PEPPERELL -- Selectmen approved placing 23 articles on the annual Town Meeting warrant Monday night, including one for a supplemental town budget that would require a $1.1 million Proposition 2 1/2 override.

The board added the amount needed to increase the budget by 1.5 percent to $476,500 in capital needs, Town Administrator John Moak said. The budget increase would allow the town to maintain level services, while the capital funding would cover estimates from department heads on their immediate capital needs for fiscal 2015.

"It allows us to pass enough of an operating budget that we don't have to come back to the taxpayers for five years, and because of that we do have some excess in the beginning years and that money would be used as a plan to address our shortcomings in buildings, vehicles and equipment," Moak said after the meeting.

The $21.4 million override budget will be presented at Town Meeting May 5, with a balanced budget of $20.79 million, allowing voters to choose which budget to adopt. The lower budget would cut the town's operating budget by 5 percent, leading to reduced hours, some layoffs and no funding for a capital plan.

Without an override, the town would also not be able to address a budget deficit, which would amount to $218,000 in fiscal 2016 and $600,000 by fiscal 2019.

"Even with the cut backs this year, we're still not out of the hole," Moak said.

At a previous meeting, selectmen voted unanimously in support of the override.

Selectmen Chairman Stephen Themelis said Monday the funding for a capital plan would provide for the start of a solution in Pepperell, where routine maintenance and equipment replacement are continually put off due to lack of funding.

"Obviously we need to do something about our problems to fix them and I think this is a great starting point," Themelis said.

If the supplemental budget passes at Town Meeting, a special election will be held June 16.

Selectmen voted to recommend every article except Article 16, which would divert money collected from overdue library-book fines back into the library's budget, rather than allowing the money to go back into the general fund.

Green said other fines collected by town departments go into the general fund, and the library should not be an exception.

Also included on the Town Meeting warrant is an article to adopt the "stretch code," which presents more stringent energy-related building codes than the state standard. Adopting the stretch code is one of five steps necessary for the town to apply for "green communities" status, which opens up doors for grant funding.

The vote to include the stretch code article on the warrant was split, 2-1, with Green the dissenting vote.

Other major warrant articles include a citizen's petition to rezone a section of Hollis Street from residential to commercial and a zoning bylaw to regulate medical-marijuana dispensaries.

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