State Budget Includes Republican Proposal for Property Tax Relief
Hello, this is Representative Dennis Keschl from Belgrade. I am a member of the Legislature’s Appropriations Committee, and the Town Manager for the Town of Belgrade.
Just this week, the Appropriations Committee completed its work on a proposed two-year budget. Several previous Republican radio addresses have outlined serious concerns about the proposal submitted by Governor Mills. Among those concerns were:
- The Governor proposed to increase the current budget by 11%, spending 99.995% of all available monies in order to avoid raising taxes this year. It only saved 5 cents out of every dollar taken in from taxpayers in case something unexpected happens,
- The Governor proposed to cut back on the increase to revenue sharing that was promised by the 128th Legislature,
- The Governor relied on one-time sources of revenues that will not be available during the next biennial budget, thus creating a serious revenue gap in the coming years, and, she proposed several new initiatives that will negatively impact local property taxes going forward.
These concerns about Governor Mills’ budget remain, especially regarding its long-term impact on family budgets, and on local property taxes.
None-the-less, the Republican members of the Appropriation Committee,
led by Senator Jim Hamper and Representative Sawin Millett were able to reduce the spending proposed in the Governor’s budget to under $8 billion, while increasing funding for education, and restoring money to our tech centers, workforce training and health care.
Perhaps most importantly, Republicans were able to provide increased property tax relief and savings in the State’s Rainy Day Fund.
As a Town Manager, I had one serious concern as I joined the 129th Legislature…property tax relief. This concern was shared by all Republicans on the Appropriations Committee.
We know that local property taxes are already too high. To fund her new spending initiatives, Governor Mills proposed cutting revenue sharing to towns and cities by $160 million.
Less revenue to local towns usually results in higher taxes and less money for local road repairs.
The budget that is now being considered by the full Legislature is slightly less onerous than Governor Mill’s original proposal
It now stands at just under $8 billion…and it is not the budget that Republicans would propose if we were in charge.
However, the proposal does contain important provisions that Republicans were successful in having included in the budget. Among these are:
Property tax relief!
The so-called Keschl/Millet budget proposal allocates an additional $75 million in property tax relief…
To give direct tax relief to homeowners, the budget increases the Homestead Exemption by $5,000 to allow Maine residents to exempt
$25,000 from their property taxes without increasing the impact on local municipalities because we offset this increase by requiring the State to pay 70% of the cost of this initiative.
Republicans insisted on this type of tax relief, because it goes directly to homeowners in the form of lower tax bills.
In addition, in an effort to provide relief to nearly 13,000 low-income taxpayers, this budget expands the eligibility for the Property Tax Fairness Credit.
Finally, we increased revenue sharing from the 2.5% In FY20 and 3.0% in FY21 to 3.0% and 3.8%, and for those local municipalities who have already gone to Town Meeting, there is a provision that they will not have to go back to Town Meeting to spend this year’s increased amount of Revenue Sharing… if they spend it on road repairs or to reduce their property tax commitment.
While this only partly restores the Governor’s proposed revenue sharing cuts to towns and cities we were able to make substantial progress in fulfilling our commitment to providing the full 5% of Revenue Sharing promised.
Republicans were also successful in increasing funds for career and technical education by more than 2.5 million dollars, as recommended
by Republican members of the Education Committee.
It remains to be seen if the majority budget reported out of the Appropriations Committee has enough support to get the required two-thirds vote of the House and Senate to become law.
However, one thing is certain, Maine Republicans in the Legislature will continue to fight for tax relief, even though Democrats control Augusta.
We know how hard you work and want to ensure that we can let you keep as much of your earnings as possible. You know how best to spend those hard-earned dollars.
This is Representative Dennis Keschl from Belgrade, thank you for listening.
Representative Dennis Keschl represents House District 76, the towns of Belgrade, Fayette, Mount Vernon, Rome, Vienna and Wayne.