NORTH KINGSTOWN — Police Chief Edward Charboneau is eyeing several budget scenarios for his department next year. One of them calls for 17 layoffs: 12 officers, 2 dispatchers, a records clerk, an animal control officer and a part-time harbormaster.

That budget, 20 percent lower than this year’s, would save taxpayers in this affluent suburb more than a half-million dollars.

But it would also make it impossible to effectively patrol the 44-square-mile community, Charboneau said. “It would degrade our ability to provide for the safety of our citizens.”

It’s a worst-case scenario, and town officials probably won’t endorse it. But it does underscore the grim financial future officials here and elsewhere are facing.

Facing little or no non-schools state aid next year, and dwindling revenues from other sources, towns and cities are scrambling to find ways to operate.

“Everything is on the table,” said Town Manager Michael Embury. “If you can’t make cuts in areas like public safety, then the money has to come from somewhere else.”

Anticipating a tough year ahead, Embury in September asked department heads to submit two budgets –– one featuring a 20 percent cut in operations — for the fiscal year that begins next July 1.

Now, he’s compiling three municipal budget proposals required by the Town Council.

The proposals represent a slight increase in spending, no increase, and a 2 percent cut in this year’s budget.

The scenarios can be misleading, Embury said. A proposal that includes no increase is actually a budget reduction. That’s because some items –– salaries and utility costs among them –– increase each year.

The Town Council members have until May to approve a budget for the next fiscal year.

Whatever they do, it won’t be easy.

In all, the town could lose $1.8 million in revenue and state aid, Embury said.

This year, the town received $709,000 in revenue sharing from the state. Next year, the town will probably get nothing, he said.

Meanwhile, the worsening economy is taking a toll on local revenues.

Because fewer people are eating out, food and drink taxes are down. The result? The town could lose $65,000, according to Embury.

Also, when people lose jobs or income, and get deeper into debt, they put aside their tax bills. Even a 1 percent drop in tax revenue would mean a loss of more than $625,000, Embury said.

Like individual investors, the town has also lost money in the stock market. “Our investment earnings have dropped dramatically,” he said. “They’re 50 percent less than what we expected.” That translates into a $400,000 loss, he said.

School officials, meanwhile, are focusing on a $58-million budget draft for the next fiscal year that represents a 2 percent increase in expenses. It anticipates a reduction in state aid but an increase in local tax support, said Ned Draper, director of administrative services.

A 2 percent cut would make it hard for the district to operate next year, he said. Even a budget that includes no spending increase “would still be pretty devastating.”

The faltering economy and budget cuts will mean fewer jobs at Town Hall and in the school district.

“We won’t fill vacant positions,” Embury said. “After that, we’ll move on to possible layoffs. I don’t think it’s resonated with taxpayers yet, but it’s going to mean some pretty drastic changes in how we operate.”

pdavis@projo.com