We’re trying something new today we’re calling P&S, or “Problem and Solution.”

We’ll identify a problem, propose a solution and then invite you to give us feedback on our solution or propose one of your own. In a couple of days, the best of your responses will appear in this space.

After reading today’s P&S editorial, you can respond by either visiting www.sunjournal.com and clicking on the “Our View” button in the blog listings or by simply sending an e-mail to: [email protected].

The problem:
Fixed incomes

and escalating

property taxes

There’s a brush fire burning in Maine and it’s spreading. Property taxes, particularly in urban centers, are too high and are growing too quickly.

Several risky referendums have been proposed that would forcefully restrict property tax increases, taking these decisions out of the hands of elected officials. Some of these ideas have been tried elsewhere, usually with dismal results.

The property tax complaint that seems to resonate the most strongly with the public is that many seniors are increasingly squeezed between fixed incomes and escalating property taxes.

While we have found little evidence to support the idea that seniors are being forced out of their homes, we do think that growing property taxes are an increasing burden for the people who are the least able to pay.

Even worse, too many seniors live with the fear and stress of being unable to predict or control how their property taxes will grow.

The solution:
Program to allow

delayed payment

The state could establish a program that would be administered by municipalities to allow property tax increases to accrue and be paid, with interest, when the property changes hands.

The criteria for the program would be simple: Seniors who reached 65, had retired from full-time work and had relatively fixed incomes would agree to enter the program.

From that point forward, their property tax payments would never increase. If they paid $2,000 per year when they entered the program, they could count on paying that amount until the property changed hands.

Their property taxes would still go up, but the increased amount would be held as a lien against the value of the house. Interest on this amount could accrue at a market rate, and with a small administration cost added.

When the property eventually sold, the balance owed would be paid to the municipality with interest from the proceeds of the sale.

The property would be assessed when it entered the program, and the accumulated taxes would not be allowed to grow beyond that assessed amount, or some fixed percentage of that amount.

The advantages: Seniors on fixed incomes would pay a level and predictable amount of tax until they decided to leave their homes.

For municipalities, this program would blunt the single most damaging argument for more radical programs, that people on fixed incomes face punishing tax increases.

The disadvantages: Seniors and their heirs would receive less cash from the sale of a home. However, the escalating value of homes would likely cover the accrued tax repayment.

Municipalities, meanwhile, could suffer an initial hit as the program got rolling. Eventually, though, homes would sell and tax money would be rolling in to offset the loss of new tax revenue from people joining the program.

Naturally, rules would be written to anticipate special circumstances that might arise. And the Legislature would have to change at least one statute that requires timely collection of taxes.

But the concept, in our opinion, is sound and worth further study.

Your response:

Again, you may respond or read discussion of this issue by visiting the blog listing on the homepage of www.sunjournal.com or by sending an e-mail to [email protected].

If you are a senior, would you be interested in such a program? Let us know.

Next week, the best of your comments and ideas will appear in this space.