First Selectman Kenneth Flatto unveiled his budget proposal for fiscal year 2011-12 Tuesday, saying it would mean lower tax bills for many Fairfield homeowners despite a 4.2 increase.

In releasing his budget, Flatto also took a swipe at school officials for adding positions and raising administrators' pay.

Flatto put forth a combined town and school budget of $264 million -- a $12.5 million increase over this year's $251.5 million spending plan. His proposal, which goes to the Board of Selectmen and Board of Finance next, cuts more than $1 million from the proposed increase approved last week by the Board of Education.

The school board requested $148.5 million, 4.9 percent more than its current budget. Flatto is recommending $146.9 million, a 3.75 percent increase. The current school budget is $141.5 million.

Flatto took issue with the education spending plan, which adds 19 new positions and gives some administrators 3 percent salary increases.

"To ask for increases for individuals who are making more than the police or fire chief make is unfathomable and unreasonable," he said. "There are a number of highly paid individuals proposed at a 3 percent increase. Their salaries are high already. People making more than these top town officials should tighten their belts and forgo a raise."

He acknowledged that some of those individuals, such as principals, are union members and the raises are contractual.

"They are at the high end in the state and making more than every town department head," Flatto said. "It's not right and it's not fair."

According to the school board budget, salaries for pincipals and headmasters range from $136,219 to $165,568. The director of operations, Thomas Cullen, for example, will get a salary increase from $152,166 to $155,209.

Flatto also said the school district hired seven or eight people last year after the budget was adopted. "These are new positions," he said, adding that the district took a risk adding those positions after a budget was adopted. "If you hire beyond what you projected, that is new staffing."

A small portion of the "new" positions -- 2.2 fulltime employees -- were funded by one-time grants, according to Flatto, who pointed out that the school board agreed when those grants were received that there was no guarantee those jobs would continue in the future.

On the town side, Flatto said the majority of the spending increase is tied to costs for employee benefits, such as health insurance and retiree benefits, increased funding for the paving program and anticipated salary increases once contracts are settled with all the town's bargaining units.

After having a salary freeze this past year, Flatto said, "We anticipate some cost-of-living increase" though he said it would be "modest."

The town's operating budget -- not including debt service, and retiree benefits -- is proposed at $81,214,273. Non-education spending is now $77,836,357 and Flatto's proposal reflects at 4.34 percent increase.

If the budget is adopted as proposed, it would result in a tax rate of 22.36 mills. The current mill rate is 19.27, but would be 21.45 when adjusted for the recently completed property revaluation.

That revaluation will help about 60 percent of the town's homeowners, Flatto said, who will see some reduction in their tax bills. The majority of commercial and industrial property owners will see a tax increase, he said.

For example, a home previously assessed at $560,000 and newly revalued at $481,600, would see a slight decrease in the tax bill from $10,791 to $10,769. The tax bill for a home assessed before revaluation at $700,00 and now assessed at $560,000 would drop from $13,489 to $12,522.

On a home where the assessment fell from $420,000 to $336,000, the tax bill would fall from 8,093 to $7,513.

The change in the tax bill, Flatto said, depends on how much market value a property retained.

For example, a home now assessed at $515,200 that had been assessed at $560,000 retained 92 percent of its market value. That home's tax bill would increase from $10,791 to $11,520.

"Any home assessed at less than 87 percent of their home's prior 2010 assessment will experience a tax reduction dependent upon how low our new assessment fell," Flatto said

He said more than 60 percent of the taxpayers will see a slight or significant property tax reduction. "In other words, most homeowners' new re-assessed values more than offset the 4 percent proposed budget mill rate change."