A Portland lawmaker wants to charge the growing number of gas-guzzling, tax-evading megayachts docking in Maine during the summer a premium slip fee, some of which would be used to help the state’s working waterfront and islands prepare for climate change.

“There are few things that demonstrate the unsustainable levels of inequality that exist in society today more than the megayachts that billionaires bring to coastal Maine every year,” Rep. Grayson Lookner, D-Portland, said during a legislative hearing Tuesday.

“In one summer these vessels can emit as much carbon as hundreds of American families do annually, contributing to the accelerating climate crisis,” he said. “The Gulf of Maine is one of the fastest warming bodies of water on the planet so this should be a cause of concern to all of us.”

Opponents told lawmakers that such a tax wouldn’t hurt the wealthy owners, who would merely dock their yachts in another New England state. Instead, it would hurt the Maine shoreside businesses that supply and repair the vessels and feed and entertain those aboard.

“It’s easy to say tax the million and billionaires, but these yacht owners will pursue other options outside of Maine and the people that will suffer the consequences are the citizens that you have sworn to protect,” said Laura East, dockmaster of Strouts Point Wharf in South Freeport.

The bill, L.D. 1177, would allow a municipality to collect a $10-a-day slip fee for every foot that a non-fishing vessel registered abroad extends beyond the 100-foot megayacht threshold. The municipality would keep 10%; the rest would be spent on waterfront and public transit projects.

Originally, Lookner’s bill would have split what remains of the slip fee revenues after the municipal cut between state public transportation projects and low-income and homeless housing. On Tuesday, however, Lookner decided to fund working waterfront projects instead.

“Ferries for island transportation, dredging to keep our harbors accessible, public moorings and docks,” Lookner said. “In the near future, there will be an unprecedented need to invest in sea-level rise infrastructure to keep our historic communities and preserve our working waterfronts.”

During his testimony, Lookner called the slip fee a modest one that would not scare away visitors who have the kind of money to spend their summers aboard megayachts. He likened the slip fee to Maine’s lodging tax, which has not scared away tourists of far more modest means.

He accused the couple dozen megayacht owners who summer in Maine of registering their vessels in offshore tax havens, like the Cayman Islands, Panama and Lichtenstein, a landlocked country, to hide their wealth from American authorities and to avoid paying U.S. taxes.

It was clear the issue of megayachts has struck a class chord among some in Maine.

“While residents of Portland deal with lack of affordable housing, homelessness, and housing immigrants and other new Americans, we have a waterfront view blocked by luxury yachts, owned by transnational corporations, avoiding accountability,” said Tony Donovan of Portland.

But several of the marinas that serve this exclusive clientele disputed this claim, saying that many of the megayachts fly a foreign flag because it allows them more flexibility in hiring crew in a tight labor force, more corporate privacy, and more flexibility to charter such a large vessel out.

Luciano DiMillo, marina manager at DiMillo’s Marina in Portland, said most of the megayachts that dock at his facility are registered in Florida, which established a reasonable sales tax cap several years ago that has made the megayacht tax dodge a thing of the past.

“A tax on berthing such as this will do nothing but hurt the local marine-related industries,” DiMillo said. “These yachts provide jobs to many U.S. citizens, young and old, and provide economic impact in every port they visit. They spend thousands of dollars.”

For some shoreside businesses, the arrival of the megayachts had made all the difference.

In 2020, when the pandemic hit, Harmon’s Floral Company in Portland was facing the grim prospect of laying off its entire wedding floral team, owner Dan Kennedy said. During a typical summer season, the company’s payroll can swell to as many as 30 people.

But the uptick in megayacht tie-ups in Casco Bay that summer meant that Kennedy didn’t have to lay anyone off. Instead of decorating shoreside ballrooms, his seasonal wedding team turned its attention to luxurious dining rooms, staterooms and captain’s quarters.

“It was a godsend for us,” Kennedy said. “On some days, the phone wouldn’t ring at all, not a single customer, then a yacht would call and we’d have $10,000 worth of business in a day. They kept us going when we needed it most. That’s something you don’t forget.”

Kennedy noted that florists are just one of the many shoreside businesses to profit from the arrival of the big yachts. Grocers, specialty food purveyors, ship supply companies, fueling companies, salons, restaurants and art galleries are just a few others that benefit, he said.

“We’re fortunate that they’re coming all the way up to Maine because it’s not always the best weather,” Kennedy said. “They could go anywhere. Europe. The West Indies. I think that taxing these vessels is like saying ‘Please, don’t come here, we don’t want your money.’ ”

 

 

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