Voters in Shapleigh will weigh whether to impose a cap on local budget increases via an ordinance that will likely lack force.
Petitioners managed to push the town to hold a vote on tying future budget increases to the consumer price index, a federal measure of inflation.
The rural York County town is taking up a version of an old debate in Maine. Two decades ago, anti-tax activists forced three statewide votes on capping taxes, and the Legislature put its own soft limit on towns. These discussions are coming back up at the local level amid growing frustrations in communities of all sizes.
If Shapleigh voters pass the spending cap, it may be largely symbolic. Only charter amendments can force a town council or select board to heed a spending cap, according to Kate Dufour, a lobbyist for the Maine Municipal Association. Shapleigh lacks a formal charter, instead relying on a list of ordinances.
“Just as one Legislature cannot bind a future Legislature, absent a charter provision, one town meeting cannot bind another,” she said. “If a town enacted a spending cap via an ordinance or warrant article, a future town meeting could simply ignore it.”
A handful of towns have passed charter provisions to bind their budget increases to the cost of living, including Bradley and Bath. Bradley, which has used the cap since 1996, explicitly allows its council to override the limit, which it has occasionally done over the years.
“It’s a great tool,” Bradley Town Manager Melissa Doane said, adding she believes it’s important “to have the flexibility to override it when there’s situations that occur that you can’t really control.”
Shapleigh’s proposed ordinance lacks an override clause. Even if the voluntary cap is followed, it might have limited effect in Shapleigh. Just like all other Maine cities and towns, it must pay the county and school taxes that are assessed by other elected bodies.
“We can only cap ourselves,” Town Administrator Michelle Rumney said.
Rumney said local costs began rising quickly after the pandemic. To ease the burden of rising school costs on taxpayers, the town delayed capital expenditures. Now, those projects are increasingly urgent.
“This past year, we had a significant increase because of a bridge that needs to be repaired, and the town of Shapleigh is not a fan of taking out loans, so that increase came all at once,” she said. “We held back to kind of compensate when the school was going up. It’s a catch-up game now.”
The idea of limiting local tax increases is not new. For nearly three decades, Maine’s property tax fights have swung between the ballot boxes and the State House. They run from anti-tax activist Carol Palesky’s first petition drive in 1996 to the Legislature’s recent repeal of a soft local cap.
Voters rejected the Palesky limit on property taxes in a statewide referendum in 2004. They also turned down a Colorado-style Taxpayer Bill of Rights in 2006 and again in 2009. In between, former Gov. John Baldacci’s 2005 tax reform package created a limit tied to the state’s average personal income growth and a local property value growth factor.
The 2005 cap limited growth only in the share of each town’s tax levy that paid for municipal services, and towns could exceed it if voters approved a separate override. At first, it seemed to work. In its first year, property taxes in towns it covered grew 1.2%, compared with 5.1% and 4.9% in the two years before, according to a state-commissioned University of Maine analysis.
But school and county taxes fell outside the cap, and school costs kept climbing. By the 2009-10 school year, 87% of school districts were over a separate state spending target. Gov. Janet Mills signed a bill repealing the cap in 2024, with opposition from Republicans but support from local officials who said it had become more trouble than it was worth.
“In practice this has created a significant burden on towns like Gray, needlessly requiring excessive amounts of staff time each year and [confusing] voters,” Gray Town Councilor Anne Gass wrote in 2024 testimony.
Daniel O’Connor is a Report for America corps member who covers rural government as part of the partnership between the Bangor Daily News and The Maine Monitor, with additional support from BDN and Monitor readers.
The photo of Mousam Lake is by Mark Fickett and is used under a Creative Commons Attribution 4.0 International license. It has been cropped from the original.