Skip to main content

Municipal Employees Welcome Full Restoration of Revenue Sharing to Local Communities

Andy O’Brien
Social share icons

Municipal workers welcomed Governor Janet Mills’ announcement this week that her administration has fully restored municipal revenue sharing to 5 percent of sales, personal and corporate income taxes for towns and cities. It is the first time since 2009 that revenue sharing has been fully funded as former Governor Paul LePage gutted the program to pay for pay for his tax cuts for the wealthy.

By fully funding revenue sharing, the state will provide an estimated $233 million for fiscal year 2023, compared to $93 million it would have delivered to municipalities if funding had stayed at LePage's 2 percent policy. Union leaders say the extra money will take the pressure off of property taxes and potentially make it easier to bargain better contracts for municipal employees.

“It’s a good thing, especially for larger service center communities, because they have to provide additional public services, like public safety and road maintenance, for citizens who come from other towns that don’t provide property tax revenue,” said Michael Scott, an Auburn firefighter (IAFF 797) and secretary of the Professional Firefighters of Maine. “Any additional revenue coming into the municipalities that doesn’t come straight from property taxes always makes it a little bit easier for the municipalities to figure out their budgets.”

When the state implemented revenue sharing in 1972, its original intent was to keep property taxes in check by covering the costs of unfunded state and federal mandates imposed on municipalities. But after being elected in 2010, former Governor Paul LePage slashed revenue to 2 percent and even sought tocompletely eliminate the program. As a result, towns and cities were starved of funding and forced to freeze hiring, lay off employees andraise property taxes to make up for revenue shortfalls and pay for basic services. 

“During the LePage administration, we ran short and we didn’t hire new employees to keep the budget in check and that still resulted in a tax increase,” said Scott.

Carol Sanborn, President of Machinists Local S-89, which represents municipal workers throughout Maine, said that when the state shortchanged communities it suppressed wages and made it difficult for municipal employees to do their jobs properly. 

"Not only are these workers themselves tax-paying residents in their communities, and struggling to pay mortgages, medical bills, and property taxes like everyone else, they were also told to sacrifice pay, benefits, and working conditions in order to allow for continued funding of schools and public works services and facilities," said Sanborn. "We hope that this revenue-sharing increase will be used to help alleviate some of these issues for working class families."

Under Governor Mills, Maine has also fully funded the State share of education costs at 55 percent for the first time in history after previous administrations and legislature ignored the 2004 law for several years.