Gov. Janet Mills (D) has signed into law a bill allocating more than $15 million to reimburse municipalities for the cost associated with the short-lived Property Tax Stabilization for Senior Citizens program.
After the appropriation was unanimously approved in committee, both chambers of the legislature voted without a roll call in favor of moving the measure forward.
The Senate voted in favor of finalizing the bill’s passage without a roll call, and the House unanimously voted in a roll call to send the legislation on to the governor for a signature.
Gov. Mills signed the bill into law on Wednesday, March 6.
LD 646 — sponsored by Rep. Melanie F. Sachs (D-Freeport) — was originally a “placeholder” concept draft carried over from the first legislative session.
In early February, the Appropriations and Financial Affairs (AFA) Committee unanimously accepted an amendment adding substance to the bill and re-titling it to “An Act to Fully Reimburse Municipalities for Lost Revenue Under the Property Tax Stabilization for Senior Citizens Program.”
Under this amendment, the emergency bill sets aside $15 million from the unappropriated General Fund surplus to cover the cost of required municipal reimbursements for lost property tax revenue associated with the stabilization program.
It also designates an additional $50,000 for the “implementation and administrative” costs associated with the Stabilization Program’s establishment.
Click Here to Read the Full Text of LD 646
The Property Tax Stabilization for Senior Citizens program — originally passed in August of 2022 — was repealed by lawmakers last summer and was only be applicable to the property tax year that began on April 1, 2023.
Intended to stabilize property tax bills for full-time Mainers age 65 and older, the program was expected to cost state taxpayers millions annually, increasing substantially with each passing year.
Although municipalities were to be fully reimbursed for revenue lost as a result of this program, critics pointed out that the design simply shifted costs from municipalities to taxpayers statewide.
The fiscal note attached to the final version of the Stabilization Program indicated that roughly $2 million was initially allocated from the General Fund to cover the cost of municipal reimbursements for fiscal year 2023-24.
Based on the claims made in the emergency preamble to the bill, “certain municipalities have not been fully reimbursed for lost revenue resulting from underfunding of the property tax stabilization program.”
In her testimony introducing the bill, Rep. Sachs explained that the costs associated with the now-defunct Stabilization Program are “double what was estimated,” and consequently, current appropriations have “only met 56 percent of the actual cost.”
“Municipalities were sent notices that they would be reimbursed the rest if and when the supplemental budget was enacted,” Sachs said. “I am committed to meeting 100 percent of our financial obligations under this current program to our municipalities right now.”
Click Here to Read Rep. Sachs’ Full Testimony
Because this bill was classified as an emergency piece of legislation, the law took effect as soon as it was signed by the governor.
The $15 million appropriation must be transferred in March, and the $50,000 portion of the funds must be transferred by June 30 of this year.
How about doing what NH does, no school taxes after 65. The difference will be made up by the parents of the kids using the schools but will be refunded by the child tax credit that is already in place so no extra programs or funds will be needed.
I like the idea of not having to pay the school tax portion of my land tax, which is at least 75% of my land tax bill. Not sure such an animal will ever pass in the now socialist/democrat run State of Maine.
This whole idea was a pre-election gimmick by Mills and crew to hype her “caring about seniors,” knowing full well that they would rescind it after she won.
$15 million is short change for a state that now spends $10 Billion in the biennium. Besides, towns just jack up the mil rate to provide whatever revenue they want. That’s the way they have always operated, and always will.
This was, as always, a hoax, with the added appeal of a bait and switch.