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Question: Is Maine doing the right things to attract and retain the elderly citizens who contribute positively to our state?
Sean Faircloth:
ensus data says Maine is the oldest state in America. The best thing Maine can do for older citizens is attract young educated workers.
I sponsored a research and development tax credit in the 1990s. Maine should expand that, and support more bonding for R&D. Maine should cut taxes on necessities like income and residential property.
Don’t get me wrong. Maine should continue to protect seniors. According to Jud Dolphin, state director of the American Association of Retired Persons, Maine provides better long-term care than most states
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LD 1 holds down upward pressure on property taxes by providing relief to towns. Maine offers the circuit-breaker property tax relief program.
When Washington bureaucrats created the flawed Medicare part D plan, Maine already had a better program for prescription drugs. We made sure to retain that program. Maine’s low-income drug program for the elderly is important to survival for some.
Most seniors work productively, even after ending their “primary” career. According to an AARP membership survey, older Mainers most seek affordable prescription drugs and the ability to stay at home—avoiding nursing facilities. All good policies.
Yet Maine faces tough realities: Maine’s average income is low, the number of seniors high. The burden falls heavily on our small working-income population.
What to do? Cut taxes and increase research and development.
Maine ranks dead last in university R&D expenditure. (Dead last in R&D in the 21st century is like dead last in railroads in the 1800s.)
Maine’s highest marginal income tax rate kicks in at less than $20,000 per year. That’s no typo. Maine gouges a single mom working full-time, for not much over minimum wage, snatching 8.5% of her hard-earned $20,000—the highest rate.
How do we pay for tax cuts for necessities?
First, eliminate unfair Swiss-cheese sales tax exemptions. Business A shouldn’t be required to impose sales tax when Business B is exempt.
Second, impose taxes on frills so that we can cut taxes on necessities. Some call taxes on alcohol, soda, and cigarettes “sin taxes.” Not me. A “sin” is cutting needed services to children with mental disabilities. A “sin” is cutting taxes for unemployed, rich trust-fund babies while millions are denied health care. Harming vulnerable people is a “sin.” Having a pop, a belt, or even a smoke may be a mistake, but it’s no sin.
I happily enjoy my frills, but we can pay a little more for frills in order to meet necessities. Studies prove youth consumption of frills (cigs, soda, booze) decreases as the price increases.
Great result!
Obesity’s cost to taxpayers? Billions. Alcohol’s cost to society? Billions. Smoking? Billions. Fiscal conservatives should love these taxes—especially when working people AND retired executives get income tax cuts.
That, combined with more R&D, will lead to high-wage jobs. The more workers in Maine, the broader the tax base to fund programs like long-term care. Maine seniors will be more secure when Maine is NOT America’s oldest state.
Sean Faircloth sponsored Maine’s first research & development tax credit and initiated the Maine Discovery Museum in Bangor.
Scott K. Fish:
Bruce A. Chalmers is worried. The owner/president of the third generation Chalmers Group sees Maine taxes, regulations, and “loser” programs driving out Maine’s best-and-brightest elderly—job creators, community builders.
“What really opened my eyes? My dad spearheaded the building of Bridgton Knitting Mills,” Mr. Chalmers said in an interview. The mill was a major area employer. “When the mill closed, good people tried to keep it open. When they tried to sell the idea to their bosses, the tax situation caused them to say no.”
Mr. Chalmers’ second revelation came while he was thinking about his neighbors and friends on the street where he lives: all good people who love Maine, retired or nearing retirement from distinguished Maine careers, who are either moving away or no longer claiming Maine as their primary residence.
Chalmers takes me for a virtual walk down his street, describing each neighbor and their relation to Maine.
“This house belongs to a senior vice president of a major U.S. insurance company. Not a Maine resident.”
“This family’s house is for sale. They’re becoming Florida residents.”
“The one-time number-two guy of the largest investment firm in the U.S. owns this home. They’re Florida residents,” says Chalmers.
The virtual tour continues: “The private investor; the head of sales of a large manufacturer in Maine; head of an investment firm in Maine; dentist; retired Bridgton Academy teacher.” All of them official Floridians or about to become so.
Chalmers’ neighbors fit the profile of job creators, people who could find Maine a place to start or expand a business. But, warns Chalmers, that’s not happening. “Not with the tax situation we have in Maine,” he says.
“Most of these people love Maine enough,” he says, that they would stay in Maine if asked to pay a “reasonable tax.”
“These are the people on Maine hospital boards, library boards, chamber of commerce boards,” Chalmers said.
The death tax is especially unattractive to people like these who’ve built businesses, estates—the American Dream—during their lives, with plans to leave their estates to children and grandchildren.
The combined fed/state death tax lets government take about half of our estates when we die. Chalmers says getting rid of the state death tax will help keep these people in Maine. If Maine continues losing and repelling these elderly, the balance of Maine givers to takers will grow even more out of balance.
Haven’t we been hearing since the Governor King administration that Maine is having a renewed in-migration of elderly? I asked Mr. Chalmers. “Elderly people with money are not voluntarily moving back to Maine. My opinion,” he answers.
“A prominent Portland lawyer was telling me of another lawyer with 60 cases on his desk of people leaving Maine,” Chalmers said, adding, “Talk to accountants.”
The names of famous well-to-do Mainers come up. Former U.S. senators George Mitchell and Bill Cohen. Author Stephen King. Is Maine their prime residence? If not, why not? I’ll work at getting the answer for the next Bangor Metro.
Scott K Fish is owner/editor of the website www.asmainegoes.com. He lives in Dixmont.
