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Real estate excise tax hike abandoned

Don’t raise revenues. Cut costs.

That was the simple but strident message at a Tuesday public hearing on the 2004 city budget, before a packed hall in the council chambers at City Hall.

The specific target of citizen ire was a proposal to double the city’s share of the real estate excise tax – derisively described as a “departure tax” – paid on the sale of homes and land.

Based on the average price of island homes, the hike would cost sellers several thousand dollars at the time of sale.

That was enough to bring out local real estate professionals, and those they represent.

Ana Richards, a John L. Scott professional, cited an elderly client who is moving to an assisted living facility and needs expensive medication, and a family that is selling their home while supporting a child with medical challenges. Both, she said, need every dollar they can wring out the sale of their homes.

“These stories are not unusual,” Richards said. “These are our friends, neighbors and fellow islanders who have to live with the decisions you make.”

Ed Kushner, who for years owned the island’s Windermere Real Estate office, said the excise tax hike would not be a “departure tax” at all; by his observation, many home sales are by folks simply moving elsewhere on the island.

The council heard from several residents, one recently widowed, who described themselves as “tax victims,” selling their homes because they cannot keep up with rising property taxes.

Others argued that in tough financial times, the city should find ways to cut spending.

“It’s time you live within your means,” islander Rich Schmidt said.

That message found a sympathetic ear on the dais; Councilwoman Debbie Vann said the city has had “no accountability in our budget, ever.”

Vann and Debbie Vancil swayed the other three council members on hand – Michael Pollock and Bill Knobloch were absent – to spike the tax hike altogether.

“I’ve never supported it,” Vancil said. “I didn’t support it, and I won’t support it if it comes back one more time, or two more times, or three more times.”

The decision sets up a challenging home stretch for the council as it hammers out the 2004 budget.

The hike would have raised an estimated $300,000 in new revenue, without which some programs and proposals will likely be axed.

The draft budget did find some supporters. Representatives of several social service agencies spoke in favor of continued or expanded funding, while downtown interests called for city funding of a planning process aimed at keeping the Winslow core viable for anchor businesses.

While joining his colleagues in voting to kill the excise tax hike, Councilman Norm Wooldridge also sounded a cautionary note, saying local roads will suffer without adequate funding for maintenance.

His sentiments were echoed by retired highway engineer Vince Mattson, who quoted a favorite television commercial in support of more dollars for roadwork.

“Pay me now, or pay me a lot later,” Mattson told the council. “Okay, it’s not a direct quote, but it’s a lot truer than the commercial.”

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