The subject of property taxes has become increasingly prevalent in recent weeks, with discussions ranging from the repeal of the Property Tax Stabilization Program for Seniors to the increased property tax bills in many municipalities throughout the state.
Earlier this summer, the State Legislature defunded the Property Tax Stabilization Program less than a year after it was originally signed into law.
Originally enacted in August of 2022, the Legislature voted in July of this year on a spending bill that effectively repealed the program following complaints from municipalities across the state that the program would be unsustainable. The program allowed seniors to effectively freeze their property taxes.
Program benefits will now only be applicable for the property tax year beginning on April 1, 2023.
This, however, was not the only property tax relief program on the books in Maine. The two other statewide property tax relief programs — the Property Tax Fairness Credit and the State Property Tax Deferral Program — were expanded in the same legislation that repealed the program for seniors.
The Property Tax Fairness Credit is a credit applied to homeowners’ income tax returns. Should the amount of the credit exceed the amount of income tax owed, the taxpayer would receive the remaining balance as a refund.
The legislation repealing the Property Tax Stabilization Program increased the total amount of this benefit from $1,500 to $2,000.
The State Property Tax Deferral Program is a lifeline loan program that allows Mainers age 65 and older to cover their annual property tax bills. The total amount of the loan must be paid back either when the home is sold or it becomes part of an estate.
The income limit for this program was doubled to $80,000 and asset limits were raised.
Mainers of all ages, however, have been concerned about their property tax rates in recent months. Earlier this summer, Brunswick was poised to reevaluate residential properties for the first time since 2017. The move initially looked like it was going to hike rates for residential property owners while reducing rates for commercial owners.
In light of substantial backlash from Brunswick residents, however, the town decided to delay the move. Currently, property valuations in the town are sitting around 60 percent of their market value. In order to be legally compliant, valuations must fall between 70 percent and 110 percent of their market value.
Reporting from WGME suggests that the town was able to push back re-valuations by a year without facing any penalties.
This suggests that although Brunswick residents have averted a higher property tax burden for the time being, an increase is likely still coming in the near future.
That said, the state of the housing market at the time of the re-valuation plays a critical role in determining the degree to which home valuations rise.
Reporting from WGME revealed that many in Brunswick are hopeful that the housing market will cool off over the next year, in which case the updated valuations would not be as high as they would be if done now.
Mainers in Caribou are also facing an increased property tax bill. On average, property owners in Caribou can expect to pay 17 percent more in property taxes this year compared to last.
Unlike in Brunswick, it was determined that Caribou’s current property tax valuations were equal to 72 percent of properties’ market value — a percentage that is within the statutorily-defined limits.
Despite this, Caribou adjusted property valuations such that they are now able to “utilize 100 percent or greater the value of properties’ in the municipality.
According to reporting from WAGM, however, Caribou officials contend that the increased property tax revenue that will result from these changes will only be equal to the amount needed for the municipality to meet its budgetary obligations.
Properties in Bath have also recently undergone reevaluations, resulting in a 27 percent valuation increase compared to 2019. As in Caribou, the increased property valuations were used to determine the property taxes owed by residents this year.
In Bath, it is custom for properties to be taxed at roughly 100 percent of their market value, but due to the significant changes in the housing market since 2019, tax valuations in Bath were only equal to about 80 percent of their market value — something that municipal officials believed to be problematic, according to reporting from the Portland Press Herald.
Bath has, however, lowered the tax rate that is imposed upon these valuations. In other words, property owners are seeing the values of their properties increase but their tax rate decrease.
Consequently, the move will not increase the total amount of property tax revenue collected in Bath, but rather it will redistribute the collection of these taxes based on the updated property valuations.
These are only a few examples of Maine municipalities that have made, or considered making, adjustments to their property tax collection this year — including Westbrook, Bowdoinham, Portland, South Portland, Gorham, and Scarborough, to name a few.
In many of these cases, property tax increases were directly linked to increased municipal spending. Therefore, it remains to be seen whether these and other municipalities will continue to raise residents’ property taxes to cover rising expenditures or if officials will work to reign in their bottom line to minimize the tax burden that must be shouldered by residents in the future.
<span class="dsq-postid" data-dsqidentifier="21935 https://www.themainewire.com/?p=21935">10 Comments
What can we the tax payers do to rescind this governor’s rescinding of a program that was designed to assist those of us who have worked all of our lives only to now exist in a State where MS Mills focus is on persons whom she h ands out benefits 0 like M & M’ S to ensure her party remains in power. I will be 78 next month. I’m tired, discouraged by the lack of fair managerial decisions this governor keeps implementing.
This once great state is being run by idiots [democrats] who will constantly overspend what the collective revenues are and then turn around and try to raise taxes, this is why they are referred to as “tax and spend” democrats. The smarter way would be to look at the wasteful expenditures that are not part of the state’s constitution and ask why we have these expenditures now? Democrats voted in programs that spend taxpayer dollars where it never should have been for the start. Get rid of the democrats and elect officials who take the term ‘fiducial responsibility” seriously.
The property tax situation is spiraling out of control for seniors. Seniors have no control over the housing market or inflation as they are being financially squeezed from all sides. Local governments must take a hard look at budgets and cut anything that isn’t mission critical to providing citizens a safe, well maintained town with necessary services and facilities.
School budgets have to be evaluated. I’ve never understood how politicians have gotten away with just demanding more and more and more money from citizens instead of, like any regular person or business, making a budget in which expenses have to be less than income. People on fixed incomes are suffering. We are using up savings at an alarming rate just trying to keep our heads above water. What happens when there’s no money left on the money tree that politicians love to shake? I guess we’ll find out if nothing changes.
I live in Eastern Washington County and our property tax valuations have increased dramatically due to the influx of people from out of state buying property here, especially waterfront. So basically we are paying higher taxes because a few rich people from New York and California can afford to buy up property here. I don’t know how those living on Social Security can afford these taxes. We are already the poorest county in the state and about to get poorer.
A few thoughts on the subject from a Brunswick homeowner for 26 years.
This passage: “Caribou officials contend that the increased property tax revenue that will result from these changes will only be equal to the amount needed for the municipality to meet its budgetary obligations” uses the term “obligations” as if all town costs are “beyond our control.” That old nugget has been used in Brunswick as long as I have lived here. It is bogus. The vast majority of costs are ones they pre-approved when they let town properties fall into disrepair; grant raises and benefit increases in advance; and otherwise act as if they know they can force us to pay whatever it is they want. The few costs that are “beyond town control” are weather related and the like.
Next the Brunswick valuation conducted in 2017 was a full on knock on our doors and ask to come in level survey. It should have set valuations at 100% at that time, which from sales I had seen, is what they did. Claiming that values had increased by 2/3 in 6 years is ridiculous on it’s face, but sure enough, mine went up by exactly 66.7%.
The whole double number gimmick of valuation and tax rate is ripe for officials to hide behind no matter what ensues. “Sure, your valuation went up, but look how much the tax rate went down! (At the same time the town got a revenue windfall).” Have you ever seen valuations go down?
The system needs to be changed so the only figure of merit is how much our tax bill is for any given year; that’s the amount we have to cough up or lose our home. When we built our house, our first bill was $4300. Now it’s ~ $10,000 for exactly the same services (or less.)
What would we say if our State taxes had more than doubled, or the federal the same growth?
We’d be up in arms. But the Property Tax is the most insidious of all, because it is an adjustable rate tax. Don’t you wish you had an adjustable rate income, where each year you could demand whatever you need (or want) in the way of an increase, and it had to happen or someone would end up penalized.
So confirmed that one never really owns their house, car, boat or atv. We rent the privilege from almighty state. Eventually the elder cannot afford taxes on house so great state puts a lien…for good of children, theirs.
Thanks to Libby Palanza. She writes an intresting stories, however, only quoting WGME as a source is not why I read TMW.
All of us grow in talent & resources, but I continually am appreciative of Steve Robinson & his actual journalistic principles & of his team/staff, the direction that TMW tacks & recovery of local & state news reporting.
My property taxes doubled in bucksport
…doubled…
I called town, they had explanations and reasons.
Also, very sad to have house paid off an know the state can foreclose on the property with a lien on property taxes.
Car breaks, couple things go wrong, an prop taxes double, wonder where the cash will come from.
Old Town just did a reevaluation, the tax burden shifted from industrial/commercial properties to older residential properties that saw 50%+ increases in property valuations.. the mill rate went down form 21 to 17. when your property value increases 50-100k the increase is substantial. The good news the Old town budget did only increase by 3.8% but the burden to pay is shouldered on the lower end residential homes.
New property tax decision made by Maine Supreme Court on Oct 3, 2023. Search Oakes v. Town of Richmond. If towns & cities tax the “use of” property, does it not behoove you to find out what “use” is taxable? Is simply living and not generating income at home taxable? What do they presume you do at home?