I love Yarmouth as a community and Maine as the greatest state in the country. And, I’m sure that residents and community leaders throughout our state feel the same way about their towns and cities.
But, in my opinion, local municipalities are under attack. Not from the outside, but from within. And unless we speak up, with voices loud and clear, fiscal budget decisions made in Augusta over the next few weeks threaten our immediate interests, with the potential to greatly cripple our collective futures.
Gov. Paul LePage recently submitted his 2014-2015 biennium budget to the Legislature. His $6.2 billion two-year budget proposal is unprecedented in ways that go far beyond fiscal management, into the realm of recasting the constitutional relationship between the state and its municipalities.
The budget hierarchy between federal, state, county and local municipalities has always been part of our system of government. The core principle of that revenue collection/expense budgeting approach is that each government entity collects an approximate amount relative to the services being provided, and the oversight and infrastructure commanded.
LePage’s budget proposal wildly overreaches in the revenue burden that he is attempting to shift to municipalities across the state.
Reducing state income taxes while shifting significant cost burdens to local towns through various mechanisms (homestead exemption change, revenue sharing, teacher retirement funding, excise tax, etc.), is bad policy, weak fiscal management, and fundamentally dishonest as an approach to meeting our challenges. It also shifts a higher revenue burden onto property taxes, which is regressive tax policy by nature.
In addition, the LePage proposal to take $14 million in casino funds earmarked for public education, and transfer those funds into the state General Fund, represents more than a broken promise to Maine’s voters; it’s a horrible precedent to directly link casino revenue to our state budget. Such dependency over time will only lead to regulatory issues, budget variances, and an unhealthy co-dependency between the gaming industry and the state.
Two years ago, LePage personally touted tax cuts and a lack of gimmicks as features of his first budget as governor. In his current proposed budget, he is effectively demanding enormous “tax burdens” shifted to local towns and cities with numerous gimmicks to abdicate portions of our state’s responsibilities (education, health services, public safety, etc.).
Aside from LePage’ s breathtaking budgetary policy zigzag in just two years, I’m more concerned about the immediate crisis at hand that threatens virtually every person in Maine. The proposed budget goes far beyond the scope of a responsible recalibration of state and municipal revenues and expenses; it attempts to fundamentally change, now and forever, the financial and constitutional relationship between Maine and each municipality.
Maine’s bond rating was reduced by one agency last week, with the “contentious” atmosphere in Augusta being cited as one factor. The New York Times ran an article last week suggesting that Maine’s political standoff between the governor and lawmakers could lead to a government shutdown.
As the leader of a municipality, and as a citizen of Maine, I’m asking the governor to reconsider his budget proposal.
In addition, I am asking that the Maine Municipal Association, the organization that represents the state’s towns and cities, to formally ask all municipalities to vote individually on a shared resolution that demands a 2014-2015 budget that is fair and equitable between the needs of the state and the needs of local municipalities.
Based upon input from fellow town councilors and residents of Yarmouth, I intend to support such a resolution as soon as possible.
Steve Woods is chairman of the Yarmouth Town Council, CEO of Falmouth-based TideSmart Global, and an announced Democratic candidate for governor in 2014.