AUGUSTA (AP) – The Maine Municipal Association holds its annual convention in a month and this year the focus is the proposed statewide property tax cap that will be on the ballot Nov. 2.

Fresh from winning passage of a citizen initiative of its own, the MMA has joined with other participants in that earlier battle to urge rejection of the California-style measure championed by anti-tax activist Carol Palesky.

The so-called Palesky proposal would cap property taxes at $10 per $1,000 of assessed value, based on values in 1996-97. It also would limit assessment increases to 2 percent a year while the property’s ownership remains in a family.

Already, a Maine Supreme Judicial Court majority has said in an advisory opinion that at least part of the proposal – its provisions for establishing the value of property – would be unlawful.

“The Maine Municipal Association has conducted an analysis of the Palesky Proposal that assumes the unconstitutional rollback in valuations will be severed and that only the 10 mill cap will remain,” the organization says on its Web site.

“Under this likely’ scenario the municipal tax revenue loss in FY 06 would be nearly $600 million, representing a 30 percent reduction in property tax revenues.

“If the proposal were enacted as written’ revenues would be cut by over $900 million! Either way, a loss of revenue on this scale would have devastating impacts on municipal service delivery and our public schools,” the MMA says.

In the most recent issue of the organization’s magazine, MMA executive Director Chris Lockwood writes that the theme of the three-day convention running Oct. 6-8 at the Augusta Civic Center will be “Meeting the Challenge.”

Tax Cap YES!, a group promoting passage of the tax cap proposal, positions itself as a challenger to the state’s political establishment.

“The truth is government spending is going up faster than we can pay for it,” the organization states on its Web site.

“Over the last 20 years, Maine state and local government spending has increased at nearly three times the rate of inflation and 25 percent faster than our paychecks. Maine’s property tax revenues increased more than 80 percent from 1990-2000, and many towns have seen their property tax revenues double over the last decade.

“Maine residents now pay the highest property taxes in the country as a percentage of personal income. Maine’s overall tax burden is 20 percent above the U.S. average while Maine’s per capita income is 10 percent lower than the average U.S. income. These are not our facts – they come from the U.S. Census and Maine state government,” the pro-tax cap group says.

New radio ads build on the proponents’ arguments that government is seeking to protect itself and citizens must speak out against “reckless” spending.

“Have you heard the scare tactics?” asks an announcer in one ad.

“They’ve started already: Big labor unions, special interests, Augusta’s political insiders want you to think the world will come to an end if we cap taxes. They threaten school closings. Shutting down fire departments. Taking police off our streets.

“Come on.”

In June, voters approved an MMA-backed ballot question to increase state aid for public schools from about 42 percent to 55 percent of total costs. The proposal was touted as a way to reduce property taxes by shifting more of the cost of local education to the state.

Immediately after the vote, Gov. John Baldacci said he wanted to join forces with the winning side to defeat this November’s tax cap initiative.

Tax Cap Yes: www.taxcapyes.com

Maine Municipal Association: www.memun.org



The MMA Web site described the pending proposal as “The Danger Ahead.”