Sponsors seek return of senior property‑tax stabilization; assessors and municipalities warn of high cost

Sen. Jim Libby presented LD 1144, a proposal to reinstate a revised version of the property tax stabilization program for seniors that previously existed as LD 2 90, which the Legislature repealed last session. Libby said the bill would limit stabilizations to a single homestead per taxpayer, cap stabilized valuation to the first $900,000 of assessed value and allow municipalities to seek reimbursement of administrative costs.

Supporters described the program as a targeted option for seniors on fixed incomes facing steep increases in assessments. Tom Record, vice president of the Maine Association of Retirees, told the committee the prior stabilization law ‘‘was extremely popular with our members’’ and urged a fair, sustainable replacement. ‘‘Stabilization act that is fair and sustainable would be greatly appreciated by elderly homeowners,’’ Record said.

Sen. Libby said the bill was intended to avoid the abuses and runaway costs that helped prompt repeal of the earlier program, and he said new limits — valuation caps and one‑homestead rules — sought to curb the ‘‘big tail’’ of cost growth seen previously.

Municipal officials, assessors and the Maine Municipal Association testified in strong opposition. Amanda Campbell of the Maine Municipal Association said municipal officials ‘‘would argue that this program is 1 and the same as the original LD 290’’ and that reinstating it without means testing would again prove financially unsustainable for the state and administratively burdensome for local assessing offices.

Certified assessors and city managers described the earlier program’s administrative burden and the fiscal exposure it created. Justin Hennessy, an assessor who served during the previous program, said his town had nearly 900 applications during the prior iteration — ‘‘almost a quarter of our parcels’’ — producing large disparities in savings (from pennies to several thousand dollars) and creating a substantial state reimbursement owed to municipalities. ‘‘If there had been a $900,000 cap in place, I would not have denied a single one of those applications,’’ Hennessy said, arguing the cap proposed in LD 1144 would not materially limit cost in some communities.

Other municipal witnesses said the program had generated sudden, large state costs and raised fairness and portability problems (for example, stabilized tax amounts moving with a taxpayer to a higher‑tax community). Several witnesses recommended alternative approaches — expanding the homestead exemption, strengthening the property tax fairness credit, and improving outreach for tax‑credit takeup — rather than reinstating a stabilization program that they said previously proved unsustainable. Representative testimony also focused on whether means testing or an income‑based threshold should be required; municipal witnesses said means testing would improve equity but warned about local administrative burdens if municipalities had to verify income.

Why it matters: The bill would provide targeted relief to older homeowners but faces strong municipal and administrative objections on cost and implementation. Committee members asked for additional information and suggested that any future work session examine alternatives (expanded homestead exemption, property tax fairness credit) and administrative guardrails such as means testing and rules on improvements or portability.

Next steps: The committee closed the public hearing and will consider testimony and fiscal analysis at work session if members direct staff to do so.

Sources: Testimony from Sen. Jim Libby; Tom Record (Maine Association of Retirees); Amanda Campbell (Maine Municipal Association); Justin Hennessy (assessor); Don Ferrara (assessor); Mark Myers (city manager) and others.