It is doubtful that Gov. Paul LePage’s plan to eliminate municipal revenue sharing will survive the budget process. More likely, legislators will find some mix of spending cuts and revenue increases that is not so demanding of average taxpayers. It will take creativity and flexibility on the part of the lawmakers, two traits the governor could use more of as he works to “move Maine forward,” as he said in his most recent weekly address.
The governor is right that balancing Maine’s budget in this climate will take tough decisions. But he is wrong take away revenue sharing in its entirety and pass those tough decisions onto municipalities. Revenue sharing is not an allowance. It is the statutory recognition of the harm caused by rising property taxes on Maine’s middle class.
Take, for instance, the city of Westbrook, which stands to lose $1.5 million in the next two years if revenue sharing is eliminated. Add in changes to school funding and excise tax collection, among other aspects of the budget proposal, and Westbrook could take a hit of as much as $3.3 million in the coming fiscal year, knocking the property tax rate up $1.82 per $1,000 of valuation. That’s an increase of $364 for a family in a $200,000 home, before changes to the Homestead Property Tax Exemption and circuit-breaker programs are considered. It would be a devastating hit to taxpayers already struggling to pay the bills.
Lawmakers seem to recognize the impact this would have on residents. Leading senators on both sides of the aisle – Republican Roger Katz, the assistant Senate minority leader, and Democrat Justin Alfond, the Senate president – have each entered bills that would push the state toward restoring the full level of revenue sharing. That would make it more difficult for the state to dip into those funds to balance the budget, something that occurred during the Baldacci administration, as well.
That sort of agreement makes it more likely that legislators can forge some sort of compromise during the upcoming budget review. LePage, however, is a different story. He has so far refused to meet with Democratic leaders, and his insistence that tax increases are not an option raises concern of an impasse and possible state government shutdown. Now, with this budget proposal, he is painting all municipalities and school departments as wasteful. He is handing them a funding cut that is significant following a decade of belt-tightening and telling them to figure it out.
Instead, the governor should be offering a broader carrot-and-stick program that incentivizes cooperation and consolidation at the local level. He should be highlighting model communities and programs so that others can follow. He should be targeting cuts so that local governments that actually are wasteful or inefficient are feeling the brunt.
He should be leading instead of making others do the hard work.
Ben Bragdon, managing editor
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