YARMOUTH — A bill that would provide property tax abatements for homeowners whose residences have been destroyed hit a major setback last week when the Legislature’s Taxation Committee voted 8-3 not to pass the measure.
The bill, sponsored by Rep. Janice Cooper, D-Yarmouth, was inspired by last June’s propane explosion on Gables Drive, which displaced a half-dozen families.
Current law allows for abatements only in cases of poverty. The bill’s proponents would like to see it expanded to include people whose homes have lost more than 50 percent of their worth.
The Maine Municipal Association raised questions about the constitutionality of the bill and suggested the use of the term “benefit” instead of “abatement.”
Ultimately, though, it was a difference of opinion between Cooper and other lawmakers that defeated LD 1610, an act to allow a municipality to abate taxes assessed on property that is destroyed.
“It basically boiled down, not to the constitutional or legal issues the MMA raised, but that the senators on the committee just didn’t want to do it,” Cooper said. “They didn’t want to expand it beyond relief because of poverty, inability to pay.”
Cooper suggested municipalities account for potential lost revenues using overlay funds – money set aside for unpaid taxes, poverty abatements and other unforeseen gaps in revenue. State law permits towns to save up to 5 percent of expected revenues in an overlay fund, though many opt for much less. Cooper’s argument that towns could limit destroyed property abatements to a percentage of their overlay funds failed to gain traction.
The minority report that received three votes used much of Cooper’s original language, but contained one crucial difference: it would only allow abatements between the day property taxes are assessed, April 1, and the date of commitment – the day tax bills are mailed. That day varies from town to town; in Yarmouth, it typically falls in June or July. Regardless, that provision would drastically reduce the amount of assistance the bill could provide.
Even in that form, an endorsement of the bill may have been welcome news for the Yarmouth residents struggling to regain their footing in the wake of the 2013 tragedy that took one life.
Amory and Jean Houghton were among the explosion victims recently informed by an insurance company lawyer that the gas equipment removed from the Gables Drive condominiums was so severely destroyed that no fault can be determined.
“At the moment that avenue is closed to any relief for us,” Amory said last week in an email. “I guess at this point we all have to suck it up and simply accept that we are fortunate to be alive.”
Despite last week’s discouraging Taxation Committee work session, Cooper hasn’t given up hope of resurrecting her original bill. She said she would do whatever she could to try and bring it before the House.
“I’m going to bring the original bill up on the floor if I’m allowed and try to get an up and down vote on that,” she said. “But with three senators voting against me and several representatives, it continues to be an uphill battle.”