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Maine municipalities receive 5% of state revenues under sharing program

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Rebecca Conley
/
Maine Public
The State House dome in Dec. 2018.

For the first time 13 years, Maine municipalities received a 5% share of state revenues collected from sales, personal and corporate income taxes. Democratic Gov. Janet Mills is touting the bump in revenue sharing as part of her ongoing effort to mitigate property tax increases.

The state budget office says the increase in the revenue sharing program will send more than $233 million to Maine cities and towns in fiscal year 2023.

That's a half of a percent increase over last year and part of an upward trend since Mills took office in 2019, made possible by budgets approved by the Legislature.

Former Republican Gov. Paul LePage, Mills' predecessor and reelection opponent, held revenue sharing at 2% during most of his two terms, arguing that sending more money to municipalities did not guarantee that it would be used to lower property taxes.

He once proposed taxing nonprofits, which along with land conservation, he blamed for the state's high property tax burden.

Maine Municipal Association Kate Dufour says the uptick in revenue sharing over the last three years is welcomed by the hundreds of cities and towns her organization represents.

"The bottom line is that the increase in the revenue sharing has certainly helped keep the pressure off the property taxpayers," she said.

Despite the state's renewed commitment to revenue sharing, Dufour acknowledges that some municipalities have raised property taxes, which in some cases may have been driven by higher county taxes, local education funding decisions and workforce challenges.

Property taxes account for nearly all municipal revenues in Maine and other New England states.

Maine ranks No. 9 in property tax burden nationwide, while neighboring New Hampshire, which uses property taxes to fund most of its public education costs, is No. 2.