9/13/12 Bridgton News By Rep. Rich Cebra- It is painful to watch Democratic Rep. Seth Berry on his one-man crusade to mislead Maine voters about recently enacted income tax cuts. Who is Seth Berry and why would he mislead you? It’s an election year, of course, but this story begins nearly three years ago, with passage of LD 1495, the Democrats’ flagship tax reform. You may remember that it expanded the sales tax to 102 items and services, such as auto repairs, computer repairs and diaper services, and then lowered the top income tax rate by 2 percentage points, from 8.5 percent to 6.5 percent. For many, this was a real tax cut for the rich (over $6,000 on average) on the backs of the poor and working class. The Democrats passed it late in the night and by a nearly unanimous partisan vote. In response, a hodge-podge of concerned taxpayers, including the Green Party, formed the group “Still Fed Up with Taxes.” In a monumental effort and against a well-funded, organized group of signature blockers – led by Rep. Berry – they were successful in gathering over 60,000 signatures to place the issue on the ballot. Undeterred, Maine Democrats, again led by Berry, challenged the signatures in court. Maine Superior Court rejected their claims, and in a June referendum, Maine voters overwhelmingly repealed the Democrats’ new law before it could take effect. In the next election cycle, Republicans took over the Legislature and the Governor’s office. In an act of true payback, Maine Democrats appointed Rep. Berry their minority lead on the Taxation Committee. Recently, Berry has published misleading columns in nearly every major Maine paper, calling the new income tax cuts a “shift” on to the working people and claiming they are a “giveaway to the rich,” even though he and most of his fellow Democrats voted for them. (He has sent the same column, verbatim, to all major Maine dailies.) It does not matter to him that the experts disagree. Maine Revenue Service (MRS) officials describe the new system as more progressive than the old one, because high-income Mainers will shoulder more of the overall income tax burden. The Maine Today newspapers, in their “truth test” coverage of Democratic TV ads, reached the same conclusion, stating, “Maine’s income tax is more progressive because of the changes.” Rep. Berry tries to further confuse Maine people with another sleight-of-hand comment: “Due to many tax measures passed by the majority, the few making $350,000 and up will receive an income tax cut of $3,000. In future years, this windfall will increase to more than $24,000 per year.” What he did with this claim was combine two new laws – the budget and LD 849. The income tax cuts take effect in 2013, and nearly all Maine households will see higher take-home pay. In contrast, LD 849 is unlikely to affect anyone now – or indeed, if ever. LD 849 is a “trigger” bill. It changes the way surplus state revenue is doled out. After all state spending obligations have been met, surplus revenue is filtered through a series of funds called the “cascade.” The last “fund” is the “income tax relief fund.” Under LD 849, surplus funds would be used to gradually lower income tax rates. In order to give “the rich” the $24,000 tax cut Rep. Berry cites, MRS estimates state government would have to experience a surplus of $3 billion. Considering the entire state budget is $3 billion, this claim is ludicrous. Rep. Berry continues his distortions with claims that cuts to towns and property tax programs will cost “homeowners and renters more than $400 apiece.” Naturally, he left out some crucial facts. Municipal revenue sharing – money sent to towns – was not cut this session. According to the non-partisan Office of Fiscal and Program Review, it went up. The big cuts he refers to actually occurred when Democrats were in power in fiscal years 2008, 2009 and 2010. Revenue sharing was cut in each of those years, declining from $133 million in 2008 to $93 million in 2011. In 2012, by contrast, revenue sharing increased by nearly $4 million and went to $96.9 million, and in 2014 it’s scheduled to hit $141 million. In addition, the Republican-led budget increased education funding by $63 million. The cuts Rep. Berry cites were enacted under Governor Baldacci in LD 353, (Public Law 2009, Chapter 13), which Rep. Berry supported as a member of the Democratic majority. The same bill included a 20 percent cut to the “Circuit Breaker” program and another cut to the Homestead Exemption. Rep. Berry is one of the most partisan Democrats in Augusta, and he is a man who holds a grudge. It’s unfortunate that he cannot debate the issues on the merits but instead is reduced to trying to fool Maine residents.
### State Rep. Rich Cebra (R-Naples) chairs the Legislature’s Transportation Committee