Candidate Paul LePage: the Wizard of Waterville?

By Edward Karass, Special to the BDN
Posted July 30, 2010, at 7:01 p.m.

Paul LePage supporters claim that he performed miracles as mayor of Waterville by reducing property taxes and improving the city’s credit rating.

Look behind the curtain. The Waterville miracle is a myth. In fact, when compared with other Maine cities (Bangor, Biddeford, Windham and Brewer), Waterville hasn’t fared very well at all during the reign of Mayor LePage.

Mayor LePage says that he was able to reduce property taxes by “seeking organizational efficiencies, applying sound business principles and advocating for the best interest of taxpayers.”

The facts are, first, that Waterville’s tax rate actually declined less than in other Maine cities during his seven years as mayor, and, second, that Waterville’s tax rate declined only because taxpayers across the state bailed out LePage.

Over the past six years, the property tax mill rate in Waterville declined by 13.46 percent. Other municipalities of similar size fared considerably better. Brewer’s mill rate dropped by about 18 percent, Windham’s by 17.49 percent, Biddeford’s by 15.3 percent and Bangor’s by 13.61 percent.

Why did the mill rate in Waterville decline? Not because of Mayor LePage’s management skills, for the most part, but because the property tax relief initiative from LD 1 increased state payments to Waterville each year and required that those increased payments be used for property tax relief.

During the past five years, Waterville increased expenditures for schools and municipal services by more than $7 million, while the state transferred to the city $17 million more in General Purpose Aid for Education and Municipal Revenue Sharing collected from other Maine taxpayers.

Indeed, without this additional state aid, Mayor LePage’s spending spree could have led to a property tax increase of more than 22 percent each year, starting the year after he took office.

Maine taxpayers funded the Waterville miracle that wasn’t. Did Mayor LePage use our money wisely and well? Ask the 1,800 children enrolled in Waterville public schools. Waterville spent about $371 less per pupil in the 2008–09 school year than the state average, even though Mayor LePage was taking millions more from state coffers.

How are the kids doing in Waterville’s schools? Well, they didn’t meet state standards in 2009 in reading and math for grades 3 and 8. Waterville’s performance was from 6 percent to 24 percent worse than the average student performance across the state. More than 25 percent of Waterville students do not graduate from high school, and according to the most recent SAT results, only about one-third of Waterville’s graduating students are proficient in math and writing, while fewer than half of them are proficient in reading.

While lightening up a bit on property taxes, Mayor LePage has been digging deep in Waterville taxpayers’ other pockets in order to finance a 22.5 percent increase in Waterville’s noneducation operating expenses since he took the helm as mayor. He increased the take from fees and charges for city services from $1.6 million in 2005 to $2.98 million in 2009, an increase of more than 86 percent.

Waterville’s bond rating from Standard & Poor’s has improved slightly during Mayor LePage’s term as mayor, but the bond ratings for all four comparison cities — Bangor, Biddeford, Windham and Brewer — are considerably better.

Why does Standard & Poor’s think that the financial strength of Waterville falls short of these other Maine cities? Maybe because Waterville’s economic growth during Mayor LePage’s reign has been relatively anemic. Since 2004, Waterville’s state valuation has increased by 44 percent, while Bangor’s increased by 40 percent, Brewer’s by 49 percent, Biddeford’s by 56 percent and Windham’s by 69 percent. At the same time, unemployment in Waterville nearly doubled from 4.7 percent to 8.5 percent in just three years, exceeding the state’s average.

Waterville is a wonderful community with a proud heritage, filled with many hard-working people. But for a state whose economy desperately needs to be jump started, the truth about Waterville under Mayor LePage isn’t very encouraging, is it?

Close examination reveals more mediocrity than miracle. While Maine taxpayers have been pumping money into his city, Waterville’s spending for municipal services has increased by 22 percent, and school performance is suffering. The publicly acclaimed Waterville property tax rate turns out to have fallen less than it did in comparable Maine cities that have wrestled with similar economic and financial challenges while the City of Waterville’s economy has underperformed most of those cities, and its bond rating is worse.

Awaiting Maine’s next governor are staggering financial challenges amounting to an anticipated shortfall of more than $1 billion as we approach the next biennial budget, an economy that is struggling and an education system in tatters. Paul LePage’s performance as mayor of Waterville offers no evidence that he is capable of fixing any of it.

Edward Karass is the former state controller and is now the CEO of Karass Financial & Accounting in Gardiner. He supports independent Eliot Cutler for governor.

http://bangordailynews.com/2010/07/30/opinion/candidate-paul-lepage-the-wizard-of-waterville/ printed on December 21, 2014