WATERVILLE — City councilors on Tuesday are scheduled to take a first vote on a proposed $37.9 million municipal and school budget for 2008-09.

The meeting will be held at 7 p.m. in the council chambers at The Center downtown and will be preceded by a private session at 6:30 p.m. to discuss labor contracts and negotiations.

City Manager Michael Roy proposes to decrease the tax rate from $24.90 per $1,000 of valuation to $24.40.

Councilors must take three votes on the budget; Roy said he expects a second vote will be taken May 20 and a third and final vote, June 3. The public would then vote on the proposal at a June 10 referendum.