AUGUSTA, Maine — A gathering of mayors from five Maine cities to detail their policy priorities morphed into a discussion about how Gov. Paul LePage’s proposal to eliminate municipal revenue sharing denies municipalities’ place in the fabric of Maine tax policy.
Mayors from Sanford, Portland, Augusta, Gardiner and Bangor said huge percentages of the state’s sales and income tax revenues originate in municipalities and that Maine’s 40-year-old law calling for 5 percent of that revenue to be returned to towns and cities should not be repealed, as LePage proposes. They further argued that Maine’s larger communities provide a disproportionate amount of services compared with smaller communities.
“From a service center perspective, we are reliant on state revenue sharing,” said Sanford Mayor Steve Buck. “As municipalities and as service centers, we host the overwhelming majority of services throughout the state.”
LePage, who served as mayor of Waterville before becoming governor in 2011, has argued during his tenure as governor that municipal revenue sharing amounts to “welfare for municipalities,” which he says are not doing enough to cut costs and find efficiencies that save taxpayer dollars.
In his $6.57 billion two-year budget, the governor proposes eliminating municipal revenue sharing in fiscal year 2017 and reallocating the approximately $60 million a year now flowing from the state to local governments for tax relief programs aimed directly at property owners.
Augusta Mayor David Rollins said LePage is skewing the facts about how municipalities use taxpayer dollars.
“Municipalities are the most effective deliverer of services in the state of Maine,” said Rollins. “We work, no matter what you may hear from other officials in the state, diligently to create efficiencies day in and day out.”
In the audience — and not at the podium on Wednesday — was Auburn Mayor Jonathan LaBonte, who directs LePage’s Office of Policy and Management and is one of the governor’s tax reform plan’s chief supporters.
He rebutted Rollins’ statement and said LePage sees more opportunity for efficiencies, including reducing the number of public school administrators and, in some cases, eliminating redundant local and county emergency call centers in, for example, Bangor and his own city of Auburn.
“That’s just early stage inefficiency that there’s a lack of political will to deal with,” said LaBonte after the news conference. “To some extent, revenue sharing is subsidizing that lack of political will.”
Bangor Mayor Nelson Durgin said part of the justification for revenue sharing is that it helps cover unfunded state mandates. He estimated that more than 18 percent of Bangor’s property tax commitment results from unfunded mandates.
“We want to work with the state,” said Durgin. “We just need to make sure it’s not going to be just a cost shift to municipalities.”
LaBonte and the other mayors did have areas of agreement, such as most of the contents of a new Cities of the Future paper released on Wednesday. It calls for investments and improvements in municipally run broadband Internet service, roads and bridges, and the training of a skilled workforce.
The report identifies a range of initiatives and specific bills that are under consideration this year in the Legislature.
LaBonte said his decision not to participate in Wednesday’s news conference doesn’t mean he doesn’t agree with other Maine mayors on many issues.
“There are aspects of the coalition’s document that I disagree with … As I told the other mayors, it’s too important for Maine cities to be working together and staying at the table,” he said. “While I don’t agree with all of it, I wasn’t going to act with a veto power on it. Whether we agree or disagree, it’s important to keep working together.”