Weighing in on municipal revenue-sharing

By Kathy Littlefield | Jan 16, 2014

The Waldo County Municipal Association would also like to weigh in on the subject of municipal revenue-sharing, a law passed in 1972 that requires the state to share 5 percent of its income and sales-tax revenue with cities and towns to keep property taxes as low as possible.

I go back a long time in municipal business — 41 years, in fact. Time and again over those decades I have seen the legislature renege on their promises and shift all manner of things back onto the towns and cities. I wish I could believe that state legislators no longer wish to eliminate municipal revenue sharing, but sadly I can't say that. I believe they won't stop until the have it all. Although they preach to the municipalities to “control your spending,” they take a different path for themselves — they take the easy way out.

To me, it's like a child who knows there are four cookies left in the cookie jar. He won't settle for one; he nags and cries until he gets his way and eventually has them all.

Municipalities do try to control spending: we try to control General Assistance and still abide by the laws that our Legislature has passed; we try to control our spending for animal control and still abide by laws they passed; we try to control spending in our personnel dept and still abide by laws they passed; we manage the disposal of all solid waste, conduct all the elections that put them in office, review all subdivisions, manage development in the shoreland zone, clear and maintain the roads, fight the fires, provide emergency medical services ... and still try to abide by all the laws they have passed.

We have the Department of Labor regulations to comply with; Workers' Compensation regulations to comply with; we have Freedom of Access laws to comply with; we have a state building code to comply with; and, yes, there is the school consolidation fiasco that we are still dealing with — a bold new idea from Augusta which we were assured would save the taxpayers a lot of money, and how did that work out?

And then there are always the “programs” that come about and the old “bait and switch” deals. The TRI (Town Road Improvement), the Snow Plow Reimbursement, DOT Block Grant, all of which were rolled into the Local Road Assistance Program, or LRAP, with new rules, new qualifying requirements, more paperwork and less money. Then LRAP was rolled into the Urban Rural Initiative Program (URIP) with so many restrictions the resources could not even be used to actually plow the state's roads. For countless years we were encouraged to fix-up our roads to meet state standards so that the state would then take them over, only to have the state turn around and give many roads back to the towns, many of which were in poor condition.

In the early 1990s there was a round of road “reclassifications” which, for many towns, was just another way to dump more roads onto local government. The most recent version, the “Highway Simplification Program” was another major road “give-back” deal floated a few years ago. It failed, or did it, really? There are no roads back yet but starting in 2015, there will be 10 percent less money in the Local Road Assistance Program!

In 1983, the legislature established the obligation for the state to pay 55 percent of the total cost of public education but almost immediately began contributing less and less. In 2004 the voters of Maine re-established that obligation, but the legislature has continued to go backwards. Today, three decades after the 55-percent standard was first adopted, the state is barely paying 44 percent. And it's not over yet. The legislature has passed and continues to pass mandate after mandate onto the municipalities — you got it — unfunded.

Finally we come to revenue sharing, which was started in 1972 as a partnership between the towns and the state. This contract or compact or agreement — whatever you want to call it — was honored up to 2008 with just a one-time raid in 1992. Since 2009, however, revenue sharing has been raided by the legislature every single year, and every year more deeply than the last.

Waldo County will suffer a $804,948 loss in revenue sharing for Fiscal Year 2014, and that's in addition to the reductions that have already occurred in previous years. Since the “Tax Expenditure Review Task Force” failed in its charge to make the necessary recommendations to find an additional $40 million for the budget, the revenue sharing that hasn't yet been raided has become the last of the cookies in the cookie jar.

These decisions you make are a direct hit to the property taxpayer because our towns and cities simply have nowhere else to go. We operate on an inverted pyramid. Everything comes down the chute for the municipalities to deal with or, more correctly, without. We have cut back on services, we have cut back on road repair, we have cut back on salt and sand, we have cut back on our maintenance of our buildings, we have cut back, or eliminated in many cases, our reserve accounts, we have in many cases used up or greatly depleted our surplus accounts, just to keep taxes down.

For the biggest bills we have, from the schools and the counties, we have little say over the bottom line. We just have to pay them. Our infrastructure is literally collapsing, our people are being expected to deal with never ending rules and regulations and laws coming from Augusta with less and less money. You simply have to understand that this cannot go on. Our people cannot sustain it: They are losing their homes!

We know that the Waldo County delegation numbers only six legislators among 186, but it can reach out to other delegations. It can lobby them hard and lobby the committees, but most importantly, its members can stand up and be counted, send a loud and clear message that they will not support further reductions in municipal revenue sharing.

State government in Maine, I am very sad to say, has lost all credibility and trust, not just with municipalities but, more importantly with its people. I believe regaining that trust should be a priority and this would be a good place to start.

Kathy Littlefield is Chair of the Waldo County Municipal Association.

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