Governor Details His Property Tax Freeze Resolution

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Lenny
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Governor Details His Property Tax Freeze Resolution

January 19, 2007
Governor's Office

AUGUSTA- Governor Baldacci today detailed his proposal to provide tax relief to Maine permanent resident taxpayers. The Resolution, L.D. 276, which has a tri-partisan support in the Legislature, freezes the valuation of Maine primary residences by amending the Maine Constitution. ]

"The time has come to enact a property tax relief policy that is by Maine people for Maine people," said Governor Baldacci, echoing his Inauguration promise. "Freezing valuations will provide permanent relief for permanent residents."

The constitutional amendment is modeled after the existing provision in the Maine Constitution - known as the Tree Growth Law - that gives a valuation break to woodlands, farmlands, wildlife management lands, open space, and working waterfront land.

"If we can freeze valuations in these cases, certainly we can do the same to protect primary Maine residents from escalating land prices," said the Governor. "There's a difference, however, in my proposal: The Tree Growth Law is voluntary. For primary Maine residents, I want to require valuation freezes across the board. This is about guaranteed relief."

Governor Baldacci's proposal puts in the Constitution the principle that valuations of primary resident lands are treated differently. It provides for a 5-year look-back recapture of forgone taxes when the property is transferred.

Once the resolution is ratified by the people of Maine, the proposal tasks the Legislature with creating implementing legislation.

"I know of the opposition to this proposal. But I'm certain we need to do more for Maine residents," said the Governor. "We've helped businesses by repealing the business equipment tax. We can export more of our property tax burden to second-home owners who aren't residents. I appreciate all the work that's gone into this in previous Legislatures, but I'm asking them to tackle it again."

The Governor's resolution is part of his vision to provide property tax relief to Maine residents. With the Governor's proposed biennial budget, the State will have fulfilled the promise of state spending on local education to 55%. His proposed budget restructures school districts, providing tax savings to all who pay property taxes in Maine. Governor Baldacci is insisting that the savings available from increased funding be directly passed on to taxpayers for immediate property tax relief.

As Chairs of the Taxation Committee, L.D. 276 is sponsored by Senator Joseph Perry; Representative John Piotti is the lead cosponsor. Additional cosponsors include Senator John Courtney; Representative Patsy Crockett; Representative Leila Percy; and Representative Dick Woodbury.

David Hughes
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Governor Details His Property Tax Freeze Resolution

[quote]
For primary Maine residents, I want to require valuation freezes across the board. This is about guaranteed relief.”
[/quote]

By making it none voluntary it guarantees that there will be no property tax relief in rural areas - read that as northern Maine outside of service center areas and any area in southern Maine that isn't experience hella good growth.

Why do I smell a trap that that GOP will rise to? What's the timeline on this? Approved next year and on the '08 November ballot?

GOP, go forth carefully on this one. Ducks in a row before talking on the record.

leftout
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Governor Details His Property Tax Freeze Resolution

David, next to you get our boys ear just ask him what is to stop munincipalities from just climbing the mill rate to compensate for his freeze.

Town Manager
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Governor Details His Property Tax Freeze Resolution

All this proposal will do is shift the burden onto non residential property AND it will lead to increase administrative costs at the local level.

Bob Stone
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Governor Details His Property Tax Freeze Resolution

And have a negative impact on the real estate market.

Bob Stone
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Governor Details His Property Tax Freeze Resolution

The average person keeps their mortgage a little over 4 years. With the 5 year look back, show me where the tax relief is?

Cash
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Governor Details His Property Tax Freeze Resolution

This will destroy the residential real estate market and lower home values at resale. If the Maine Realtors aren't screaming bloody murder about this, it's only because they haven't thought it through carefully enough.

Stavros Mendros
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Governor Details His Property Tax Freeze Resolution

The fact is that people are buying houses at high costs and upping the valuation for homeowners in nearby neighborhoods, especially in coastal communites. The Governor's idea had flaws, but it does address that problem.

Anonymous
Governor Details His Property Tax Freeze Resolution

I'm confused. Can the state Constitution really be amended simply by passing a bill? Doesn't it take some sort of super-majority, at least?

I'm also not at all clear on the five-year lok back to recapture lost revanue. Recapture from whom, the buyer, or the seller?

And, as mentioned, this really means nothing. The town has to pay it's bills somehow. If valuations are low, mill rates go up. This is a total paper tiger.

Stavros Mendros
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Governor Details His Property Tax Freeze Resolution

2/3 vote of both bodies and then a majority vote of the people.

Steven Scharf
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Governor Details His Property Tax Freeze Resolution

We need to just find 12 senators to stop this stupid idea.

Lets start a pledge list. Get one from your Senator.

Steven Scharf
SCSMedia@aol.com

Editor
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Governor Details His Property Tax Freeze Resolution

Tuesday, January 15, 2008

Taxation (287-1552)
1:00 PM Room 127, State House
 
L.D. 276      WORK SESSION:  RESOLUTION, Proposing an Amendment to the Constitution of Maine To Require the Legislature To Freeze the Valuation of Maine Primary Residence Land (Sponsor: Sen. PERRY of Penobscot) (GOVERNOR'S BILL)

Bill Status
http://janus.state.me.us/legis/LawMakerWeb/summary.asp?ID=280022666

Sponsored By:
Senator PERRY of Penobscot

Cosponsored By:
Senator COURTNEY of York
Representative CROCKETT of Augusta
Representative PERCY of Phippsburg
Representative PIOTTI of Unity
Representative WOODBURY of Yarmouth

SUMMARY

[i]“Do you favor amending the Constitution of Maine to require the Legislature to provide for freezing the valuation of primary residence land?”[/i]

This resolution proposes a constitutional amendment to require the Legislature to provide for freezing the valuation of primary residence land. As with existing constitutional provisions concerning current use valuation of farms, open space, forestland and waterfront land used for commercial fishing, the resolution proposes payment of a penalty for certain transfers of the primary residence land.

ewv
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Governor Details His Property Tax Freeze Resolution

[quote]We can export more of our property tax burden to second-home owners who aren’t residents. [/quote]
Here we go again, more of his demagoguery attacking non-residents in the guise of "tax relief" - while pretending that only non-residents would be hit with the tax shift. All the man knows how to do is shift taxes while lying about "tax relief".

Editor
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Governor Details His Property Tax Freeze Resolution

ewv -

My property taxes, my valuation, I believe, are a mix of the estimated value of my a) house and b) land. With a freeze on the value of primary residence [i]land[/i] - what's likely to happen to the value of [i]homes[/i] on that land?

Thank you.

skf

democrat
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Governor Details His Property Tax Freeze Resolution

And what about the taxes on businesses. This could simply shift taxes to the business community - another fine signal to anyone contemplating starting a business in Maine.

ewv
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Governor Details His Property Tax Freeze Resolution

[quote="Editor"]ewv -

My property taxes, my valuation, I believe, are a mix of the estimated value of my a) house and b) land. [/quote]
Yes.
[quote]With a freeze on the value of primary residence [i]land[/i] - what's likely to happen to the value of [i]homes[/i] on that land?

Thank you.

skf[/quote]
If that is what he is doing, it will shift taxes onto those with higher valued homes to make up for the frozen taxes on land. A freeze on land taxes by itself would shift the taxes onto homes, so above average homes would be hit harder. This is in addition to higher taxes on businesses and non-residents, so the taxes on higher valued homes is relatively higher but not necessarily taxed higher than now, depending on the net effect of all the shifts. Anything that makes homes more expensive to own makes them less valuable on the market than they otherwise would be. But there are all kinds of other effects, too -- like what happens to the values of [i]any[/i] homes when businesses and non-residents are taxed off their property? Exact economic predictions of the effect on home values is difficult or impossible without at least knowing the kinds of actual property and owners in the town. The main point is look at the Governor trying to screw people again with tax shifts dishonestly in the name of tax relief. He counts on people not realizing that a complex tax shift is in the works and the victims not knowing it until it is too late. It's more of the progressive left in action, which always hurts the economy as well as their intended victims.

J. McKane
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Governor Details His Property Tax Freeze Resolution

All property taxes should be capped - not just homes and not just their valuations.

ewv
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Governor Details His Property Tax Freeze Resolution

[quote="J. McKane"]All property taxes should be capped - not just homes and not just their valuations.[/quote]
But that would be tax relief, which August [i]does not want[/i]. All of these tax shift schemes are intended to keep total taxes and spending up while shafting a minority in order to placate enough voters to keep the game going.

JIMV
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Governor Details His Property Tax Freeze Resolution

[quote="David Hughes"][quote]
For primary Maine residents, I want to require valuation freezes across the board. This is about guaranteed relief.”
[/quote]

By making it none voluntary it guarantees that there will be no property tax relief in rural areas - read that as northern Maine outside of service center areas and any area in southern Maine that isn't experience hella good growth.

Why do I smell a trap that that GOP will rise to? What's the timeline on this? Approved next year and on the '08 November ballot?

GOP, go forth carefully on this one. Ducks in a row before talking on the record.[/quote]

The recapture provision is spooky. If one is in an area where your property values are moving, the state/government gets a good bit of extra cash when a place is sold.

JIMV
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Governor Details His Property Tax Freeze Resolution

[quote="Stavros Mendros"]The fact is that people are buying houses at high costs and upping the valuation for homeowners in nearby neighborhoods, especially in coastal communites. The Governor's idea had flaws, but it does address that problem.[/quote]

Agreed, the wealth of ones neighbor should not be the basis of ones tax.

JIMV
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Governor Details His Property Tax Freeze Resolution

[quote]And, as mentioned, this really means nothing. The town has to pay it's bills somehow. If valuations are low, mill rates go up. This is a total paper tiger.[/quote]

Not really as it stops the local government from gouging property owners for the wealth of their neighbors and stops the tax out of home problem that the locals could care less about. The local town may continue to overspend but they will not do so on the back of local property owners.

J. McKane
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Governor Details His Property Tax Freeze Resolution

[quote="JIMV"]
The recapture provision is spooky. If one is in an area where your property values are moving, the state/government gets a good bit of extra cash when a place is sold.[/quote] That alone completely destroys whatever small benefits a freeze like this might have had.

J. McKane
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Governor Details His Property Tax Freeze Resolution

[quote="Stavros Mendros"]The fact is that people are buying houses at high costs and upping the valuation for homeowners in nearby neighborhoods, especially in coastal communites. The Governor's idea had flaws, but it does address that problem.[/quote]
No it doesn't, not if you have to pay it all back when you sell.

J. McKane
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Governor Details His Property Tax Freeze Resolution

[quote="JIMV"] The local town may continue to overspend but they will not do so on the back of local property owners.[/quote] But they will do it on the backs of business property, vacant lots, anything they don't consider "homestead" property.

...---...
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Governor Details His Property Tax Freeze Resolution

Huge trap for Republicans.
Vote against this and you'll be
branded as voting against "real" tax relief
vote for it and you're voting for a questionable possible P.O.S. bill

JIMV
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Governor Details His Property Tax Freeze Resolution

[quote="J. McKane"][quote="Stavros Mendros"]The fact is that people are buying houses at high costs and upping the valuation for homeowners in nearby neighborhoods, especially in coastal communites. The Governor's idea had flaws, but it does address that problem.[/quote]
No it doesn't, not if you have to pay it all back when you sell.[/quote]

I paid over $30K in property taxes in 10 years in Portland. If my tax had been capped when I bought, I would have paid less than 1/2 of that. The last 5 years worth (the amount of difference between my fixed rate and the last tax base when we sold) would have been about $9K so I would have come out over $11K ahead. If I hadn't had to sell to flee to keep from having my property tax double again in the next 10 years, I would probably still be back in Portland....

I fled government greed. This might help folk who love the state but hate the government greed.

Town Manager
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Governor Details His Property Tax Freeze Resolution

Thank you for bringing up the old thread on this. A year more with AMG and my thinking has changed. Are you happy Naran? A year ago I was negative. Today, I say, let the people of Maine decide! Do I think it will pass? No. Do I think it is the right way to go? No. Do I think it will pass? No again!

Dan Billings
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Governor Details His Property Tax Freeze Resolution

We can always count on TM to reach the wrong conclusion.

He gets his tax revenue in any case. This proposal just shifts the burden.

Editor
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Governor Details His Property Tax Freeze Resolution

This is a huge trap for R's only if they sit on their...hands...and don't plan/think through alternatives. This train's coming down the track. R's know that. What are the respective caucuses going to do about it? Plan ahead or cave in?

skf

Dan Billings
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Governor Details His Property Tax Freeze Resolution

Many Dems don't like this bill so it may never come to a roll call.

They also don't want this on the ballot in an election year.

Town Manager
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Governor Details His Property Tax Freeze Resolution

[quote="Dan Billings"]We can always count on TM to reach the wrong conclusion.

He gets his tax revenue in any case. This proposal just shifts the burden.[/quote]

You are right Dan. The taxes will still have to be paid and the proposal does shift the burden. (I suggest you read my post from last year). But after more of a year of reading your BS I have decided that this proposal should be decided by the voters of Maine, (it will require a constitutional amendment) who know what's best....right Dan?

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