HOULTON – At the first meeting of the town’s newly organized tax cap council on Monday evening, each person on the eight-member panel spoke of the “devastating” impact the 1 percent tax cap referendum will have if it passes in November.

After the meeting, Stan Ginish, one of a handful of audience members, said that the panel had “shown their bias” and said that he planned to vote in support of the tax cap.

For the most part, Ginish was in the minority.

“All this [tax cap] is going to do [if it passes] is cause chaos,” committee member Jim Brown said during the meeting. “We need to communicate that. It is going to shut the state down, basically.”

The group was formed to weigh the impact of the so-called Palesky tax cap, named after tax activist Carol Palesky of Topsham. The panel also will plan strategy on how best to communicate the anticipated results of the measure to residents. Another public meeting is scheduled for Monday, Oct. 4.

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.

According to an impact analysis by the Maine Municipal Association, the town’s property tax commitment would be reduced by 58.1 percent if voters approve the measure. McCarthy said Monday evening that the municipality would lose about $2.7 million in revenues.

“With $2.7 million less in the budget if this passes,” he said, “how do we fill the void, how do we meet that need in order to keep the keep the town running?”

During the meeting, the group contended that the town would not have enough money to pay its bill to SAD 29, which taxes 11 mills from the municipal budget just for education. Towns are mandated by law to pay such bills.

“What worries me the most is how many people I am going to have to lay off if this passes,” Frank Dunn, a panelist who owns a furniture store, said at the meeting.

The group pored through financial figures the town has provided. The town maintains that it would have to eliminate all funding to outside agencies, including the Southern Aroostook Development Corp. and Cary Library, if voters approve the cap. The community would not have the money to maintain its famed “Boy and the Boot” statue, and the recreation department might have to consider eliminating programs or raising fees so youth could participate in basketball or soccer.

Committee member Mitch Holmes said he was well aware of what would happen if the measure goes into effect, but expressed concern that other residents do not.

“There are so many people out there that don’t know what is going to happen if this passes,” Holmes said. “We have to look at that.”

The group discussed putting factual information about the tax cap on the town’s Web site and public access channel, and also mailing the information to residents. Final decisions will be made at the next meeting.

Panelist Mike Carpenter thought that writing letters to local newspapers also would help.

“This thing is being driven by people who are angry and frustrated at government spending,” he told the group. “We’ve got to address that. We can’t go to the public and say, ‘Vote against this because it’s bad.'”

Government spending is one issue that has prompted Stan Ginish to support the Palesky plan. After the meeting, the Houlton resident said that the municipality could garner revenue that would be lost under the cap by consolidating area schools and cutting other spending.

Town Councilor Phil Bernaiche, who also attended the meeting, said that he would continue to support the tax cap. Bernaiche called the town’s talk of massive cuts “scare tactics,” and said that the ambulance service “wasn’t going to let anybody die” even if there were no funding for the group to function.

Believing that the tax council was not going to look at the benefits of Palesky’s initiative, Ginish decided to join the group on Monday evening.

He plans to make his views known when the group meets again next week.