With all due respect I stated that Maine has the highest tax burden of all the 50 states (that is a well known fact). Business taxes and the costs to do business in this state are another dire subject which I won’t get into on this website. Owning 2 businesses in this state for the past 17 years I am fully aware of the costs to do business here and the disheartening business environment created up in Augusta.

If the Town of South Berwick has to vote on LD1 cap issues
the public will have a more informed vote if they understand the legal difference between these two words:

EXCEED or INCREASE.

If the Town votes to EXCEED the LD1 limit
then the public is voting to allow the town to go over the LD1 limit for
that one budget year.

If the Town votes to INCREASE the LD1 limit
then the public is voting to allow the town to override the the LD1
formula and establish a new higher base for the LD1 formula to work
from in all the years forward.

Here is a description I found from the Maine Townsman, March 2005

“If the municipality’s property tax levy limit is $500,000, and the voters approve “exceeding” the limit by $50,000 in order to rebuild the town office destroyed by a fire, when the town begins to calculate its property tax levy limit for the following year, the levy limit upon which that calculation is based will be $500,000, not the actual commitment of $550,000. If the town meeting, instead, voted to “increase” the levy limit to $550,000 —the starting point upon which the subseequent year’s calculation would be based is the increased limit of $550,000.

From the report Understanding Maine’s Tax Burden and Business Climate
“That which influences business investment and location decisions is the quantity and quality of public services (such as schools, roads and highways, sewer systems, recreational facilities, higher education and health services). Furthermore, it is a well-trained labor force and high-quality public services that are of equal or greater importance [as opposed to taxes] to businesses.”

Also Maine has other obstacles to business investment, including “lack of proximity to major markets; the need to maintain an extensive, mostly rural road network; a cold climate which requires energy costs higher than in warmer climates; workers’ compensation costs; and lack of “thick” labor markets in some industries.”

If Maine and South Berwick really want to attract businesses and jobs we have to look at the whole picture–we need to figure out what we need to invest in and what we need to cut back on in an intelligent way otherwise we may cut off our nose to spite our face.

Until the people in Augusta wake up and realize that we need to be friendly towards creating business and industry (not depending solely on tourism) to create jobs for your citizens this great ship of Maine will continue to sink-and when it sinks it will take along with it all the towns and it citizens with it. It’s all about jobs people. With no jobs there is no money-no money for people to buy goods and services from local merchants which in turn leads to lower sales taxes, lower income taxes and burgeoning welfare/social costs leading to budget deficits. What is going to keep the young people here? With out opportunity for young high school/college grads most are moving out of state creating a brain drain and now Maine has one of the oldest average populations in the country which leads to other great distinction-THE HIGHEST TAX BURDEN IN THE COUNTRY.

As a lifelong resident of this town and state I would encourage everyone to get involved both on the state and local level-get your friends and neighbors involved, get out and vote!

Clearly, NO lessons have been learned.

This article says the reason we have a problem is lack of revenues.

The biggest drop in “revenues” is “Use of Undesignated Funds.” Below is a history of this line item used as a “revenue” source in the Town’s budgets. Notice that for year 08/09 the number is a big ZERO.

99/00 $250,000 13% of budgeted revenue
00/01 $365,000 17% of budgeted revenue
01/02 $600,000 24% of budgeted revenue
02/03 $600,000 23% of budgeted revenue
03/04 $370,000 17% of budgeted revenue
04/05 $400,000 18% of budgeted revenue
05/06 $500,000 18% of budgeted revenue
06/07 $450,000 14% of budgeted revenue
07/08 $500,000 16% of budgeted revenue
08/09 $ ZERO

The real reason this number is ZERO is because the “Undesignated Fund” has been managed in a different way over the last three or four years.

Between 2004 and 2007 the Town has drained its nest egg (the Undesignated Fund Balance) by $717,425, without replenishing it.

The nest egg, termed the “Undesignated Fund Balance,” is important because it is used to cover “timing” issues. A household example of the “timing” issue that we can all relate to is:

I put into savings every two weeks so that when the time comes I have a large amount of money to pay an upcoming bill such as a property tax bill. After that bill is paid I then continue to replenish my savings account so that I can do it again the following year. In this scenario, as long as I actually do replenish my savings account I am living within my means.

When the Town of South Berwick votes to use Undesignated Fund Balance towards the upcoming budgeted appropriations it must realize that during the year the undesignated fund balance needs to be replenished.

Without replenishing the fund it is simply known as living beyond your means. This is what the Town of South Berwick has been doing.

Blaming the revenue drop on lack of economic development is a truly UN informed argument.

Losing $700,000 in savings combined with two clerical errors worth $204,000 amount to $904,000. If we had the $904,000 back then we could play the usual “timing” game with the budget and things would go along relatively smoothly.