Lincoln County legislators say they are listening to the concerns of local officials and will work against the governor’s proposal to gut municipal revenue sources.
Sen. Chris Johnson, D-Somerville; Rep. Mick Devin, D-Newcastle; and Rep. Bruce MacDonald, D-Boothbay, attended a Feb. 15 forum about Republican Gov. Paul LePage’s biennial budget proposal at Skidompha Public Library.
The biennial budget would cut $142.99 million in state revenue to towns, according to an analysis by the Maine Municipal Association.
For example, Damariscotta, the host of the Feb. 15 event, would lose $213,933.
Those figures do not account for LePage’s proposal to cut education funding and shift costs for teacher retirement to towns, which many towns could find equally challenging.
Damariscotta officials and town officials throughout the state worry they will have to either cut basic services, like education, public safety and public works; or raise property taxes to make up the difference.
The Democratic lawmakers at the Feb. 15 event, however, belong to the majority in both houses of the legislature and say they will oppose the LePage budget and work with their colleagues to develop an alternative.
“We can’t cut revenue sharing that way,” MacDonald said, in reference to the program that is the target for the bulk of the cuts. “It has a terribly adverse impact on local budgets, obviously, and schools in particular, which is my biggest area of concern.”
“For me, that’s a non-starter too,” Johnson said. “We can’t do that to our towns and to our property taxpayers.”
“The shifting of costs onto the property tax represents a completely wrong direction to go in tax policy,” MacDonald said. “The property tax is the most regressive of the three main taxes we have available to us.”
The property tax, unlike the income and sales taxes, affects low- and middle-income residents, including senior citizens on fixed incomes, at least as much as it affects wealthy residents, MacDonald said.
“For most low- and middle-income people the property – the home, maybe the small business – represents their biggest investment in wealth. It is their wealth,” he said.
“At the same time, as a state and as a nation, we’re lowering the burden on people who have a greater ability to pay,” he said. “This is completely unfair to me. It can’t go on.”
Devin said he has started meeting with the boards of selectmen of the towns he represents to gather their thoughts and concerns to the legislature’s appropriations committee.
“You people are going to tell me what you want to do as far as revenue sharing,” he said.
Devin said he wants to finish his circuit of the towns in District 51 before he decides how to proceed. “Certainly, as it stands right now, completely gutting revenue sharing is a non-starter for me,” he said.
The audience of more than 40 people included selectmen, budget committee members and school board representatives from Bremen, Bristol, Damariscotta, Newcastle, Waldoboro, Whitefield and elsewhere.
The organizers of the event invited those officials to speak about their concerns at the beginning of the two-hour forum.
“I think that there is fat in the state budget that should be cut before they start pushing it down on the property taxpayers,” Newcastle Selectman Pat Hudson said.
“We have many people in Newcastle who are just making it and to have to go up more on the mil rate would be very, very discouraging and we do not want to have to do that,” Hudson said.
The mil rate determines the amount of property tax per $1000 of town-assessed value. For example, the owner of a property with a town-assessed value of $100,000 would pay a property tax of $1490 under Newcastle’s current mil rate of $14.90.
Newcastle stands to lose $150,784 if the LePage budget passes, not including the shift in teacher retirement costs.
The legislators also fielded questions about how they intend to balance the state budget without shifting costs to towns.
Johnson said he did not think the state should have cut income taxes in 2011, a cut LePage bills as the biggest in state history.
“I don’t think it was responsible,” Johnson said.
“If we vote for this budget as it is, we’re all voting for a property tax increase,” he said.
Johnson, Devin and MacDonald said they would consider an increase in the lodging and meals tax, while Johnson said he would consider changes to the income tax structure.
About 75-80 percent of the revenue from the lodging and meals tax comes from visitors to the state, Devin said.
“I would like to see us utilize the assets that we have so that they benefit the state of Maine a little bit more,” Devin said.
The state liquor contract is among the assets the legislature needs to examine, he said. “Can we manage our liquor sales a little bit better so that the state benefits?” he said.
He said he also wants to learn about how other states, like Alaska and Florida, generate revenue from the tourism industry.
The legislators also asked the audience for ideas about how to cut state costs or raise revenue.
Newcastle resident Lorraine Anderson said the legislature should eliminate the $300,000 budget of the Maine Charter School Commission.
“I think charter schools are really not the panacea that everybody thinks they are,” she said. “If that $300,000 went to the public school system it might be better spent.”
“I can assure you that all three of us up here are forcing the legislature to look at charter schools, virtual schools, their value, their cost,” Devin said. Devin has already submitted a bill to establish a moratorium on charter schools.
“I oppose any further amount of money going to charter schools whatsoever,” MacDonald said. MacDonald has drafted legislation to prohibit for-profit virtual schools.
The audience also asked about the legislative process and how the legislature plans to develop a budget that could withstand a LePage veto.
“I would expect that we would find much fairer ways in balancing the budget in reporting out a biennial budget,” Johnson said. “If the governor chooses to veto that, we have to understand that is a possibility.”
“I think we have to go for a budget that is inclusive enough to get a two-thirds vote and that means that nobody is going to get everything they want,” MacDonald said.
Waldoboro Board of Selectmen Vice Chairman James Bodman said the prospect of any compromise with the governor on revenue sharing still scares him.
Waldoboro would take the biggest hit of any Lincoln County town as it stands to lose $470,874, not including education cuts.
Johnson and MacDonald said they do not plan to compromise on revenue sharing.
“I think there’s a recognition by both parties just how hard this is going to be for towns if it’s left in there,” Johnson said.
“They think that the cities and towns are going to make cuts because the ideology of Governor LePage and the people around him is that all government is too big, that we need to cut, cut, cut,” MacDonald said.
“I think they’re wrong,” he said. “I think there are all kinds of essential services that towns and cities provide.”
“We’re at the point where there is no more cutting,” MacDonald said. “That’s what I think.”