Milo manager says tax cap would sink town

MILO – Town Manager Jane Jones has issued a challenge to supporters of the Palesky tax cap initiative, even Carol Palesky herself: Come to Milo and show her in black and white how the town can operate on 10 mills, or $10 per $1,000 valuation.

“The sheer arrogance of thinking that what works in Portland would work in Milo is ridiculous,” Jones said Tuesday.

Palesky supporters assume that one size fits all, the town manager said, and they have ignored Maine’s small, rural communities that have a very different fiscal operation.

If the Palesky tax cap is adopted and withstands the anticipated court challenges, then Milo will cease to exist, Jones said.

There would be no recreation department, the library would be mothballed, and the town office would be closed because there would be no employees to staff it, she said. There would be no funds to ensure that firefighters received necessary training and equipment nor would there be funds to address state and federal regulations. It would mean the end of road improvements and streetlights.

“The true irony here is the only department which can survive is the cemetery,” Jones said.

The tax initiative on the November ballot will ask whether voters want to limit property taxes to 1 percent of the assessed value of property. If approved, the maximum tax rate a municipality could charge would be 10 mills.

This year, Milo paid about 15 mills, or $840,000, to support SAD 41 and about 1 mill, or $105,000, to support county government. In addition, the town paid about 2 mills to the sewer and water district and 1 mill to the Penquis Solid Waste Association. That’s a total of 19 mills without even considering the other aspects of municipal government, according to Jones.

The town billed out $1,450,000 in taxes this year. Under the tax cap, the town could bill no more than $600,000, she said.

“You cannot fund municipal, county and educational services that represent $1,450,000 on $600,000 – it just can’t be done,” Jones said. “There is no way of rolling back our tax base.”

Jones said municipal officials realize there is a large taxation problem, but destroying and gutting the small towns in Maine is not the solution.

“We now have a convoluted, top-heavy tax structure [at the state level] with so many exemptions that’s it difficult to cut through to the core and see what the possible solutions might be,” she said. She said she thought the solution might lie with the sales tax.

Adopting the Palesky tax cap is like “taking a medical problem and deciding that the tool you’re going to use is a chain saw,” Jones said. It would eliminate the town, and that would be a shame after all the hard work by residents and municipal officials to improve the community and the economy, she noted.

For example, for the first time in a decade, the mill rate was reduced, taking it from $24.85 to $24.40 per $1,000 valuation.

“Milo has gone so far in the past few years in turning around an economic situation it fell victim to,” the town manager said.

Local participation at town functions is up, and the town is poised to open a regional industrial park to bring further prosperity to the town. Jones said it was unconscionable to think anyone would impose a solution on the town that would destroy all of that work. “This negates seven or eight years of extremely hard work on the part of all of the community.”

Jones said the tax cap is anti-Maine, anti-small town, and anti-local control. It’s a “sugar-coated solution” to a huge problem that has been caused by the state’s long-term neglect of tax reform, she said.

What’s unusual about the Palesky tax proposal is that it’s supposed to be grass roots but it’s flying in the face of every grass-root effort in Maine, Jones said. She said the tax cap would strip the rights and responsibilities of local residents and would gut the town meeting form of government.

She said she believes that once residents understand the workings of the tax cap proposal, they will reject it. Milo residents are “very resilient people, very self-willed in terms of making their own decisions” and speak their minds at town meetings, she said.

“I don’t believe they’ll want those rights taken away from them,” the town manager said.