Revenue sharing is a promise Maine’s Legislature must keep

By John Schneck and Archie Verow, Special to the BDN
Posted Jan. 26, 2014, at 8:55 a.m.

Mainers from all over our state recently packed a State House committee room. Their message was loud and clear: protect revenue sharing and local property taxpayers.

More than 40 years ago, the state entered into a promise with Maine towns and cities. In recognition of the services communities provide in support of Maine’s economy, Bangor, Brewer, our neighboring communities and all other municipalities in Maine get a portion of income and sales tax collected by the state.

The practice is called revenue sharing. It helps our communities provide services like emergency services, schools and road maintenance while keeping local property taxes in check. It helps to attract businesses that rely on municipal services. It helps the middle class — young families getting their start, working Mainers with tight household budgets and the elderly and others on fixed incomes who want to stay in their homes.

Communities have been getting a shrinking amount of revenue sharing funds. In these times of diminished revenue sharing, it could get even worse. In the latest threat to revenue sharing, our communities of Bangor and Brewer stand to lose another $1.4 million and $366,000, respectively. It would make an already difficult situation that much worse.

Last legislative session, the governor even proposed the complete elimination of revenue sharing, which would have dealt a devastating blow to towns and cities across the state and shifted costs to local communities and their property taxpayers. The Legislature crafted and passed a bipartisan budget that restored two-thirds of revenue sharing and blunted the property tax hikes in the governor’s budget.

Right now, the state needs to keep in place $40 million in revenue sharing to meet the promise made in the bipartisan budget. A bill from Rep. Peggy Rotundo of Lewiston and Sen. Dawn Hill of York, the chairs of the budget-writing committee, would restore this funding to local communities. The measure would look at possibilities like scaling back corporate tax breaks to large-scale retailers like Wal-Mart, removing accounting tricks that allow out-of-state-firms to avoid paying some taxes and using some money from the state’s “Rainy Day” fund and a GOP-initiated account reserved for additional tax breaks for the wealthy.

Without this measure, communities in Maine are in danger of losing more than 60 percent of revenue sharing funds planned for next year. This includes $10.8 million to lower property taxes for commercial property owners and $29.2 million for residential property owners. Communities would see losses of $26 million in school funding, $12 million for local town operations and $2 million for county tax needs.

What should our local officials do? Cut teachers from our children’s classrooms? Eliminate police and fire positions until these departments are stretched dangerously thin? Stop plowing, salting and sanding our roads? Leave our cemeteries untended? Close the libraries?

We heard from communities that they don’t have fat to trim from their budgets. Where else is there to go? The property taxpayers who shouldn’t have to — and in some cases, just plain can’t — shoulder any more of the burden? Middle-class Mainers are already working hard in a time of stagnating wages and deserve better than this.

These scenarios are particularly galling for our area, given Bangor-Brewer’s economic role in Maine. We know, for example, from Bangor officials that the city generates $1.2 billion in annual retail sales. That’s the highest in the state — higher than Augusta, Portland or South Portland. Our community is a commercial and cultural hub, one that draws commerce and visitors and whose transportation, public works and public safety infrastructure are heavily used to the overall benefit of the state.

Lawmakers on both sides of the aisle understand the importance of revenue sharing — and how important it is for the state to honor its promises to Maine’s communities. Hundreds of Mainers came to the State House to remind us of their importance. They came from all over the state to let us know that they and their friends and neighbors cannot afford a property tax hike. Let’s make sure they know we heard them.

Rep. John Schneck, D-Bangor, is a first-term lawmaker and former small-business owner. Rep. Archie Verow, D-Brewer, is a first-term lawmaker and a former Brewer mayor, City Council member and city clerk.

 

http://bangordailynews.com/2014/01/26/opinion/revenue-sharing-is-a-promise-maines-legislature-must-keep/ printed on April 16, 2014