The February issue of Working Waterfront/Inter-Island News included a letter from Eric Davis of Vinalhaven and an op-ed piece from members of the North Haven Board of Assessors, both critical of the so-called Chebeague Plan, officially known as the Maine Land Bank and Community Preservation Program. We would like to respond to these comments in order that people may make informed decisions about this important piece of legislation.
Mr. Davis’ criticism of the Land Bank is that it “allows people who are nonresidents to be in the program.” He makes the mistaken assumption that any non-resident can afford to pay double or triple current taxes on their “second or third home.” That is simply not true. I don’t know about non-resident landowners on Vinalhaven, but I can state with complete certainty that our “summer natives” (people who have been coming to the Island for generations) care as deeply for their community and are as much a part of it as are our year-round residents. And without them, Chebeague would not be the vibrant community it is today. It is not just their money that nurtures the island, it is their background, experience, and expertise in getting things done. Among other things, Chebeague would not have its library, recreation center, assisted care living facility, or even the island ferry if it weren’t for those “damn summer people.”
And, no, not every seasonal resident is rich beyond belief. And, yes, seasonal people are worried and are considering other options as property taxes fly out of sight. Now, I don’t know about you, Mr. Davis, but I don’t want to see these pillars of our community (seasonal as they may be) replaced by outsiders who can afford exorbitant property taxes, but don’t give a tinker’s damn about the Island! That takes the “community preservation” piece right out of our program.
But, for the sake of argument, let us assume that Maine has the political will to create a different tax structure for second homes and/or out-of-state property owners. We are informed that such a proposal would not fall under the Homestead program without a constitutional amendment, for which there are at least two Legislative Requests now pending in Augusta. Such an amendment would be in addition to the constitutional revision required to enable the creation of the Maine Land Bank program.
If that were to happen, the two measures could still peacefully coexist. The Land Bank would establish a stable and predictable assessment base for program participants and those who commit the venal sin of being “from away” would pay at some to-be-determined higher rate.
One last comment on Mr. Davis’ contention about “the state’s Tree Growth program – it’s all lost revenue with no reimbursement from the state.” Towns other than Vinalhaven happily receive their reimbursement from the state simply by complying with the state’s rules concerning timely property revaluations.
As to the assessors from North Haven, their thoughtful comments concerning the impact of the Maine Land Bank would be valid if their arguments weren’t based on several unrealistic assumptions.
First, even given the established nature of families on North Haven, we don’t believe that the participation rate will approach anywhere near 80% of the landowners. Why? Human nature. Our discussions with similarly entrenched families indicate that as long as they can pay their taxes, many are reluctant to limit the potential for financial gain were they (or their offspring) forced to sell their land.
Second, it is unreasonable to think that there will never be any withdrawal from the Land Bank Program for any reason. Again, human nature dictates that there will be life events such as changing priorities, divorce, or estate settlements that will engender withdrawal from the program. Granted, in a small community these will be few in number, but they must inevitably occur and with penalties sixteen times the annual tax savings, even that small number will fund the program. And even if they don’t, isn’t it worth it to maintain the vitality of the community, rather than turn it over to the super-rich?
Third, the point may be lost here that the Maine Land Bank involves only land, not buildings. Buildings (along with any new construction or expansions) will continue to be taxed as they are now at replacement cost less depreciation thereby increasing the total tax assessment.
Lastly, and perhaps most importantly, the authors state “it is hard to find sales that reflect true current value.” This being so, it is highly unlikely that North Haven is experiencing anything like the 200% to 300% inflation in assessments experienced on Chebeague Island over just five years. With low rates of inflation, the savings realized by joining the Land Bank are minimized and the impact on non-participants is also minimized. In other words, North Haven doesn’t have the problem that Chebeague has. And one last thought on this point: How will Barney Hallowell’s proposal to tax the sale of high-priced properties help if nothing is sold at fair market value?
All these factors taken together would suggest that North Haven, like every other community in Maine, will benefit from the advantages offered by the Maine Land Bank Program and will do so in a self-funding manner.
We value and appreciate this discourse on solving at least one of Maine’s taxation problems. And we issue this challenge: We know that the Maine Land Bank and Community Preservation Program will benefit tens of thousands of Mainers. If you believe that it doesn’t work for you, please tell us how to fix it or tell us what will work. We sincerely want to save our island and preserve our community and all the valued citizens thereof.
David R. Hill
Chebeague