Maine Dem Claims Credit for GOP Tax Break

Gideon repurposed millions of dollars from tax relief account that Dems opposed

Sara Gideon
Sara Gideon / Facebook
January 12, 2020

Democratic Senate candidate Sara Gideon is claiming credit for a Republican tax break her party opposed in her bid to oust Sen. Susan Collins (R., Maine).

In a new campaign ad, Gideon, the speaker of the Maine House of Representatives, touted her sponsorship of a property tax relief bill that will pay $30 million to local homeowners in 2020. The payout will come out of a fund set up by state Republicans in 2012 as part of an income tax relief system. Gideon was not yet in office when the tax break was passed, but her partymates were nearly unanimous in opposing it. Jacob Posik, spokesman for the conservative-leaning Maine Heritage Policy Center, called the ad "misleading."

"Gideon's ads are misleading—all she really did was change the purpose of the fund, which was already in place and had built up revenues over the [GOP Gov. Paul] LePage years, and make disbursements in 2019 before running for the Senate," Posik said.

In March 2012, the Republican-controlled legislature passed a law that set up the Tax Relief Fund for Maine Residents, a multimillion-dollar endowment created to gradually reduce income tax rates of Maine residents to 4 percent. Gideon, who assumed office seven months after the bill became law, has since raided the fund and repurposed the money to go to homeowners exclusively, rather than all state taxpayers.

The Gideon campaign did not respond to request for comment.

The Maine Republican party criticized the ad as "disingenuous" and accused Gideon of using the fund to bolster her political ambitions, rather than the long-term interests of residents. Gideon's $30 million payout almost exhausts the endowment, which had $33 million as of July 2019.

"It's true that people are getting tax relief, but that money is entirely due to Republican foresight from back in 2012," Maine GOP executive director Jason Savage told the Washington Free Beacon. "It's really disingenuous and dishonest of Sarah Gideon to take credit for it."

The fund was designed to grow until it could begin to shoulder some of the income tax burdens of state residents. Gideon, however, repurposed the money into a cash handout to Maine homeowners after shifting its focus from income to property tax relief.

"She clearly has political designs on this whole thing," Savage said. "I mean, there's no other way to be so brazen about just taking a Republican savings fund and renaming it and taking credit for it."

Posik also said that while the original GOP legislation would have provided tax cuts to everyone, Gideon's revisions provided relief to only homeowners.

"Mainers would be better off with a tax relief fund that gradually reduces the income tax to 4 percent for everyone than a property tax relief fund where all Mainers do not realize the benefits," Posik said. "An income tax reduction would benefit more Mainers and be long lasting, whereas a $103 property tax payment will be absorbed when towns make upward adjustments to their [tax] rates."

Gideon's ad says the revision is the first direct property tax relief bill to be passed in "many years." Savage said Democrats have been ineffective at reducing the actual financial burdens of Maine residents, pointing to policies that drove up costs for taxpayers.

Savage pointed to a state revenue-sharing program adopted by Democrats that distributed money from state coffers to local governments. The policy's champions said it would entice local governments to reduce property taxes. The program had the opposite effect as local governments expanded their spending rather than lower their tax rates, according to a study by the Maine Heritage Policy Center.

Republican State Representative Amy Arata said the Gideon ad papers over Democrats' opposition to tax relief.

"Mainers are being misled, and that's unfortunate because I really wish they could see the big picture and what Republicans have done to help Maine's economy," she said. "I'm not going to accuse Sara of being a liar. But it's certainly a bit misleading."

Gideon is attempting to unseat Sen. Susan Collins, the three-term moderate Republican. She faces an uphill battle, though polling has been limited in the state. A June survey of registered voters found Collins ahead by 14 points.

Published under: Maine