As many Maine residents confront soaring property tax bills, state lawmakers in both parties are proposing a slew of solutions aimed at mitigating the burden.
However, the Mills administration is arguing that the budget situation will limit what the state can do to help.
Many lawmakers who testified Wednesday in support of property tax relief bills said they were doing so in response to an outcry from constituents. But for Rep. Wayne Parry, a Republican from Arundel, it was also personal.
He told the Taxation Committee his 82-year-old mother's property tax bill had doubled in just the past few years. Her Social Security payments, he said, have not.
"We are taxing seniors out of their homes. We've got to do something for the senior population," he said.
The problem is escalating property valuations, which are driving up tax rates even as the state pumps more money into local education funding and maintains its obligation to municipal revenue sharing. Taxpayers are revolting, rejecting school budget referendums in multiple communities last year.
A proposal by Rep. Billy Bob Faulkingham, R-Winterport, would double the homestead exemption from $25,000 to $50,000. Another plan by Democratic state Sen. Joe Baldacci, D-Bangor, would raise the exemption to $95,000 incrementally over the next decade.
Both those proposals were endorsed by the Maine Municipal Association, which represents municipalities.
But Mike Allen, of Maine Revenue Services, said both measures would increase the state's exemption costs by tens of millions of dollars. That's because the state reimburses municipalities more than 75% of the property tax revenue lost to the homestead exemption. He said Faulkingham's bill would increase the state cost of the program to more than $90 million, while Baldacci's would balloon it to $280 million once fully phased in.
Allen said there may be room for targeted relief in the state's Property Tax Fairness program, which provides relief based on people's income and ability to pay property taxes. However, that program will help fewer residents.
