Houlton ‘tax council’ to examine cap proposal

HOULTON – Besides discussing the issue at meetings, town officials have taken a broader step toward educating residents regarding the potential impact of the 1 percent tax cap referendum.

Eight residents have agreed to join a committee that will hold its first meeting on Monday evening, Town Clerk Cathy O’Leary confirmed Friday. The group will weigh the impact of the so-called Palesky tax cap, named after tax activist Carol Palesky of Topsham, and also strategize on how best to communicate the anticipated results of the measure to residents.

If approved, the plan would scale back assessed property values to their 1996-97 level and cap property taxes at $10 per $1,000 of valuation. It also would limit assessments to an increase of 2 percent a year while a property remains in a family. One component includes a rollback of property values to 1996 levels, which state supreme court justices and the state attorney general have advised is unconstitutional.

Interim Town Manager Phil McCarthy suggested that the town look into forming a “tax cap council” to advise the community about all aspects of the proposal. Councilors voted unanimously to take McCarthy’s advice at a council meeting on Sept. 13.

McCarthy invited business leaders, school board members and other community residents to join the group. Most of the group’s eight participants own or operate local businesses.

According to an impact analysis by the Maine Municipal Association, Houlton’s property tax commitment would be reduced by 58.1 percent if voters approve the measure. The town manager said that the municipality would lose about $2.5 million in revenues.

In a press release, McCarthy stated that it is “our duty and responsibility to provide as much information as possible to inform our citizens” about the referendum, which will assist them in drawing their own conclusions about how to vote.

Many school boards in the area have spoken out against the tax cap, including SAD 29 in Houlton and the Southern Aroostook Community School District board in Dyer Brook. Both groups say that drastic cuts would have to be made to school budgets if voters approve the Palesky plan.

Carol Palesky, on the other hand, has accused MMA and town officials of trying to scare Mainers into rejecting the tax cap. Supporters of the proposal say that it will strong-arm towns into controlling spending.

Houlton’s tax cap council will meet in the council chambers of the town office Monday evening. The public meeting will begin at 6:30 p.m.