May 23, 2018
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Our yearly tourism tsunami

Robert F. Bukaty | BDN
Robert F. Bukaty | BDN
In this May 26, 2011 photo, a message on a storefront window says "We speak French" and welcomes French-Canadians to Old Orchard Beach, Maine.

If you are anywhere near Maine’s splendid tourist spots, you soon will wait longer in traffic, see gas prices rise and find lengthy lines at the local grocery store. Perhaps it will make you yearn for the sleet of November. Have patience, smile, think of the time you visited New York City and asked for directions to Wrigley Field.

Tourism in Maine has benefits for handymen, fishermen, carpenters, waitresses and housekeeping staff, among many others. Readers may not have heard of a musical produced a few years ago by summer residents of North Haven that tells the story:

Summer people, summer people, busy, busy summer people. Sailing, swimming, biking, golfing, having parties all the time.

Island people, island people, busy, busy island people. Cooking, cleaning, mowing, running, making summer people fine.”

Still, there are costs. The summer influx means that Maine must spend more in maintaining roads and bridges and law enforcement, to name a few elements of the downside of tourism.

The summer people are generally getting off easy in paying for these costs, according to a 2006 report by Matthew Murray, a professor of economics at the University of Tennessee, published by the Brookings Institution.

He wrote that the Maine tourism industry was estimated as supporting 176,633 jobs, produced nearly $4 billion in wage and salary income and yielded $531 million in 2004. Beneficiary sectors, in order, were retail trade, restaurants, transportation, recreation and accommodations. He also wrote that spending by Maine residents accounted for about 30 percent of these benefits.

Murray reported that Maine’s lodging tax of 7 percent is slightly lower than the regional average of 8.12 percent, while the 7 percent tax on restaurant food is a little above the regional average of 6.12 percent.

Maine’s motor vehicle rental rate ranks among the highest in the nation. Maine does not tax on admissions or entertainment services such as movies and ski resorts, while people pay an average tax of 6.14 percent in other states in the region.

Tourism-related jobs are often seasonal, offer low pay and are lacking in benefits like health insurance, Murray wrote. He put the average wage in Maine’s leisure and hospitality sector at $14,138, against a $31,393 average for Maine’s private-sector jobs.

“Snowbirds” pose a special problem for economists who would like to tax the some-odd 100,000 residents who escape Maine’s income tax by spending more than half a year away, many times in Florida.

The Democratic-controlled Legislature in 2010 passed a tax-reform package that would have offset a gradual income tax reduction by raising the sales tax from 7 to 8.5 percent and extending its impact to meals and lodging and certain exempt services. (The Brookings Institution urged a 3-point increase). A people’s veto defeated the measure by a nearly 2-to-1 vote in June of that year.

Gov. Paul LePage and the current Republican-controlled Legislature have tried a less inflammatory method of trying to lure more people into year-round residency. Reduction in pension and estate taxation may persuade more retirees to settle in Maine.

However these matters are managed, Maine will continue to share its beauties and pleasures with the summer folk. Spread the word and keep smiling.

Have feedback? Want to know more? Send us ideas for follow-up stories.

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