AUGUSTA – Atkinson residents seeking to deorganize their small Piscataquis County town cleared another hurdle Wednesday when the State and Local Government Committee voted 7-3 to recommend that the Legislature authorize the request.

If the Legislature approves the bill, which is opposed by Gov. John Baldacci and Doreen Sheive, fiscal administrator of unorganized territories, among others, the ultimate say on deorganization will be decided by Atkinson’s 333 residents during a referendum question in November 2004.

LD 1671, which was presented by Rep. James Annis, R-Dover-Foxcroft, and co-sponsored by Sen. Paul Davis Sr., R-Sangerville, carries an amendment that makes Atkinson, currently a member of Hospital Administrative District 4, responsible for its share of bonded indebtedness for 20 years should it deorganize.

Speaking in opposition to the bill Wednesday, Rep. Christopher Bastow, D-Gorham, said its approval could be a “destabilizing factor” and encourage other towns to go through the process.

But Rep. Robert Crosthwaite, R-Ellsworth, said the Legislature will have to deal with that. “There has to be a place where we step aside and recognize home rule for what it is,” he said.

Atkinson’s problem boils down to property taxes. Of the approximately 23,000 acres in the town, 66 percent of it is either in a tax break or tax-exempt program, either tree growth, open space, or wildlife preserve. Supporters say that creates a huge imbalance and transfers the tax burden to remaining property taxpayers. Forty-six percent of the households in the town make less than $25,000 a year, according to Annis.

This is the second time Atkinson has attempted to deorganize. The Legislature approved a similar bill in 2001 but the vote conducted by Atkinson residents favoring deorganization, 144-86, failed to carry the two-thirds majority required to complete the process. It is the only town exempt from new regulations imposed by the state that tightened up the process of deorganization.

Before the “ought to pass” was recommended Wednesday, committee members discussed several issues relating to the process, including the effect the move would have on SAD 41 (Milo, Brownville, LaGrange and Lakeview). In the original request to deorganize, residents changed districts from SAD 41 to SAD 68. When it appeared there was little support on the state committee for the school change based on SAD 41’s projected subsidy and assessment loss of $360,000, residents amended the plan to retain SAD 41 as the designated district.

The fact that Maine law allows the director of state schools in unorganized territories to provide tuition to another approved school if a parent made the request bothered Rep. and House Chair Janet McLaughlin, D-Cape Elizabeth. She feared parents would skirt SAD 41 by using this method.

If parents received permission to enroll their students at Foxcroft Academy, an independent school in Dover-Foxcroft, McLaughlin was told that the state would be required to pay 10 percent more than it currently pays SAD 41. Parents would be required to pay transportation to and from the school and any additional tuition requested by Foxcroft Academy.

McLaughlin, who was asked by Atkinson resident George Johnson before the work session to abstain from voting because of remarks she made at a public hearing last month, said she would not, and voted against the bill. McLaughlin said last month that she had relatives in the Milo-Brownville area and that Atkinson’s deorganization would likely increase taxes in those two communities. The fact that she had relatives in the area tuned her in more than people would expect of a person from Cape Elizabeth, she said.

Also on Wednesday, Johnson gave the committee a history lesson about Piscataquis County, which has 89 unorganized territories. Of the 19 organized towns, he said, Atkinson has the highest tax rate with no services provided. He said in 2002, the town had $31,000 in unpaid taxes and after increasing the mill rate to $19 per $1,000 in 2003, the town in January of this year had $71,000 in unpaid taxes.

If Atkinson had deorganized in 2003, it would have paid nearly $8 per $1,000 valuation. Its inclusion as an unorganized territory would increase the mill rate for the UT’s in Piscataquis County by 3.5 percent per $1,000 valuation and the mill rate for all other UT’s in the state by 1.25 percent per $1,000 valuation, according to state officials.

Based on that, Rep. Edward Suslovic, D-Portland, said, “We’re not reducing costs here, we’re just shifting costs.”

But Rep. Gary Sukeforth, U-Union, said Atkinson had played by the rules and had “jumped through the hoops” and deserved a chance to vote on the matter.