Dexter manager says tax relief plan a ‘scam’

DEXTER – A glimpse of a headline in Thursday’s edition of the Bangor Daily News caused Town Manager Robert Simpson to spew his coffee over his kitchen table.

The headline, “Tax relief savings up, study finds,” cost him the one cup of coffee his wife allows him each morning, he said Friday.

The story relayed that Maine Revenue Services had revised its figures from $207 to $328 as the amount of savings the average residential property owner could expect this year from LD 1, the Legislature’s property tax relief package. The earlier figure did not consider the circuit breaker and homestead plan, the story stated.

Simpson said it was audacious of the Legislature and Gov. John Baldacci to suggest the legislation provides property tax relief – his town will lose more than $80,000 under the new law.

Simpson expressed frustration that the Legislature seemed focused on “railroading” through LD 1 but did not look at the details, and that frustration spilled over at Thursday’s Town Council meeting.

“I think that this piece of legislation is the biggest scam in the state of Maine,” Simpson told the council.

“In some respects, we’d have been better off with Palesky,” he said, referring to Carol Palesky’s attempt to cap property taxes at 1 percent, or $10 per $1,000 of assessed property values for residences and businesses.

“Although it [Palesky] was brain surgery with a meat cleaver, the reality is it was in black and white,” Simpson said Friday. “I knew what I was dealing with. Here, you almost have to have a swami to tell you what you’ve got.”

While each community will see something different in LD 1, the bill represents a loss of $80,845 to Dexter.

Simpson said at Thursday’s meeting that LD 1 increased the homestead exemption from $7,000 to $13,000, which appears to be a savings for property owners. But because the state no longer will cover the full $7,000 cost and has shifted 50 percent of the $13,000 costs to municipalities, towns must either find new taxes or cut and reduce programs, he said.

“We’re robbing Peter today to pay Paul tomorrow,” he told the council.

In addition, the new Essential Programs and Services formula reduces the local school district’s funds by $243,000, so the school district’s budget will be flat funded this year by the state, according to Simpson. The Legislature will meet its 55 percent funding requirement for schools by lowering the amount they are paying school districts, he said.

On top of that, Simpson said, the town has to limit its spending to last year’s base.

“We cut the hell out of our budget last year” in anticipation of passage of Palesky’s tax cap, Simpson said Thursday night.

“This spells a death knell for us, we got duped out of $80,000 and it means somebody’s job,” the town manager said.

Simpson said Friday that legislation such as this makes the rifts among communities much greater.

“I just don’t feel like some of these folks in Augusta are really in touch with people in the field,” the town manager said.