Bill Bridgeo served as Augusta city manager from 1998 to 2021. For the past four years he has been the state representative for District 60 (the east side of Augusta).

Like most Augusta property owners, my wife and I were notified last week of the new assessed value the city has established for our home. Although I knew a revaluation process was underway and that prices in my neighborhood had soared in recent years, the new valuation (more than double the old one) was a shock.

With four decades as a city manager in two cities in Maine and one in New York, I had no trouble estimating what the impact of this adjustment was going to mean to the family budget (and it wasn’t good). Having spent the past four years as the state representative for the east side of the city, constantly meeting and getting to know constituents throughout the district, I know that property taxes were already a huge concern before the reval results came out. Now that concern has grown exponentially and people are understandably upset.

A natural reaction to the shock of a drastic upward change in folks’ property value assessments — and the feared large increase in upcoming tax bills — is to blame the city’s elected officials and appointed administrators. To be fair, though, these men and women no more want this than the rest of us do and they have very little ability to mitigate the impacts beyond slashing basic services.

One major cause of what we and other Maine municipalities are experiencing is the state government’s misguided policies. There are three factors causing Maine state government’s negative impact on local property taxes. I will explain them below, then describe what I plan to do about it.

Enter adverse factor number one: our state’s constitutional requirement that all property in Maine be assessed at its “just value” or fair market value. The courts have determined that when a measurable disparity develops between what a municipality is carrying for valuation on its assessment rolls and what properties are actually selling for, that disparity must be corrected (a revaluation).

State law lays out when and how that must take place. Once the city’s average assessed values dropped below 80% of average market value, the need to reassess began to emerge. Within just a few years that difference expanded to a point where assessed values were only reflecting 43% of fair market value and the city had no choice but to reassess. 

Complicating things further — factor number two — the market value of commercial and industrial properties has not appreciated correspondingly, meaning that when the process was concluded Augusta’s residential properties ended up shouldering a much larger percentage of the overall tax burden.

The third factor causing our perfect storm is that since statehood in 1820 Maine has relied far too heavily on the property tax to pay for its most basic and important government services (schools, police and fire, public works, etc.) I taught state and local government courses for many years as a UMA adjunct professor before I retired in 2021 and I know that other states around the country put far more reliance on more fair and broad-based taxes (primarily income and sales taxes) to raise necessary revenues.

New York, for example, directly shares a significant percentage of all sales tax revenues generated in a city with that city. In the city I managed for a decade in upstate New York, 25% of the city budget’s revenues came from the local share of sales tax. Until Maine finds a way to wean itself off its overreliance on property taxes, we are going to struggle.

So, what can be done? Well, as a state representative I can — and will before the next legislative session even begins — introduce a bill (or bills) that does the following:

• Proposes a constitutional amendment that allows for primary residences to be taxed at a differential rate than other classifications (second homes; rental properties; commercial and industrial properties).
• Immediately raises the amount of exempt value provided by the Homestead Exemption from $25,000 to $50,000 and increases the percentage the state reimburses  municipalities for the lost property tax revenue that would result.
• Boosts the Property Tax Fairness Credit amount to qualified taxpayers.
• Addresses the burden that cities like Augusta that host expansive federal, state, county and not-for-profit properties through some form of payment in lieu of taxes compensation for the municipal services they require.

Small consolation though it may be, Augusta is not alone in dealing with this problem. Cities and towns all over Maine have been grappling with it. For that reason, I think the time is ripe for comprehensive legislation to hit this problem head-on. I’m sure I will have no trouble finding co-sponsors on both side of the aisle to get it done.

I also value your thoughts on possible legislative solutions. Please feel free to reach out to me and share them.