(UPDATED x4) Maine Mayors Warn of Revenue Sharing Cuts, Tax Increases and Impact on Communities

Posted on January 15, 2015. Filed under: Uncategorized | Tags: , , , , , , , , , , , , , , |

Auburn Mayor Jonathan Labonte addresses media at Maine Mayors' Coalition press conference, urging lawmakers reject Governor LePage's revenue sharing cuts as part of FY 14-15 budget proposal.

Auburn Mayor Jonathan Labonte addresses media at Maine Mayors’ Coalition press conference, urging lawmakers reject Governor LePage’s revenue sharing cuts as part of FY 14-15 budget proposal.

(Originally posted 11 Jun 2013) Last week a press conference was held at the State House’s Welcome Center where leaders from Portland, Lewiston, Auburn, Augusta, Gardiner, Waterville, Sanborn and Bangor addressed the media and voiced concerns regarding the impact Governor LePage’s proposed zero revenue sharing cuts will have on their communities. Dozens more municipalities across the state have sent resolutions and communications to the Legislature protesting the cuts.

Augusta Mayor Bill Stokes said, “Maine communities have already absorbed a 30% cut in revenue sharing. This year, we are receiving just under $98 million, instead of the $140 million we would have received by law. Now there are proposals to cut that by $20 million a year or more. That will mean a significant property tax increase in Augusta.”

Karen Heck, Waterville’s Mayor, has long been outspoken in her criticism of tax cuts and how those cuts affect municipalities, as was her predecessor, Paul LePage. She laid out a bleak picture:

“Even the best of these (Appropriations and Financial Affairs Committee) proposals means a loss of nearly 50% million to municipalities over the next two years. We have been cutting services and trimming payroll for several years. We simply cannot absorb that kind of cut without raising taxes. Revenue sharing is an obligation, a bill the state should pay.”

She had spoken up the previous evening at a Waterville city council meeting as well, blasting the Governor’s proposal:

heck waterville

“This is really a ridiculous position for all of us to be in,”

      Heck said of the man who was mayor of the city from 2004 until he became governor in 2010.

“When the governor was mayor, clearly he used some profane language to describe exactly what he’s doing to us in a much worse way.”

She continued: “I’m not sure why the governor is interested in making sure hospitals get paid. But the mayors feel that the state needs to pay its bills when it comes to what it’s mandated to pay us in revenue sharing.”

Gardiner Mayor Thom Harnett noted that “we have a revenue problem in Maine and we need to look at additional streams of revenue”:

“We are calling on all legislators to commit to preventing this tax shift to the property tax. As we recommended in a letter to the Governor last month, this tax shift can be prevented by some modest shifts to the sales tax. The Mayors Coalition is supportive of proposals that temporarily raise the sales tax to 6% and raise the lodging tax.”

Jonathan Labonte, Mayor of Auburn, who noted that his city has been working to share services with nearby Lewiston for some time now, added that “Eliminating revenue sharing would effectively undermine the state’s 40 year cooperative agreement with municipalities. These are the revenues that keep your property taxes from skyrocketing and help to pay for municipal services such as firefighters, schools and road maintenance.

Also speaking out were Cathy Conlow (VIDEO), Bangor’s city manager, Maura Herlihy of Sanford and Lewiston City Administrator Ed Barrett for Mayor Macdonald (VIDEO), who mentioned at length the expensive, multiple fires his city had recently endured:

Mayor of Portland Michael Brennan (VIDEO) concluded by asking, “all legislators to work to prevent a property tax increase in virtually every community in the state.”

(Bonus: Q&A clip)

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UPDATE #1: Originally posted in June 2013 and oh, what a difference a year made. In June 2014, Governor Paul LePage selected Auburn Mayor Jonathan Labonte to serve as Office of Policy and Management director, as outgoing head Richard Rosen had been tapped to temporarily take over at Department of Financial Services for the retiring Sawin Millett.

    The chance to serve the state of Maine and the governor was one he (LaBonte) couldn’t turn down, he said.

“When a governor calls and asks you join their team, that’s a unique opportunity,” LaBonte said.

LaBonte said he did not believe his appointment had anything to do with election-year politics.

“If there’s anything political about this, it is the governor was eager to see this office created and is looking to see works delivered out of it,” LaBonte said.

DAFS Commissioner Richard Rosen presents the LePage FY 2016/2017 biennual budget to AFA, 1/13/15.

DAFS Commissioner Richard Rosen presents the LePage FY 2016/2017 biennual budget to AFA, 1/13/15.

Yesterday, the LePage administration continued to roll out the governor’s proposed FY 2016/2017 biennial budget as now DAFS Commissioner Richard Rosen, deputy commissioner Dr. Michael Allen and Labonte sat down with Maine media, a day after Rosen presented the budget to the newly seated 127th Legislative Appropriations and Financial Affairs Committee. This jumps out:

      LaBonte, who also is the director of LePage’s office of policy management, said Wednesday during a briefing with reporters that fears the proposal would decimate municipal finances are overblown.

He said in 2008 revenue sharing only accounted for 5 percent of municipal budgets statewide and that the figure had decreased to 3.5 percent by 2012.

“So revenue sharing is not a large share of those municipal budgets and certainly not a large share of what’s going toward those expenditures,” LaBonte said.

When revenue sharing was first put in place, its intent was to provide property tax relief. Because the funding was directed to municipal government and did not go directly to property owners, they never ultimately benefited, LaBonte said.

On Friday, Governor LePage attempted to minimize the effects of municipal revenue sharing and the impact its removal will have on Maine’s 460 plus cities and towns.

So same as 2013 Governor Paul LePage thought 2009 Mayor LePage wrong* on municipal revenue sharing, apparently 2015 OPM Director/ LePage team player Jonathan Labonte seems to now think that 2013 Auburn Mayor Labonte was making a big deal out of nothing.

*RELATED: Video: Did 2009 Waterville Mayor Paul LePage Rip 2013 Governor LePage For Revenue Sharing Cuts To Towns, Education Funding Failures?

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UPDATE #2: OPM Director/ Auburn Mayor Labonte has responded via Twitter in an interesting exchange as well as Bangor city councilor Ben Sprague:

When the email is received, it will be shared here. ~AP

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UPDATE #3: The February 2013 email exchanges between Auburn Mayor Jonathan Labonte, members of the Maine Mayor Coalition and legal counsel were shared by Labonte moments ago:

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(2/16/15) As Labonte continues to see his own position as not inconsistent, this post is being updated below with more conversations via Twitter today.

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Governor LePage’s OPM Director Lays Out Nearly $34 Million Cuts To Balance State Budget

Posted on October 8, 2013. Filed under: Uncategorized | Tags: , , , , , , |

Director of Office of Policy and Management former state senator Richard Rosen (R-Bucksport)

Director of Office of Policy and Management former state senator Richard Rosen (R-Bucksport)

As part of the biennial FY ’14-15 budget bill enacted in June that called for the Governor’s newly formed Office of Policy and Management department with finding $33,750,000 in cuts, OPM Director Richard Rosen presented a 115 page report before Appropriations and Financial Affairs (AFA) last week. This is the first report by Rosen to the committee.

Among the cuts listed:

  • $1 million in the closure of the Maine Revenue Services’ Houlton office (Note: This closure has already occurred, resulting in 12 jobs lost).
  • $9.6 million in administrative expenses in cuts to education.
  • Nearly half a million dollars in HeadStart funding.
  • $1 million cut to vaccines for children and cuts to the state’s reimbursement to towns for General Assistance for struggling families.
  • $1 million in innovative technology investments at Maine Technology Institute.
  • Multiple Department of Corrections cuts/changes, including:
      -$1.1 million by reducing overtime.
      -$800k by cutting the Prisoner Boarding Account.
      -Allowing prisoners with 18 months left on their sentences, as opposed to current 12 months, to participate in work-release programs, creating an additional $85k in revenue.
      -Privatizing DOC’s kitchen staff, saving $374k.
  • Elimination of more than a dozen inactive state boards and commissions. Negligible savings.

    Here are some quick videos of Mr. Rosen addressing the committee, the first as he starts to lay out the cuts to the committee and the second including questions by AFA committee members:

    Democrats were critical of the cuts:

      “There are strong concerns that the administration’s proposed cuts will harm our state’s economy and Maine families,” said Senator Dawn Hill of York who also serves as the Senate chair of the Appropriations and Financial Affairs committee. “We are prepared to make hard decisions and know that we must work together on solutions. But these solutions must be strategic and smart, not harmful and regressive for our working families and our towns.”

      “This proposal is a ‘greatest hits’ list of rehashed ideas that have been rejected by both parties, It’s hard to believe this is a serious proposal.” said Rep. Peggy Rotundo, D-Lewiston, the House chair of the Appropriations committee. “Now it is our job to find proposals that work.”

    As required by the budget, $11 million of the proposed cuts would occur in fiscal year 2014 and do not require the approval of the Legislature. The remainder of the proposed cuts would occur in 2015 and would need to be approved by lawmakers when the Legislature reconvenes in January.

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