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Posted on: September 9, 2021

City Proposes Bridge Program to Support Property Tax Relief for Low-Income Seniors

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City of Portland staff is proposing a “bridge program” to provide property tax relief for low-income seniors until the State’s new tax deferral program (LD1638) takes effect. The City has been working hard to educate the public on the purpose of the recently completed revaluation process, the first one in nearly 15 years, and provide information regarding available property tax relief programs available to residents. The City Council’s Finance Committee will discuss the program tonight in a remote meeting at 5:00 PM

In addition to many existing relief programs, the City lobbied at the State level on behalf of several proposed tax relief laws enacted in early summer 2021. One of these laws, LD1638:  An Act to Help Seniors and Certain Persons with Disabilities Remain in their Homes by Providing for the Deferral of Property Taxes, which was signed into law by Governor Mills on July 19, 2021, would allow qualifying taxpayers to defer their property taxes due until the sale of their homes at a later date. Under this program, the State of Maine would pay a municipality directly for any property taxes due, place a lien on the property, but not foreclose on the loan so the property taxpayer could remain in the home as long as necessary. Unfortunately, due to the timing of the law passage, the program will not go into effect until the FY23 tax year (with the application period opening in January 2022 for FY23 tax bills.) Due to this, the City’s proposed “bridge program” will be a great way to assist eligible taxpayers until the State’s deferral program goes into place. 

The City’s proposed “bridge program” has two important components -- the first is an increase to the Portland Senior Tax Equity Program (P-STEP) for low-income senior property owners. The P-STEP reimbursement amounts for eligible homeowners would be doubled from a maximum of $1200 to a maximum of $2400 for FY22 only and applied directly to property taxes due. The second component involves direct outreach to senior residents who may meet the criteria for deferral under LD1638. The property taxpayers who meet the State criteria would be put on a customized payment plan utilizing all available tax relief resources including the P-STEP to provide a repayment bridge to FY23 when the State deferral program would be in place. 

It is estimated that the first component of the bridge program would carry a cost of approximately $100,000 to the City based on current P-STEP levels, however it may be eligible for reimbursement with ARPA funds. The second component would require significant additional administrative effort, and the addition of a Treasury staff person, to administer this program. 

“We were thrilled to advocate for these additional state programs to complement the existing programs we have so that our fixed-income senior population has aging in place options available to them,” said Finance Director Brendan O’Connell. “We feel it is critical to provide as much relief in FY22 as possible due to the potential impact of the revaluation.” 

For a list of existing tax relief programs, click here

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