The Biddeford City Council on Jan. 21 defeated an ordinance proposal designed to provide property tax and rent relief to income-eligible people 65 and older, citing hefty administrative costs, among other factors. Ed Pierce, Journal Tribune file photo
BIDDEFORD — A property tax and rent rebate initiative under consideration by the Biddeford City Council, aimed at residents 65 and older who also met other criteria, is dead.
Citing high projected administrative costs — about $38,000 for the $100,000 program — plus other issues, like aiming tax relief at one segment of the population while others may also be in poverty, the City Council on Jan. 21 voted 7 to 1 against instituting an ordinance. Councilor Michael Ready was the sole councilor voting in favor and Councilor Amy Clearwater was absent.
“One hurdle is $38,000 plus $100,000 – so management of the fund is 30 percent,” said Councilor Marc Lessard. “The best run ones are 2 to 3 percent.”
There also may be people who qualify for the rebate who might not need the funds, Lessard said. He said he would rather spend the money helping people in the same age bracket with heating costs or with food.
“Though this is done in good faith and to be helpful … for me, a couple of areas are not wrapped as tight as I would like,” Lessard said.
“I agree $38,000 is a lot,” said Councilor Michael Ready. But he pointed out that Biddeford does not use all the money allocated for heating aid, and that the General Assistance Office can help people who qualify with food assistance.
Council President John McCurry wondered if Biddeford might work with Saco, as it does with assessing services, paying the neighboring city to administer the program along with their own.
The program would have made a maximum of $750 in tax or rent rebates available to those 65 and older who earned 90 percent of area median income and had a homestead for a full year prior to the application. Other qualifications include being a Biddeford resident for 10 years, and producing proof of rent paid or property taxes. Proof of income would also be required.
If they had approved the ordinance on Jan. 21, the City Council would have later been asked to appropriate $100,000 in funding for the tax and rent rebate program.
Biddeford Chief Operating Officer Brian Phinney told the City Council that while administration costs in the first year are unknown, based on the number of people who could be eligible for the program — an estimated 2,136 given the information the city has on homesteads and the number of rental properties — the city was recommending the $38,000 figure, to be paid to an outside vendor.
City staff had recommended the General Assistance Office administer the program because they deal regularly in confidential matters but pointed out the office is staffed with one full-time and one part-time worker, Phinney said. If all who were eligible applied, it would take one person 152 days to process the applications, based on 30 minutes for each, but the time window for doing so is 45 days, Phinney estimated in a memo to the City Council. If there was money left from funding the $38,000 administrative cost, it would be returned to the program, he said.
Amounts provided in rebates would vary depending on the number of applicants. As an example, Phinney noted in the memo that if 68.3 percent of eligible applicants applied, and all were eligible for the $750 rebate, the prorated benefit would be limited to $100 if the program were funded at $100,000.
The state passed legislation some years ago that allows municipalities to provide a property tax and rent rebate to people who are 62 and older.
City Council members had been discussing the property tax and rent initiative since June.
It was aimed at lower income seniors, however, Councilor Norman Belanger noted there are people under the age limit that are poor.
“For the amount of money we’re spending, I’d rather reduce the tax rate by $138,000,” Belanger said.
Mayor Alan Casavant said he believed the program is worth developing.
“One problem is the state’s tax code is archaic,” said Casavant, a former state legislator. He said the administrative costs associated with the initiative may be because the city does not have enough staff.
City Manager James Bennett reminded councilors that if they were supportive of the program but wanted a different way to implement it, they could vote to table the ordinance.
“I’m hearing mixed messages,” Bennett said.
There was no vote to table; with all but one of the councilors voting against the proposal.
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