Maine citizens are already overtaxed and demanding relief. This is no time to consider adding a new local option sales tax at the county level, especially since there’s talk of dismantling county government altogether. And most especially since that tax revenue might be used to fund private projects.

A blue ribbon commission formed to look at the use and life of the existing Cumberland County Civic Center has concluded that a new, larger civic center would best be built on Congress Street with hefty public financing. Specifically, the commission recommends giving each county the authority to levy a 1 percent tax on meals and lodging, a local option tax that could easily buy a new civic center.

The Cumberland County Civic Center is outdated and too small to regularly draw premium performers or to keep the Portland Pirates interested in staying so it’s understandable to consider a new 8,500 seat facility in downtown Portland. The blue ribbon panel estimates the arena will cost as much as $60 million to build, with $4.5 million annual payments.

A 1 percent tax increase on meals and lodging in Cumberland County would be enough to make those payments and earn another $1.5 million for as yet undesignated county expenses each year. If other counties exercise the option to increase the sales tax, earnings could be in the millions.

The idea of taxing meals and lodging is popular because as much as 30 percent of these purchases are made by out-of-staters. While it’s good to have tourists help pay our bills, that leaves the remaining 70 percent of this new tax paid by Mainers, the very people looking for tax relief.

And, if this new tax works so well it could become a permanent funding mechanism for expensive projects – public and private. Where would it end?

The blue ribbon commission’s recommendation for this sales tax increase was made just last week with a matching recommendation for the governor to include it in his tax reform package due out this week. That’s pretty quick and, while individual tourists probably won’t object, it leaves little time to really figure out what the added tax might do to discourage convention bookings or cool Mainers’ desire to dine out or vacation in-state. Especially if the Cumberland County Civic Center project prompts the first of multiple local option tax increases.

Building a new civic center is certainly a worthy project, one that could increase the Portland arena’s annual cash flow by as much as $800,000, but only if citizens and tourists repay construction loans. Sounds like an ideal situation for the arena, one that any private developer would be eager to share. And that’s the problem. Asking taxpayers to fund private projects, even if the economic development potential is great, must be a sparing request, especially now when private borrowers have access to such favorable interest rates.

Cumberland County doesn’t have to increase the sales tax to build a new civic center. It could seek private investors and/or levy a surcharge on each of the hundreds of thousands of hockey and concert tickets sold each year, asking civic center guests to fund a replacement arena instead of turning to taxpayers who have already said they can’t afford to pay another tax.


Related Stories
Latest Articles