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The Orono town council heard multiple statements from its town manager and legislative representative Monday, Oct. 19 on TABOR II. Both consider it a bad idea for Maine, as well as for Orono and the state’s higher education system — including the University of Maine.
During the meeting, the town council voted unanimously to oppose TABOR II, as well as Question 2, concerning the excise tax, which Town Manager Catherine Conlow and Rep. Jim Martin, D-Orono, criticized for its effect on the state and town.
“TABOR is a whole new bag of worms that is brought in from out of state. It was developed in a conservative think tank in this country … and 26 states in the United States have all faced TABOR questions on the ballot, and 25 of them have rejected them,” Martin said.
Martin said the measure could negatively affect higher education in Maine, as it did in Colorado — the only state to pass a TABOR initiative.
“There’s nothing that leads me to believe what happened in Colorado won’t happen here in Maine if we pass TABOR,” Martin said. “The problem is the formula that gets imposed on budget decisions. The formula itself is flawed and it doesn’t take into account the real cost of providing services. Public K-12 education, public universities, public safety, road infrastructure — TABOR doesn’t take any of that into consideration and says that it should be no different than the increases in costs we face in our own homes with regard to food or cars.”
Colorado, which passed TABOR in 1992, began to receive less tax revenue because TABOR puts a cap on state taxes. The cap is based on tax inflation and population growth. Setting taxes above that cap requires a voter referendum. Because of the decreasing tax revenue, Colorado decided to cut primary education, which in turn forced them to cut money from higher education to make up the difference for lower grades.
Martin said Colorado cannot attract teachers anymore because of TABOR. He believes Maine’s education system, including UMaine, will see similar decreased state revenue if TABOR II passes.
“One of the first things that they’ll see in cuts to the university is cuts to programs. You just won’t be able to have this particular program and educate students in this policy area or this particular subject area. So, you’ll start to see those cuts. Then you’ll have to cut additional staff, and then you’re going to have to cut student size,” Martin said. “And like in Colorado, what happened is tuition rates were increasing anywhere from 20 to 40 percent annually because they were receiving cuts from the state.”
Chris Cinquemani, the public affairs director of Maine Leads, the group advocating passage of Question 2, said there is nothing in TABOR II that requires cuts to state funding.
“What we’ve heard from opponents is that TABOR in Maine is going to force cuts to the state spending, and that is a flat out lie,” Cinquemani said. “TABOR always allows for growth in government spending, just at a reasonable level so that Mainers can afford to pay for it.”
Martin said the proponent’s message of no cuts is the real lie.
“The proponents of this bill, this question, will tell you there’s nothing in TABOR that will require cuts, and I hear them say that over and over and over,” Martin said. “But if you’re going to provide basic services, and the cost of those services increases 2.25 percent in a year, just to maintain the basic quality, but TABOR says you can only increase your budget 1 percent per year, based on the formula, and guess what? You have to make up the difference.”
Conlow agreed TABOR II will have a negative impact on Maine. She said Orono receives millions of dollars in state aid, and that TABOR II — which freezes state spending at a “base year” of 2010 — would mean Maine could spend less on municipalities like Orono. Under TABOR, state taxes that exceed property tax limitations would have to be approved by ballot, which Conlow said would be too costly to be realistic. She said it costs Orono about $3,500 to run an election, not including mailing costs.
Cinquemani said TABOR II does not add costs because of the voter referendum requirement. It instead requires any voter approval of tax increases beyond the formula to be added to existing ballots.
Councilor Thomas Spitz asked Conlow what effect TABOR II would have on emergency budgets. He said he worried the requirement for voter referendums reduce emergency budgets, which require immediacy.
Cinquemani rebuffed Spitz’s worries, and said TABOR II protects state and municipal emergency funds.
“In my mind, it’s almost like a Trojan horse. Get people to feel good about being able to vote on tax increases, but then you get this TABOR formula in there, and all the TABOR formula does is require you to cut, cut, cut,” Martin said.
Maine voters rejected a similar TABOR initiative in 2006, and the Poleski initiative in 2004, which Martin said was another version of TABOR. Cinquemani said the Poleski initiative was strictly a property tax measure, and was not related to TABOR.
The town council also voted to oppose Question 2 — the automobile excise tax initiative. Question 2 would reduce the mandatory excise tax charged when registering a vehicle by 55 percent for cars younger than six years. It would exempt hybrid and fuel-efficient cars from three years of the tax.
“It’s not green. Yes, you can buy a $70,000 Cadillac Escalade that gets you 20 miles to the gallon. Because it’s a hybrid, you get to get a rebate on your sales tax, and you don’t have to pay 50 percent of your excise tax. But you’re going to get less mileage on that car than most of the 6-year-old cars that are out there driving on the roads today that are getting 20 to 30 miles per gallon,” Martin said.
Martin said he believed 32 percent of Mainers would benefit from the passage of Question 2, because most cars are on the road are older than six years and very few are hybrids.
Bangor Daily News