Maine’s legislators are getting really good at making laws

and breaking them.

Lawmakers have perennially dodged one particular state statute, the infamous LD 1, which came about through a citizen-initiated referendum and mandated the state to fund 55 percent of the cost of education. Our legislators have failed to come anywhere close to their promised target in the 10 years since. As a result, whatever Augusta fails to fund of the education pie is passed on to local taxpayers. Thus, taxes have rocketed as school budgets soar.

The LD 1 story seems to be a lost battle, and no one much cares that our representatives are breaking state law. But given an inch, now they’re taking a mile. Lawmakers are violating a similar law requiring the state to kick back 5 percent of income and sales tax revenue to municipalities. State revenue sharing, as it’s called, has been in existence for years and has helped to diversify the tax base required to keep towns operating without relying too heavily on property taxpayers.

Last year, Gov. Paul LePage began chipping away at revenue sharing, which just a few years prior yielded about $200 million for municipalities. Now, it’s down to $60 million. LePage initially proposed to suspend revenue sharing altogether last year, but Democrats beat back that proposal. The win might be short-lived, since lawmakers this year are considering to pull it back by another $40.

The problem with cutting revenue sharing is that it puts undue pressure on the local property taxpayer, both residential and commercial. Yes, someone has to pay for government, and it’s lawmakers’ prerogative to figure out how the pain is doled out. But the state needs to do that as fairly as possible, and sending some of what it collects in income and sales tax

is a good way to spread the burden. Income and sales taxes

are considered more progressive than the property tax because they are based on the ability to pay. It makes sense that the less money one earns and the less one buys, the less tax one pays.

Relying on local property owners is a regressive way to raise revenue since the cost of one’s house doesn’t necessarily mesh with one’s ability to pay, especially if a homeowner has lost his or her job and is struggling to make ends meet. Those on fixed or falling incomes may not be able to withstand a higher property tax bill.

Lawmakers are breaking their own law here in Maine. Some say the legislators and LePage are trying to pass off their budget troubles to the municipalities. Others say some in Augusta are playing a political game, trying to cause a tax revolt on the local level as the pain hits closer to home. Either way, there are real-world impacts that the lawmakers in Augusta seem not too concerned about. As we learned in 2008, the home is really the focal point of the American economy, especially here in suburban and rural Maine. Adopting policies that make owning a home more difficult will hurt the economy in the short and long run. Our lawmakers need to remember that as they fiddle with the tax structure.

This is an election year, and voters, most of whom own a house or rent from a property taxpayer who will likely pass on those tax hikes, should take note of how their local legislator votes regarding revenue sharing. Not only are they breaking the law when they subsidize local governments less than 55 percent for education and less than 5 percent for revenue sharing, they also are making lives difficult for those of us who rely on our homes as an investment and point of pride.

We still have high hopes for our leaders in Augusta, but just in case, local budget makers would be wise to plan for even less state revenue as they start considering next year’s budget.

–John Balentine, managing editor


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