CONTRIBUTORS

Maine Legislature must keep its promise to pay revenue sharing back to towns, cities

Posted Feb. 09, 2014, at 11:53 a.m.
BDN

More than 40 years ago, Maine government made a promise to every town and city in every corner of our state.

The promise: The state would return a portion of the sales and income taxes collected from the towns, back to those towns and cities. That promise is called revenue sharing. Its purpose is to provide property tax relief to homeowners and other commercial property owners.

As a former Bangor city councilor, I can tell you that this funding is a critical part of our municipal budgets. We use it to fix our roads, pay for our police and fire departments, educate our children, care for our parks and pay for many other public services that make Bangor the unique and wonderful city we call home.

In recent years, we have wisely used some of this funding to invest in economic growth. We have attracted new businesses and transformed our downtown into a thriving economic center once again.

For four decades, the state kept its promise of revenue sharing, its partnership with all of Maine’s local governments.

Last year Gov. Paul LePage broke this promise. In his budget plan, he proposed to do away with revenue sharing. His plan did not reduce taxes; instead it shifted the tax burden to property owners in Maine’s towns and cities. It was radical, reckless and wrong.

In response, mayors, city managers, select boards and fire and police chiefs from across our state have come to Augusta, stood in protest and spoken with outrage about the proposed cuts to the core of their communities. The Legislature responded. Democrats led the way and restored much of the revenue sharing that LePage planned to cut.

But even this is not enough. Local budgets continue to be stretched. Homeowners and business owners can’t afford another hike in their property taxes. Knowing this, the chairwomen of the state’s Appropriations Committee, Sen. Dawn Hill and Rep. Peggy Rotundo, proposed a measure that would restore revenue sharing to our towns.

As tight as local budgets are now, if revenue sharing isn’t restored, Bangor will lose an additional $1.4 million dollars. Hermon would lose over $100,000.

Instead of agreeing to help solve this problem, LePage last month doubled down on his threat to completely eliminate revenue sharing. He even went so far as to call it “welfare.” This label is inaccurate. It’s important to remember that the money the governor calls “welfare” is actually money that is collected from our towns, from people like you and me. It is sales and income tax dollars that we pay to the state.

The governor seems to have forgotten that the state collects over $1 billion a year in sales taxes from our communities — and Bangor generates more money in sales tax revenue than anywhere else in the state!

The Maine House of Representatives took an initial vote on the measure and passed it overwhelmingly with bipartisan support. Democratic and Republican legislators know that if we don’t act to restore this funding, Bangor and Hermon, along with every other community in the state, will be forced to raise property taxes and make painful cuts to already strained budgets. This is unacceptable. The state, through revenue sharing, should pay it back to the towns as it always has in the past.

Solving this challenge is a priority. Soon, the House will take up the measure again, and then the Senate. I am working with my colleagues to make sure we keep our promise to fund revenue sharing. If we work together, we can find a way for the state to renew its partnership with Bangor, Hermon and every community across the state.

I think we all agree: It is time for the state of Maine to live up to its commitment.

Sen. Geoffrey Gratwick, D-Bangor, is a practicing physician.

 

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