AUGUSTA – Maine lawmakers gave final approval to a wide-ranging property tax relief measure Thursday night, although strong House and Senate majorities fell short of the two-thirds thresholds needed to have a new law take effect immediately.
Backers celebrated anyway. The final version of the bill carried specific dates of implementation for its major provisions and supporters said its retroactive elements would effectively trigger more aid for schools and taxpayers on time.
Gov. John Baldacci planned to sign the measure this afternoon. In an impromptu appearance Thursday night on Maine public television’s Capitol Connection program, Baldacci expressed satisfaction with the legislative outcome.
“A lot of people didn’t give us a chance (of) getting this done,” he said.
Enactment votes were 95-49 in the House and 23-10 in the Senate.
Calling the tax relief package a “historic first step,” Democratic Sen. Dennis Damon of Trenton told the Senate he believed the Joint Select Committee on Property Tax Reform that he co-chaired had rendered Baldacci’s original proposal “a stronger and more comprehensive” bill.
Despite Republican misgivings, all but final approval came in the Senate by a vote of 23-11 after half a dozen floor amendments were debated and rejected.
Twenty-four votes would be needed in the 35-member Senate to reach the two-thirds threshold.
The tax relief package was designed to set government spending caps, increase school aid as a way to ease upward pressure on local property tax rates, and expand existing tax relief programs for homeowners and renters.
Central issues of dispute included the pace at which state aid to schools would rise and the possibility that property-tax break provisions would result in shifts of local tax burdens toward non-residential properties.
Some advocates of a swifter rate of increase in state school aid brought forth a separate measure that would seek voter approval to broaden and notch up the state sales tax as a way to raise more revenue. That proposal, however, went down to resounding defeat in the House, losing by 38-104. The Senate rejected it too, 21-13.
“We all want it done in two years,” said Sen. Bill Diamond, D-Windham. “But if it means raising a tax, some of us can’t do that.”
On Wednesday, the House had rejected 10 amendments before voting 89-53 in favor of the bill. To reach the two-thirds threshold in the 151-member House, advocates of the tax package needed 101 votes.
In addition to expansions of Maine’s so-called circuitbreaker and Homestead tax relief programs, the package envisions an increase in the state subsidy to public schools from a little over 40 percent to 55 percent over a four-year period.
Lawmakers spent much of the last two-year session of the Legislature focusing on state taxes and listening to expressions of discontent outside the State House. State voters approved an initiative backed by state educators and municipal officials last June that called for an immediate boost in state support for local schools but turned down another proposal in November that sought to cap property taxes at 1 percent of assessed value.
Numerous lawmakers have said they would favor boosting school aid at a faster pace than the tax package would provide, but many voiced concern over the cost.
“The state cannot afford to do this,” Democratic Sen. Margaret Rotundo of Lewiston said Thursday, warning against cuts in social services, only to hear Republican Sen. Richard Nass of Acton declare, “we can pay for this easily,” suggesting as one step that unfilled state positions could be trimmed.
Ranking House Republicans basically shrugged off the retroactive approach contained in the final tax package, but GOP floor leader David Bowles of Sanford sounded a little annoyed.
“There doesn’t appear to be anything about the action that’s not legal,” Bowles said. “The bottom line around here is he who has the majority makes the rules.”
Baldacci’s legal counsel, Kurt Adams, said inserting retroactive dates in legislation was not unusual.
“We do it in every single budget,” he said, in conforming state and federal tax provisions.
AP-ES-01-20-05 2036EST
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