Town Of Cape Elizabeth
Cape Elizabeth News

Palesky Tax Cap Task Force

In April 2004, a citizen task force began meeting to assess the impact passage of 1-percent property tax cap initiative, up for election Nov. 2, would have on the Cape Elizabeth town budget.

A complete notebook on Tax Cap Task Force proceedings, findings and recommendations is available at the Thomas Memorial Library, 6 Scott Dyer Road.

Below are links to key documents in the Task Force's report, as well as links to other informational documents.


Task Force Documents

Other documents:

Complete copy of Palesky Tax Cap Proposal:

Additional websites:


Town of Cape Elizabeth
Palesky Tax Cap Task Force
Executive Summary

September 1, 2004

Introduction

In April 2004, then Cape Elizabeth Town Council Chairman Mary Ann Lynch invited 56 citizens of the community to participate in a task force to study the impact of the citizen initiative on the November 2004 ballot that would limit property taxes to 1% of value and create other limits upon the right of local communities to assess taxes. 21 citizens and most of the elected members of the town council and school board participated in 9 subsequent meetings of the task force. In addition, subcommittees were formed and met to review a communications strategy and potential fees which would permit some services to continue.

Overall Financial Impact on Cape Elizabeth

The task force reviewed financial projections and determined that nearly $4.6 million dollars would need to be reduced from current budgets to meet the restraints of the tax cap. This amount would double if the Maine Supreme Court rules that valuations are to be returned to 1996-1997 values as is proposed in the actual ballot question. For planning purposes, the task force decided to use the lower amount as a narrowly decided advisory opinion from the Maine Supreme Court provided guidance that the court would rule that returning to the 1996-1997 values is unconstitutional.

The $4.6 million reduction in income from the property tax could be addressed in several ways. First, the tax cap task force recognizes that reductions will need to be made in spending in nearly all service areas. Second, the group believes that non-property tax revenues may be adjusted to provide additional income to the town. Third, the task force recognizes that some revenue may be forthcoming as a result of the June 2004 citizen vote to direct the state to provide 55% of statewide educational costs. With no action of the Maine Legislature since the June vote, the task force was unwilling to predict any specific income amount to Cape Elizabeth.

For planning purposes, the tax cap task force used as a guideline that Cape Elizabeth schools would suffer 68% of any loss and the municipal government would suffer 32%. The Cumberland County assessment may not be reduced. The Community Services program would need to move to a self supporting basis. If the tax cap is adopted, the exact cuts would be determined through the annual budget process.

Loss of Local Control

In addition to the direct fiscal and service impacts, the tax cap task force recognized that the tax cap initiative is a statewide vote. Unlike other states, there is not an opportunity for any local override. With the many mandates from the state and federal governments that remain for services, the ability to locally make decisions would be severely impacted.

Impact on Municipal Services

The impact on the municipal budget is approximately $1.5 million. The task force reviewed impacts prepared by staff including:

  • A 33% reduction in police services with resulting impeded responses to rescues and to other incidents

  • A 33% reduction in public works services with slower snow storm response, slower drainage issue response and no fall clean up week.

  • Closure of the Thomas Memorial Library for 50% of its hours

  • Closure of the Community Pool

  • Elimination of 90% of Street Lights

  • Elimination of funding for water rescues

  • 80% reduction in animal control services

  • Elimination of the planner, assessor, and the police community liaison positions.

  • Elimination of facilities manager position with resulting maintenance challenges

  • Elimination of the only full time fire department position

  • Reduction in town office hours and administrative support

  • Elimination of funding for human services needs

  • Reduced maintenance of field and community property

  • A total of 17 full time positions would be eliminated and another $600,000 would need to be cut

Impact on School Services

The impact on the school budget is approximately $3.0 million. The task force received a report from the departing superintendent of schools indicating that 24.5 teachers, 14.5 additional professional staff and 20.5 support staff positions would need to be eliminated. The school staff also indicated that with required mandates, the ability to actually make cuts is restricted. Among the specific changes discussed by the task force in part based on the superintendent's report were:

  • Larger class sizes

  • Elimination of all co-curricular positions including coaches and program advisors

  • The elimination or substantial reduction of funding for school sports/athletics.

  • Elimination of music, art and other allied arts positions

  • Reduced maintenance of school facilities

  • Elimination of curriculum planning position

  • Reduction of supplies and equipment

  • School day to be reduced by one hour

  • Elimination of other administrative and support positions

Revenues Other than the Property Tax

Subcommittees considered the potential of meeting some expenses through the use of fees. Among the fees suggested for consideration were:

  • Pay per bag fee at the Recycling Center

  • Fort Williams Park admission fee

  • Increased building permit fees

  • Fees to participate in school sports up to $900 per player per season

  • Fees to participate in school dramas and speech and debate fees

  • Higher parking fees and fines

  • A 25% increase in all community services fees

  • A 25-35% increase in all pool and fitness center fees in order to try to keep the pool open

It was suggested that the community services fees pay all operating expenses and debt service fees for the community center and for the community services programs. Pool and fitness center fees pay all operating expenses. Sports and co-curricular fees pay all operating expense for these programs. The pay per bag and other disposal fees cover all costs of the recycling center and the Fort Williams fees pay for all expenses related to Fort Williams Park. These fees could aggregate to over $1.5 million and would not be tax deductible.

Communication Strategy

The task force decided that information should be provided to citizens on the potential impacts of passage of the tax cap initiative. A "Question and Answer" format two page summary of the ballot measure and its impacts on citizens was prepared and is being circulated through the Cape Courier. A number of "op-ed" articles and letters were also encouraged to be written to local newspapers. Every meeting of the task force was open to the public and to the press. Local newspapers covered and reported on every meeting. It was also agreed that the town's web page should include information on potential impacts and a notebook should be available at the Thomas Memorial Library with all information reviewed by the task force.

Conclusion

The tax cap task force agreed that passage of the ballot measure would have significant impacts on the citizens of Cape Elizabeth. The impacts will include lower property taxes, reduced services and the potential of increased fees and new user fees. We believe that citizens should receive information from the town as prepared by the tax cap task force showing the impacts. We do not believe that it is our role as a task force to urge citizens how to vote on the ballot measure.

The task force process was an open process and every member enjoyed the opportunity to meet with other members and with staff to discuss diverse views on taxation and service issues. We appreciate the opportunity to have served on the task force and we thank our committee leadership, Co-Chairs Seth Brewster, Steve Simonds and Mary Townsend and the municipal and school staff who assisted us with material and questions throughout our process.

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Minutes of the Palesky Tax Cap Task Force meetings

PDF format  (Adobe's Acrobat Reader required ) RTF fomat (view in your word processor)
August 31, 2004 August 31, 2004
August 24, 2004 August 24, 2004
August 3, 2004 August 3, 2004
July 6, 2004 July 6, 2004
June 24, 2004 June 24, 2004
June 10, 2004 June 10, 2004