Monday, April 21, 2014
WATERVILLE -- Mayor Karen Heck said Tuesday she doesn't think state revenue sharing for municipalities will be cut as proposed by Gov. Paul LePage in his upcoming biennial budget.
If it is cut, Waterville would have to raise taxes and reduce services to replace about $1.7 million it should get in revenue sharing, Heck said.
"Honestly, I don't think it's going to happen because Roger Katz, former Augusta mayor, has introduced a bill to restore revenue sharing to the percentage mandated by the state," Heck said Tuesday.
Katz, assistant Senate minority leader and an Augusta Republican, and Senate President Justin Alfond, D-Portland, both have submitted bills that would move the state toward its statutory mandate of revenue sharing.
"I honestly believe that the Legislature is ready to have a bipartisan discussion about revenue sharing and the state's obligation and how we can fund it," she said, "and about the tax strategy we're going to adopt at the state to pay for the important things that government provides."
Heck on Tuesday released a statement in response to a transcript of LePage's Friday radio address, which noted that "one of the more challenging" ways to balance a budget is to eliminate state revenue sharing to communities temporarily.
In his address, LePage said Waterville's share of state revenue is about 4 percent of the city's nearly $40 million budget.
As mayor of Waterville for eight years, LePage was able to balance the budgets while reducing property taxes, the transcript said.
"Working together with a Democratic City Council, I was able to reduce spending and lower taxes. A temporary loss in revenue sharing does not mean that property taxes will automatically go up. That is a local choice. It is not impossible for local government to save money, consolidate services and identify priorities," he said in the transcript.
Heck and the city's finance director, Chuck Calkins, said LePage mistakenly combined the municipal and school budgets, which underestimated the percentage of revenue sharing Waterville would lose if it is cut and the effect on those who pay city property taxes.
"As the governor well knows, revenue sharing is provided to municipalities to help offset the expenses of city services, not education," Heck's news release says. "In Waterville's case, the $1.7 million of revenue sharing we received actually represents 10.4 percent of the city's budget."
State revenue sharing to Waterville has decreased over recent years, according to Calkins.
In 2011 and 2012, the city received $1.7 million; in 2010, $1.8 million; and in 2009, $2.9 million.
Heck and Calkins also said LePage was mistaken about the city's $41 million budget figure, as the city's 2012-13 budget is $37 million. The municipal part of the budget is $16.4 million and the school's portion, $19.7, Calkins said.
Heck's statement also included one mistake about information she attributed to LePage. Her statement reported that LePage's estimate of state revenue sharing was 2 percent of the Waterville budget, but the LePage transcript stated it was about 4 percent.
LePage, in his address, also called on municipalities to consolidate services to save money.
Giving one example, he said Fairfield, Oakland, Waterville and Winslow should work together more to avoid duplicating services.
"Choosing to go at it alone is an expensive choice," he said.
Heck cited examples of the kinds of ways Waterville works to regionalize, including sharing technology services, and equipment with other communities. Waterville also shares a fire chief with Winslow, she said.
"True, we're both building police stations, but Waterville gave a proposal to Winslow about how we could share police services, and they (Winslow) did not think it was worth having us do that," Heck said.
Winslow also declined a proposal to share a high school with Waterville, she said.
One of the problems Waterville faces is that it is a service center, where the population of about 16,000 residents grows to more than 21,000 during the daytime as people come into the city to work and take part in other activities, according to Heck. The tax base has to support those extra people with police, fire and other services, she said.
"So it's really very difficult for the service centers to do without that revenue sharing," she said.
Amy Calder -- 861-9247