By Thursday, the Maine Legislature will have the opportunity to enact sweeping property tax reform legislation. The property tax reform package that will come before lawmakers this week is the product of hundreds of hours of research, number crunching, reflection and – above all – cooperation.

In the opening days of the session, the Legislature voted to create a new committee to draft property tax reform legislation. It was a great honor to be appointed to serve on the new Joint Select Committee on Property Tax Reform, and also a great challenge.

As the bipartisan committee began its work, we used the governor’s proposal as a framework with which to craft a property tax reform package that would best meet the needs of Maine people. In the end, the legislation the committee is recommending is substantially different from what the governor proposed.

I went about this work with three principles in mind. First, that Mainer’s who can least afford their property taxes need our help – now. Second, that all Maine residents, regardless of income, deserve property tax relief. And finally, that true tax relief will only come if we can slow the growth of government.

The committee members agreed that those people hardest hit by rising property taxes deserve the most help in making ends meet. That’s why the committee recommended that the program known as the Circuit Breaker be expanded so that many more Mainers will qualify and the rebate will be much bigger. The rebate to Maine property taxpayers with low incomes and high property tax bills could be as much as $2,000. The Circuit Breaker is also available to Maine residents who pay a high portion of their income in rent on their primary residence.

The Homestead Exemption Program is another existing program that has been given a makeover by the committee. The Homestead Exemption is offered to every Maine resident homeowner and reflects my second principle that all Maine homeowners need a break. The committee voted to increase the Homestead exemption from the current $7,000 exemption to $13,000. This means on a home valued at $100,000, a Maine taxpayer would only pay taxes on $87,000 of the value. In Monmouth – with a mill rate of $22.4 – this would mean a savings of $291.

In addition to the Homestead, all property taxpayers will feel the relief from the greatest infusion of state school funding in decades. The state’s share will be boosted to 50 percent in two years and to 55 percent in four. Getting to 50 percent in two years means an additional $250 million commitment from the state over the $1.4 billion we currently spend.

The legislation also implements the Essential Programs and Services formula for school funding. EPS is the first school funding model that actually takes into account adequate spending to educate a child. It will bring some rhyme and reason to a process that hasn’t always had it. The transition to the new funding model will change how state is distributed, but the state is setting aside money to ensure that no district loses funding in the first year.

The third part of this tax reform package is our effort to bring the overall tax burden felt by Mainers down from its current rank of second in the nation to the middle third within the next ten years. To accomplish this, the committee voted in favor of strict spending caps at all levels of government.

The committee is also recommending five constitutional amendments to allow municipalities to respond to the unique needs of their area. Currently all property must be taxed equally, based on its highest and best use. The amendments are designed to give towns the ability to offer relief to people that are being affected by rapidly rising property values.

The process was intense and difficult at times, with every member putting in many long hours over the last six weeks. I want to thank my colleagues for their good work and tremendous efforts to bring the Legislature what is a truly bipartisan and far-reaching proposal for property tax reform. Given the superb level of cooperation, I’m very confident we will succeed in passing this property tax reform legislation.

We were committed to doing good work, and that good-faith effort is reflected in the property tax reform package.

Rep. Nancy E. Smith, D-Monmouth, represents District 80, comprising the towns of Litchfield, Monmouth and Wales. This is her second term in the Maine Legislature.

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