AUGUSTA — In a pre-emptive political salvo, the Maine Democratic Party warned Mainers Tuesday to listen carefully to Republican Gov. Paul LePage’s State of the State Address later tonight, saying LePage’s agenda will only hurt the state’s middle class.
In a release to media early Tuesday, Democrats attacked LePage’s proposal to cut the state’s income tax and broaden its sales tax, while eliminating state revenue sharing with municipalities and instead requiring them to apply property taxes to nonprofits.
“His plan to eliminate revenue sharing will hit rural communities the hardest, forcing them to either raise property taxes or cut funding for schools, snowplows and public safety,” the release, issued by Rachel Irwin, the party’s communications director, stated.
Irwin’s memo notes that some nonprofit leaders have said LePage’s plan to tax their organizations will lead to job losses in a sector that employs 85,000 Maine residents earning more than $3.6 billion in wages.
“LePage’s income tax cuts will benefit the wealthy and out-of-state corporations,” the release stated. “In his proposal, a worker earning $250,000 a year will get a better tax rate than a worker making $50,000 a year.”
Maine Democratic Party Chairman Phil Bartlett said he hoped Mainers would see the difference between what LePage offers in his budget plan and what Democrats believe are the priorities for Maine.
“The governor’s emphasis seems to be providing income tax cuts to people of the greatest means,” Bartlett said. “The Democratic Party is focused on really figuring out how to grow the middle class and create jobs for people all across the state.”
Bartlett said LePage’s singular focus was on “growing income inequality.”
He added the changes to revenue sharing would also force more cost on local property taxpayers while undermining investments to public infrastructure and education.
Bartlett said the plan to eliminate revenue sharing and replace it with a property tax on nonprofits would be of little help to some 300 Maine municipalities that do not have an eligible nonprofit to tax.
“Shifting taxes to the municipal level and forcing people’s property taxes to go up is just not going to be acceptable,” Bartlett said. “The combination of reducing spending and flat-funding portions of education and eliminating revenue sharing would be absolutely devastating to rural communities in this state.”
LePage’s spokeswoman, Adrienne Bennett, did not respond to a request for comment Tuesday, but Jason Savage, the executive director of the Maine GOP, said Democrats were leaning on, “… the same tired talking points about property tax hikes which have been shown to be false for more than two years.”
Savage said Democrats were sounding false alarms about LePage’s proposal and he noted several publications, including some in Maine, had suggested the governor’s proposal had the potential for positive impact for all Maine residents.
“Property taxes are a local decision and the LePage administration has clearly stated they want to hear good ideas and help local municipal governments save funds to prevent property taxes,” Savage wrote in a message to the Sun Journal. “Local leaders just need to start those conversations and work with the administration.”
Savage also noted that revenue sharing for cities and towns comprises only 3 percent of municipal budgets overall.
He said Democrats were also ignoring key nuances in LePage’s proposal, including sales tax credits for the lowest income families, a growing state income tax exemption for the lowest paid workers, and a big expansion of the state’s homestead exemption program for households with a resident 65 or older.
Savage said the concern over taxing nonprofits was also a new one for Democrats.
“This may be the first time Democrats have ever issued this talking point,” Savage said. “Over the past decades, and even recently, their proposals and rhetoric supporting tax hikes on Maine businesses have been supported by claims that tax hikes don’t negatively impact jobs in the private sector.”
LePage is expected to deliver his State of the State Address at 7 p.m. tonight before a joint session of the Maine House and Senate. The Sun Journal will livestream the address at www.sunjournal.com
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