PHILLIPS - The town will be shut down, for the most part, at least until Saturday, July 12, when voters will revisit a proposed budget for fiscal 2009.

All town employees were laid off as of Monday after voters rejected exceeding the $256,076 tax levy limit for municipal operations on Saturday and didn't take action on any articles to allow spending town money.

The budget funds were needed for the fiscal year that began July 1.

The July 12 special town meeting will be held at 9 a.m. at the old gymnasium at the Community Building on Depot Street, Town Manager Lynn White said Tuesday.

The proposed budget is $1.7 million, which includes about $692,537 for the town's share of the SAD 58 budget. The latter was approved by voters at the polls on June 10. Only cosmetic changes will be made to the warrant articles, White said, and there will be a better explanation of the need to exceed the tax levy limit.

Until then, arrangements have been made with Avon to handle registration of Phillips residents' vehicles and boats during regular business hours, and to hold the excise taxes for Phillips, White said.

Though White is laid-off, he continues to volunteer his time as do some other employees.

In all, Phillips has about 30 full- and part-time employees including on-call firefighters.

White said he has posted updates, and will continue to do so, around the town in public buildings, stores, businesses and other entities to keep people informed of what's going on.

The town manager has been seeking advice from the Maine Municipal Association. He said the town's workers compensation and liability insurances are intact, and if firefighters are needed to respond to an emergency call, they could, even though they don't anticipate getting paid.

"I told firefighters 'I couldn't give them direction but as a volunteer group they might want to respond to an emergency,'" White said.

The town's transfer station will resume regular hours Wednesday morning.

"We are moving forward to fill gaping holes of safety and health issues to make sure we're covered, if we can cover it, and make it stay within the boundaries of the law," White said.

Ambulance service will continue to be available, White said.

When Livermore Falls voters shut down that town in June 2006 by rejecting expenditure articles at town meeting, firefighters and police signed a letter of agreement acknowledging that it was possible they wouldn't be compensated for their time.

To avoid the possibility of a shutdown in the future, town officials now put forth budgets under the town's growth cap limit and have an active Budget Committee, and make sure plenty of information gets out to people prior to vote.

That town also went to a budget referendum where voters make their decisions on budgets by secret ballot.