costs is $2,335,355, up 3.5 percent, and Knox County’s assessment is $248,715, up 1.5 percent.

It’s still unclear what will happen to the tax rate, which is $17.40 per $1,000 of assessed property values, Treasurer Harriet Ferguson said Friday. A recent revaluation has been completed, but the results have not yet been compiled.

The biggest difference in the coming year’s budget is $56,000 for contract services with Rockland for emergency ambulance responses, Post said, which is included in the budget figure.

Also included in the budget is a 5 percent pay raise for town employees, she said.

The largest department budget is for public works, which is seeking $323,770 for operations.

Other departments’ budgets are public safety, $154,159; general government, $153,969; human services, $3,000; debt service, zero; and unclassified, $4,500.

In separate articles, voters will be asked to put aside up to $20,000 for a capital asset fund and to amend the town’s zoning ordinance to change wording regarding commercial riding facilities.

The election of town officers from the floor will include one three-year seat for selectmen, which is now held by Deena Carafelli, and a three-year SAD 5 director’s seat now held by Sally Carleton. Other seats to be filled are three assessors, road commissioner, town council and harbormaster.

The meeting will be at 7 p.m. Tuesday, Sept. 7, at the Community Building.