By Amanda Estes
Staff Writer
    Scarborough senior citizens who qualify for the State of Maine Residents Property Tax Program are now also eligible for up to $500 in additional cash refunds under the recently approved Town of Scarborough Property Tax Assistance Ordinance. Last week, the council unanimously approved the ordinance and allocated $207,000 of the 2008 municipal budget for its implementation.
    Councilor Ron Ahlquist said a municipal property tax assistance program was at the top of his list when he was elected to the council last year. Although Maine voters as a whole opposed the Tax Payer’s Bill of Rights (TABOR), Ahlquist said Scarborough residents favored the measure as a method to limit government spending and refund surplus revenues to taxpayers.
    In terms of the number of residents who currently apply for the state program, Paul Lesperance, Scarborough’s Town Assessor, said during the last application period, the state received 1,826 applications for the overall refund program and 1,503 of those applications were approved. Statistics on the number of senior citizens who received refunds were unavailable.      
    Ahlquist said education would be the key component to making the program a success.
    “Senior citizens are less apt to apply for a tax refund program,” he said. “For whatever reasons, they are a little timid for putting in for a program like this.” He said implementation of the ordinance would be accompanied by an “aggressive” educational campaign.
    Matt Sturgis, Cape Elizabeth’s Town Assessor, has been making an effort in his own community to promote the state program through education. Last year he worked at the polls and he is currently running a PowerPoint slideshow on the town’s public access channel. Sturgis said spreading the word about the program’s broadening of income eligibility requirements has been his focus since the change was made two years ago.    Last year, 1,025 Cape Elizabeth residents applied for refunds and 881 were approved with the average refund totaling $729, Sturgis said. He said Cape Elizabeth residents received roughly $645,000 in refunds last year.
    According to the state of Maine Web site, in order to qualify for a tax refund, residents must submit an application between Aug. 1 and the following May 31 for refunds for the previous year. Applicants requesting refunds must have been a resident of Maine for a full year, maintained a homestead for all 12 months of a year and lived in the homestead for at least six months out of the year. Finally, property taxes for the previous year must be more than four percent of the household income or rent for the previous year must be more than 20 percent of the household income. The total household income must not have exceeded $77,000 for a person who lived alone or $102,000 for a person who lived with a spouse and/or dependent.
    Seniors do not need to meet those requirements if the total household income was below $12,700 for a person who lived alone or $15,700 for a person who lived with a spouse or dependent. Applicants must have been age 62 or older or 55 or older if disabled. If an applicant is disabled and married, both the applicant and the spouse must be disabled and receiving federal disability funds. Applicants qualifying for both refunds will receive the larger of the two amounts.
    “The legislature has definitely created this to apply to the majority of Mainers,” Sturgis said. “(The program) is really going to capture a lot of people in that income bracket.” Sturgis said the town has been successful in advocating that property tax relief can benefit a wide range of people.
    In addition to having received refunds from the state program, Scarborough residents must be 65 or older at the time of the application and they must have been a resident for at least 10 years proceeding the application date. Under the ordinance, a homestead is defined as a “dwelling owned or rented by the person seeking tax assistance…or held in a revocable living trust for the benefit of that person.” The applicant and the applicant’s dependents must occupy the dwelling as a home.  
    Councilor Carol Rancourt said Maine’s property tax program is a “very underused program.” Rancourt, who works at the Southern Maine Agency on Aging, said many seniors think of property tax refunds as a hand out.
    “Every year more do (apply), but there’s still a significant number who do not,” she said. “Either they don’t realize they’re eligible or they feel reluctant to apply.” Rancourt also said the state program has become more accessible for people of varying incomes. 
    The Municipal Property Tax Assistance law was adopted in 2005 and Scarborough is one of several communities to go through the steps of implementing an ordinance. Prior to 2005, Sturgis said municipalities did not have the authority to grant tax relief. Michael Rogers, supervisor of the Municipal Services department of the Maine Revenue Service, said York has a successful program in place and Jay and Cumberland are considering their own programs.
    When crafting an ordinance, Rogers said the municipality’s program must be modeled after the state program. The municipality must appropriate the money to fund the program each year. Residents applying to both programs cannot get more than half of their taxes due back and the refund must not exceed 60 percent of their property taxes.