AUGUSTA – Maine State Chamber of Commerce President Dana Connors likes the property tax relief package expected to be voted on in the House and Senate Jan. 18, 19 and 20.

Connors calls the package “a stellar recommendation” from the legislative Committee on Property Tax Reform, which approved the bipartisan plan 12-3 on Monday.

While the proposal would provide $225 million in immediate property tax relief throughout Maine – doled out in the new educational funding formula – Connors likes other aspects of the plan: spending caps intended to limit spending in schools, cities and towns, and the state.

It will take some time, but the caps will lower taxes in Maine, Connors predicted.

If the caps are adhered to, Maine’s overall tax burden would go from being in the top one-third in the country to the middle third within eight to 10 years, said House Majority Leader Glenn Cummings, D-Portland.

“The spending caps are very meaningful,” Connors said. “They’ll do the job. We should all take comfort that the committee’s come up with a stellar recommendation.”

The Property Tax Relief Committee is recommending that future state, local, county and schools budgets not be allowed to easily increase more than the rate that personal income is rising in Maine, about 3 percent.

The spending caps for the state, local and county governments are almost the same, said State Planning Director Martha Freeman. One small difference is that the state is allowed a bit more spending if the population grows, and local governments are allowed more when new buildings are built and when there is new tax revenue. That means the state spending cap is 3.1 percent of its annual budget, county and local caps are 3.4 percent of their annual budgets.

School spending would be capped to what the education funding formula allows, which determines amounts based on a district’s student population and property valuation.

Maine Municipal Association spokesman Geoff Herman agreed that the spending caps have potential to lower taxes, and called them “workable and functional. The committee’s done a good job in this area.”

“The caps are quite uniform, which is different than what the governor proposed,” he said.

Connors said he had one concern: how easily a school district, county or municipality could exceed the cap, which would hurt the overall effort of lowering taxes.

The chamber and Gov. John Baldacci had proposed that no government could go over the spending cap without a two-thirds vote by the governing body. If a budget went over, it would then have to approved by residents in a local referendum.

While reviewing the governor’s LD 1, the committee softened that requirement, saying that going over the cap would require only a majority vote, and that it would not have to be approved in referendum. However, the committee also said that the governing body – whether the Legislature or a town council – must vote separately to go over the cap, and would have to make it easy for taxpayers to organize a referendum to reject the higher spending.

“The caps are there as much as a reminder to people that they need to be responsible in requesting services,” said committee member Rep. Arthur Lerman, D-Augusta. “This doesn’t mean that the cap is it, and you can’t go above the cap. He said “there’s a tendency for people to say, I want my taxes low, and I still want services.’ What this does is try to make more of a connection.”

When people want more services – whether that’s a better library, city or town hall, richer school programs – they’ll need to pay for them, Lerman said.