Ever get so fed up with your taxes that you want to burn your tax bills and started a revolt? You may just get your chance.
A new grassroots organization called the Citizens Alliance of Maine are planning to stir up the debate on property tax reform by holding the Second Great American Tea Party, named after the historic Boston Tea Party of 1773.
The Second Great American Tea Party will be a series of regional demonstrations throughout Maine to protest rising property taxes and educate taxpayers about property tax reform initiatives, namely the Taxpayers Bill of Rights (TABOR). Though details of the Lakes Region demonstration have not been finalized, a date of September 24 has been set statewide for the Second Great American Tea Party, says local tax reform advocate Lane Hiltunen.
Hiltunen held the first meeting of the Sebago Lakes chapter of the alliance on July 7. The purpose of that meeting was to share ideas about proerty tax reform. Hiltunen will be scheduling another meeting for late July as the Citizens Alliance drafts the details of the Second Great American Tea Party.
“We want to bring out the issues of Maine tax burden,” said Jack Wibby, head of the Citizens Alliance of Maine. “Maine has nothing. Maine has an imaginary spending cap that’s so easy to go around it’s almost meaningless. That’s why we want the TABOR and why we want it as a constitutional amendment.”
The TABOR initiative would not only limit spending at all levels of government to inflation and population growth, but set in place a mandate that would return 80 percent of budget surplus to the taxpayer, says Wibby. Budget surplus, appropriated money carried over from year to year, is typically put into municipal fund balances or a budget stabilization fund at the state level. This money is used in case of emergencies such as a natural disaster or economic recession. With the imposed LD1 spending cap, some towns, like Windham, have used this money to cover budget shortfalls.
The state of Colorado adopted a taxpayers bill of rights similar to TABOR to their constitution in 1992. It returned $3.25 billion to the taxpayers from 1997-2001, according to Dr. Richard K Vedder, Professor of Economics at Ohio University in Athens, Ohio. This has both decreased the tax burden and stimulated the Colorado economy, says Mary Adams, head of the TABOR initiative here in Maine
“Colorado’s been a great state for TABOR,” says Adams. “And it’s taught other states how to refine it and make it even better.”
In December of 1977, Adams fought and won her first battle for property tax reform when she and others brought the former state property tax to referendum where it was defeated. She now is the lead volunteer of the TABOR petition drive. Adams uses the metaphor of a jockey riding a horse to describe the effect the TABOR initiative would have on government spending in Maine.
“It puts the bit in the mouth of government and gives the reins to the people of Maine,” Adams said.
The “bit” is a limit on spending and the “reins” are the stipulations laid out in the proposed TABOR amendment, says Adams. In order for the government to spend more than the limit set by inflation and population growth, the people of Maine would have to approve the additional spending by a two-thirds majority if TABOR were to be put in effect.
“We’re not the only ones who are having problems,” Adams said. “Our function in Maine right now is to serve as a bad example. We’re number one in the nation for state-local tax burden. In other words we don’t have the income to spend the money we are. We’re a poor family living in a big house.”
The LD1 tax cap, which went into effect this year, aimed to control spending in a different way than TABOR. LD1 limits the amount of money that can be levied through property taxes by a municipality. According to Martha Freeman, director of the State Planning Office, LD1 limits municipal spending and increases the state’s share of education costs for grades K-12 to 55 percent. This results in a $212 million decrease in local obligation, says Freedman. However, LD1 does not mandate a tax return, but instead let’s local municipalities and schools control the spending and, therefore, tax relief.
“Maine is a place of great respect for local decision making,” Freeman said. “I think LD1 does a wonderful job of setting the parameters, but it does leave it up to the democratic process. If each level of government is responsive to what their citizens want, the people who want property tax relief will get it.”
Freeman said the state has also increased the Homestead Exemption from 7 to 13 percent and doubled the maximum rebate for the “circuit breaker” program, which gives aid to homeowners who are not financially able to pay their property tax burden.
But this is not going far enough for advocates of the TABOR initiative.
“The people on the waterfront are getting whacked and getting whacked harder,” Wibby said, “Especially for people with fixed incomes like elderly folks and veterans. Their incomes don’t match that increase. That’s where the problem arises.”
The TABOR initiative needs around 50,000 signatures by October 21 in order to be put on the November, 2006 ballot as a referendum question. Adams says she already has over half that amount.
Meanwhile, the Citizens Alliance of Maine is developing regional chapters throughout all corners of Maine and the coast, from Kittery all the way to Presque Isle.
“I think that the people speaking through the Citizens Alliance will be formidable,” Wibby said. “If we can educate the voters, I think we have a chance to turn things around.”
Windham’s Lane Hiltunen is organizing a local event as part of the Second Great American Tea Party.
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