A new state law went into effect Aug. 8 enabling older Mainers to freeze their property tax rates.
A row of homes on Barton Street in Presque Isle. A new state law went into effect Aug. 8 enabling older Mainers to freeze their property tax rates. Credit: Paula Brewer / The Star-Herald

The BDN Editorial Board operates independently from the newsroom, and does not set policies or contribute to reporting or editing articles elsewhere in the newspaper or on bangordailynews.com.

Last year, lawmakers hastily passed a property tax break for seniors that was badly targeted and likely to cost communities unexpectedly large sums of money.

Given more information and time to be thoughtful, lawmakers are rightly taking another look at this overly broad tax relief effort.

The new law, which was passed quickly last spring and became law without the governor’s signature, freezes property tax payments for Mainers over age 65, if they have owned a home in Maine for 10 years, which don’t have to be consecutive. Those seeking the benefit must apply to their community each year. If they fail to reapply, the taxes owed could be substantial.

There are no income limits or limits based on the value of a property. A homeowner could make substantial improvements to their property and not pay more in property taxes. A homeowner could even move from one community to another with higher taxes and continue to pay the lower property taxes. The state is supposed to reimburse communities for the taxes that they will lose, but not enough money has been appropriated to do this.

The cost of the program is expected to rise each year.

One of the biggest flaws in the property tax freeze plan is that it doesn’t target the relief to those who actually need it.

The oldest American generations have far more household wealth, on average, than younger generations. Much of that is because of homeownership.

To be clear, too many older Americans live in poverty. That is a problem that should be addressed with targeted assistance, not an overly broad tax break that isn’t sustainable for local communities or the state.

If lawmakers are really concerned about helping older Mainers who can’t afford their property taxes, there are much better ways to do so.

The Legislature is already considering changes to the program, including one bill that would make it more targeted.

House Majority Leader Maureen Terry, D-Gorham, has proposed to replace the program with a larger homestead exemption that is targeted to low-income seniors. A homestead exemption exempts a portion of a property’s value from taxation.

Terry’s bill would increase the homestead exemption by $25,000 for seniors making less than 80 percent of the regional median income and $15,000 for those between 80 percent and 100 percent. This would put income limits into a program that had none.

That makes sense.

Sen. Rick Bennett, R-Oxford, would increase the homestead exemption by an additional $75,000 for those over the age of 65. His bill, which also scraps the existing freeze, includes no caps on income.

A property tax freeze for older Mainers may have been well-intentioned. But the program that was enacted last year was poorly structured with its benefits not targeted to those who need the most relief.

Revamping the program, and directing its benefits to Mainers who most need property tax relief, is an essential improvement.

Avatar photo

The BDN Editorial Board

The Bangor Daily News editorial board members are Publisher Richard J. Warren, Editorial Page Editor Susan Young, Assistant Editorial Page Editor Matt Junker and BDN President Todd Benoit. Young has worked...