Houlton council torn over waiver of $38,380 payment from Maliseets

Posted Oct. 12, 2011, at 5:53 p.m.

HOULTON, Maine — Despite concerns about conflict of interest and the impact on the municipal budget, town councilors on Tuesday evening authorized the town manager to waive a financial payment that would have been made to the community by the Houlton Band of Maliseet Indians.

After 15 minutes of discussion, the councilors voted 4-2 to authorize Town Manager Doug Hazlett to waive a $38,380 payment instead of taxes from the tribe because they contributed more than $1.2 million in grant money that helped improve a town owned road and funded an environmental project. Councilors John White and Mike Jenkins opposed the move because they believed the town could use the $38,000 in revenue. They also disagreed with legal advice that allowed two other councilors, who are employed by the tribe, to vote on the issue.

The Houlton Band of Maliseet Indians owns tax exempt property in Houlton, which they bought in accordance with the Maine Indian Claims Settlement Act of 1980. That property is held in federal trust for the tribe and as such cannot be taxed, but provisions are made in federal law for the tribe to make payments in lieu of taxes. The tribe has made such payments in the past, as they benefit from municipal services such as road maintenance, education and fire protection.

Hazlett told councilors Tuesday that the tribe can access grant and loan funding that the town cannot, and that a bill put through the Legislature approximately two years ago gave communities the ability to waive in-lieu-of-tax payments if the grant or loan funds were used for the general benefit of taxpayers. In this case, the tribe used a $1.2 million grant to help repair the town owned Currier Road and also secured a $135,000 grant for a project centered on Pearce Brook in Houlton. The Currier Road leads to tribal land.

Hazlett said both the town and the tribe benefited from each project. He also said officials had anticipated the tribe would make the request so they did not include the $38,000 as revenue in this year’s town budget.

Councilor Sue Tortello, who is employed by the tribe, said during the meeting that she and Councilor Brian Donnelly, who also works for the tribe, consulted with the town attorney about voting on the matter and were told they could do so without it being a conflict of interest. In the past, they have refrained from voting on matters related to the tribe.

Tortello said Tuesday evening that she felt the council was justified in granting the waiver, as each project benefited both parties.

“As far as I am concerned, the Currier Road is used by everyone in town, especially the [U.S.] Border Patrol and local farmers,” she said. “ And Pearce Brook is a waterway we all enjoy.”

Tortello also pointed out that a number of Maliseet members do not live on tribal land, so they pay taxes on their own property.

Councilor Nancy Ketch also supported the waiver. She said the town had struggled in the past few years to find money to fix roads that were badly in need of repair.

“The [Currier] road might not have gotten done without that grant money,” she said. “We have been trying to work on the roads and this was a real big help.”

Councilor John Fitzpatrick agreed, calling granting the waiver a “no brainer.”

Donnelly and Chairman Walter Goodrich also supported the move.

Councilors White and Jenkins, however, were against it. Jenkins said he felt that the town was depriving itself of revenue that could be used to offset taxation. He pointed out that the town has had to contribute more money toward the local share of education for SAD 29 and continues to lose money as a result of the high cost of running the Millar Civic Center.

“To be told that $38,000 is a drop in the bucket is insulting,” said Jenkins. He also added that he believed it was a conflict of interest for Tortello and Donnelly to vote on the issue.

“There is a direct monetary gain to be gotten from their employer with their vote,” said Jenkins. He requested that the town garner a second legal opinion on the matter.

White said the town was increasingly dependent on revenue and should not be granting such waivers. He also said that Tortello and Donnelly should abstain from voting.

“If my employer was in a position to gain $38,000 and I didn’t vote for it, I think he would be pretty mad,” said White.

Donnelly countered that there was no monetary gain because the money had not been included in the budget as revenue.

Houlton resident Carl Lord encouraged the council to refuse the request.

“I’ve got to pay taxes and mine are going up,” he said. “I think that these partnerships are some of the best things that have ever happened, but allowing the waiver is wrong.”

Linda Raymond, another Houlton resident and a tribal member, disagreed.

“The tribe put a lot of money into this town road,” she told councilors. “We should get something in return for it.”

Councilors voted 4-2 in favor of allowing Hazlett to waive the payment, with White and Jenkins in opposition. Chairman Goodrich, who only votes to break ties, abstained.

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