AUGUSTA — Gov. Paul LePage said in a letter to municipal officials across Maine on Thursday that his proposal to cut municipal revenue sharing for the next two years was forced by exceedingly tight budgets in other areas. He urged them to replace complaints with their own ideas to match government spending with available revenues.
Democrats called the letter “insulting.”
In the letter, LePage said he couldn’t cut debt services because the “state must pay its bills” and couldn’t reduce funding for the judicial branch because the state’s courts are running behind schedule.
“Other core state functions — state police, corrections, our natural resources agencies — have been cut to the bone to feed continued growth in education and welfare spending, and they cannot be cut any further without reducing public safety or our future economy,” wrote LePage, according to a press release. “That leaves only the three large pots of money, and I chose revenue sharing.”
Municipal revenue sharing is a mechanism that the state uses to prevent local municipal budgets from relying too heavily on property taxes. When it is fully funded, towns and cities receive 5 percent of income and sales tax receipts, though in recent years the Legislature has reduced that amount to balance the state budget. LePage proposed suspending municipal revenue sharing altogether in his biennial budget proposal, which covers the two years beginning July 1 of this year.
To date, the Senate has accepted resolutions from more than 50 towns, cities and school districts in opposition to the proposed budget. According to a group called the Fair Share Now! coalition, which has a website that tracks which towns have passed or are working on resolutions against the state budget, more than 70 municipalities have passed resolutions opposing the budget and another 30 or more are considering them.
LePage argues that local governments can make the needed cuts to their budgets, even though he acknowledged it won’t be easy.
“Most letters I receive say we made the wrong choice and that we should restore the $200 million subsidy to municipalities, but they do not suggest other cuts that should be made at the state level,” said LePage, according to the press release. “It is easy to find fault and hard to find solutions. I welcome any suggestions town officials have to cut elsewhere in the state budget, but it is time for everyone to set complaints aside and offer solutions.”
The liberal Maine People’s Alliance attacked LePage for the letter and said that many municipal officials have suggested adjustments to the state’s tax code — such as reversing tax cuts for higher earners which were enacted by LePage and the Republican-controlled Legislature two years ago.
“In the months since the launch of the town resolution campaign, more than 70 town representative bodies have passed resolutions condemning Gov. LePage’s budget proposal and demanding a fairer approach,” said Maine People’s Alliance spokesman Mike Tipping, who is a blogger for the Bangor Daily News. “More than 40 percent of Maine people now live in a town that has passed a fair share resolution and more are passing each week.”
Senate Majority Leader Seth Goodall, D-Richmond, said most towns and cities have already cut as much as they can.
“You can’t deny the fact that the governor’s budget passes the buck on to our towns and raises taxes,” said Goodall in a prepared statement. “Maine’s municipalities have already been working together for years seeking savings.”
The Legislature’s Taxation Committee started holding public hearings this week on a number of Democrat-sponsored bills that would raise taxes. A hearing Friday will address a bill that calls for a sales tax increase to support municipal sharing.