Proponents of water tax submit signatures

AUGUSTA – Leaders of a campaign seeking a tax on water extracted in Maine presented several boxes of petitions to state elections officials Friday, hopeful they had enough valid signatures to force a referendum next year.

“We think we’re about 500 over the minimum,” said Jim Wilfong, the leader of a group called H20 for Maine.

Citizen initiative organizers needed to obtain at least 50,519 signatures by Friday to guarantee a statewide vote by November 2006.

The proposal seeks to tax companies that extract, bottle and sell Maine water 3 cents for every 20 ounces extracted, or about 20 cents per gallon.

Nestle Waters North America – the parent company of Poland Spring, which has bottling plants in Maine and employs 550 people – was closely monitoring the windup of the petition drive. Nestle, along with smaller bottled water companies with Maine operations, would be directly affected by the proposed tax.

“We are disappointed and concerned, and we anxiously await the secretary of state’s ruling on the petitions,” David Burns, director of operations for Poland Spring, said in a statement. “Frankly, we’re surprised that so many registered Maine voters think that the state needs a new tax.”

Money from the tax would be deposited in a trust, whose dividends would be paid to Maine income taxpayers. Portions of the revenues would also fund business loans and water conservation projects.

Projected revenues for the first year of the tax were expected to reach $100 million.

The proposal does not seek to tax water that’s taken from private wells and not resold, water sold by regulated utilities for domestic consumption and the first 500,000 gallons of water extracted per year for sale by water extraction companies.

Wilfong maintains that the water belongs to the people of Maine and that it is fair to ask for something in return when bottling companies are making profits from it.

“It was really retail politics,” he said of the petition drive. “You have to talk to people, you have to educate them.”

Referendum backers have compared the Maine proposal to other states’ extraction taxes on resources such as oil, natural gas and timber.

In May, Michigan’s governor imposed a moratorium on new or expanded bottled water operations in that state until its Legislature passes a water withdrawal law.

In the Poland Spring statement, Kim Jeffery, president of Nestle Waters North America, said corporate consideration of a business expansion in Maine would be put on hold.

“If this tax ever were to be approved, we would have to seriously re-evaluate our ability to continue to do business in Maine,” Jeffery said. “This tax hobbles Maine water bottlers like us because large national companies like Coke and Pepsi that bottle their water outside Maine and sell it alongside ours won’t be burdened with this tax. Why would Maine people put a Maine-made product at such a disadvantage?”