Home-grown carrots

The half-cent reduction in the Maine sales tax last week did not send the public on a spending spree. Such restraint would be wise among those politicians now shopping for further tax cuts.

Not that lower taxes aren’t a good thing at any time. They are. The question is whether they’re the smart thing at this time. Maine’s tax burden has been lowered by $300 million in the last year, state revenues are robust yet unpredictable, the global economic situation is in turmoil, domestic financial markets are on a roller coaster. Cautious assessment is called for.

But standing pat does not mean doing nothing. For, unless one wants to count on uninterrupted growth, tax cuts inevitably must be accompanied by some degree of spending cuts. For that, Mainers should look not to Augusta but closer to home.

The consolidation of services at the local level is long overdue. Despite years of talk about change, towns, cities, counties and school districts continue to operate as though in a vacuum and efforts at the state level to encourage the sharing of equipment, supplies and personnel have drawn a blank. Meanwhile, the total cost of local government in Maine has grown to more than $1.5 billion.

Gov. King has preached about the need for consolidated services since the days when he was Candidate King. An excellent proposal by the State Planning Office last year that would help county governments become centers for regional cooperation got shredded by worries about the loss of so-called local control. Now, after four years of begging, pleading and occasionally scolding, the governor has a better idea — carrots, not sticks.

The first manifestation of this policy of rewarding communities that work together is the new Superpark industrial site being planned in Oakland. More than 30 towns along the Kennebec are joining hands to build a home for high-tech companies; they share the costs and they’ll share the profits. They laid their local jealousies aside not because they were shamed into it, but because it paid to do so. A cool $1 million.

The governor credits Steven Levesque, acting commissioner of economic and community development, with this brainstorm — hold back $1 million of the federal Community Development Block Grant money that comes to Maine and offer it as a bonus to towns that find a way to grow together. The bonus won’t make a huge difference in each town’s share of the Superpark’s estimated $12 million cost; it just made cooperation hard to resist.

Gov. King is still pondering ways to make this one-time experiment a standing offer. One idea being worked over is to boost the state’s revenue-sharing distribution to localities that create efficiencies through cooperation. After all, reducing the $1.2 billion cost of local government by a mere 5 percent results in a tax break of $60 million, with no reduction in services. So, as if the unstable world situation weren’t reason enough for prudence, lawmakers might want to consider that there’s more than one way to reduce the tax burden and that incentives can work. And local government might at last realize that, like carrots, the best tax cuts are home-grown.