Maine lawmakers discuss property tax relief amid opposition

Maine lawmakers are discussing ways to provide property tax relief due to rising taxes resulting from inflation and a booming real estate market. This issue has gained attention since last year, when a program to freeze property taxes for seniors was repealed because it was too costly. Voters expressed their concerns about property tax increases during the fall elections. In response, lawmakers are evaluating several proposals, including freezing property taxes for seniors again and expanding the homestead exemption. However, these measures face opposition from Governor Janet Mills, who argues they could be too expensive and not beneficial for renters. Recently, the Taxation Committee held hearings on multiple property tax relief bills. The Mills administration prefers to enhance existing tax credit programs, which help seniors and low-income homeowners. Maine's associate commissioner of tax policy, Mike Allen, believes these programs are more cost-effective and provide targeted relief. The previous senior property tax stabilization program was popular but strained finances, leading to its repeal. It allowed seniors to pay fixed tax amounts regardless of changes in their homes. Cost estimates for the program surged, with a rise from $21 million to $46 million, prompting its replacement with enhanced tax relief measures. New proposals include expanding the homestead property tax exemption, raising the cap from $25,000 to higher amounts. Some lawmakers are pushing for significant increases, but municipal leaders are concerned these changes could lead to decreased revenue or higher taxes for other property owners. In addition to expanding exemptions, some lawmakers are proposing local option sales taxes to offset lost property tax revenue. However, there are concerns that such taxes could unfairly burden some communities while benefiting larger cities. All proposed bills will be further debated, with some lawmakers stressing the need for meaningful tax reform.