Lack of state education aid fuels hike

Rockland sets tax rate, up 7.3 percent

By Stephen Betts | Aug 14, 2019
Photo by: Stephen Betts DuPont is Rockland's largest property taxpayer.

Rockland — Rockland taxpayers will soon get their property tax bills, which are up more than 7 percent from a year ago, due largely to the state funding formula for schools.

The city assessor set the municipal tax rate Tuesday, Aug. 13, at $24.76 per $1,000 of assessed property. That represents a 7.3 percent increase from last year's rate of $23.08.

The average home in Rockland is assessed at about $184,000. That average home will see its tax bill jump $310 to about $4,500. That does not take into account, however, the state homestead exemption, which exempts the first $20,000 of a person's primary home in Maine. That would reduce the tax bill by $495.

The exemption is being increased to $25,000 in 2020.

Of every $1 in taxes collected, 56 cents goes to Regional School Unit 13. Another 40 cents goes to Rockland's municipal government for services such as police, fire, and public services. The remaining 4 cents goes to Knox County for the operation of its departments such as the Sheriff's Office, jail, and airport.

Rockland City Manager Tom Luttrell said Monday that $290 of the $310 increase is for the school district.

The school district had a $2.1 million budget increase for 2019-2020 because of higher special education costs and greater health insurance costs.

The state's funding formula has been a problem for coastal districts like RSU 13 for decades. Property values greatly influence how much money districts get from the state. The greater the property value, the less state aid a district receives.

The Maine Department of Education estimates RSU 13 -- which has 1,642 students -- will receive slightly less than $3.8 million in state aid for 2019-2020. This amounts to 12 percent of the overall budget.

Forty-three miles to north, RSU 3, which serves the Thorndike area, had 1,248 students as of last October. The state estimates RSU 3 will receive slightly more than $7.7 million in 2019-2020.

RSU 40 (serving Waldoboro, Warren, Union, Washington and Friendship) is estimated by the state to receive $9.9 million in state aid for the upcoming school year. The district has 1,898 students. RSU 71, based in Belfast with 1,540 students, is projected to receive $8.8 million in state aid next year.

RSU 13 Business Manager Peter Orne has repeatedly maintained that a fairer formula would bring in $3 million more annually to the district.

For the most recently completed full-value tax rate list compiled by the Maine Bureau of Revenue Services, Rockland had the 32nd-highest property tax rate out of approximately 500 cities, towns and townships. The lack of state education aid plays a large role in that placement.

Top taxpayers

DuPont Nutrition USA remains the top property taxpayer in Rockland by a large margin. The company, which operates a carrageenan manufacturing plant on the waterfront on Lime Street, has a total assessment of $34.7 million.

State law, however, exempts $15.3 million of that assessment from local taxes through the business equipment tax exemption program. If not for the exemption, the company would have been billed an additional $378,000 by the city.

DuPont is being billed $479,000 for its taxable property. This is a $39,000 increase from last year.

Central Maine Power is the second biggest taxpayer in Rockland, with an assessment of $13.6 million and a bill of $337,000.

Douglas Dynamics LLC, which manufacturers Fisher snowplows and related equipment in the Industrial Park, is the third-largest taxpayer, with an assessment of $13 million and a tax bill of $322,000.

Douglas is also a beneficiary of the state business equipment exemption program. The company receives an exemption on $10.5 million in property.

The O'Hara Corp. is the fourth-highest taxpayer in Rockland, with properties assessed at $11.5 million and a bill of about $285,000.

Harbor Plaza Limited Liability Co., the owner of the shopping center on Camden Street, has an assessment of $10.9 million with a bill of $270,000. This does not include personal property such as equipment owned by the commercial tenants in the shopping center.

HD Development of Maryland Inc. (The Home Depot) is assessed at $7.2 million with a tax bill of $178,000.

Maine Water is assessed at nearly $6.7 million with a tax bill of $165,000.

Rockland Plaza Realty Corp. is assessed at more than $6.5 million. The owner of the shopping center on Maverick Street is being billed nearly $165,000.

Rockland Harbor Park LLC, which owns the former MBNA office complex on the waterfront now leased by SS&C Technologies Holdings Inc. and the Penobscot Bay YMCA, has property assessed at $6.5 million with a tax bill of $162,000.

And the Breakwater Marketplace on Camden Street is the 10th-highest taxpayer in Rockland, with an assessment of $5.3 million and a bill of $132,000.

The overall value of properties in Rockland is slightly more than $1 billion. But nearly a quarter of that amount ($248 million) is exempt from property taxes.

Most of the exemptions are because the properties are owned by government. The federal government owns property worth nearly $84 million in Rockland, with the Rockland Breakwater, the Coast Guard station, and the federal building accounting for nearly all that amount.

The city owns $41 million of the exempt property. The Regional District 8 Cooperative Board owns $22.5 million for the new career and technical school on the waterfront. RSU 13 owns $8.7 million of the exempt property. Knox County owns $7.7 million, and the state $6.1 million.

There are also exemptions for nonprofit housing developments such as Bartlett Woods ($4.5 million assessment), Methodist Conference Home ($3.6 million), and Summer Street Housing ($2.9 million).

The Farnsworth Art Museum is the largest non-governmental tax-exempt property owner in Rockland, with properties valued at $9.6 million.

If taxed, the Farnsworth would pay $238,000. A 2014 study by Planning Decision Research and Planning found the Farnsworth provided a significant economic boost to the region, with its approximately 60,000 visitors generating about $60 million.

Admission to the museum is free to Rockland residents. The museum also works extensively with the schools at no charge.

State law determines what properties are taxable or exempt. Nonprofit cultural and educational organizations are exempt by state law.

Pen Bay Medical Center has properties in Rockland assessed a total of nearly $8 million. These include the Bok office building and the Knox Center, which are both adjacent to the Rockland Public Library.

Churches are also exempt from property taxes. The value of church properties in Rockland total about $10 million, with Littlefield Memorial Church on Waldo Avenue the highest-valued at nearly $2.9 million.

If taxed, churches would generate about $248,000 in taxes for the city.

Churches provide social services such as soup kitchens to feed people who would otherwise go hungry or need additional government services.

Comments (1)
Posted by: Stephen K Carroll | Aug 16, 2019 08:10

Thinking of getting my real estate license.  With lower than ever interest rates and higher than ever taxes in Rockland, should be lots of for sale signs popping up everywhere.  Most sales will most likely go to the Woodstock generation.  Not many families rushing to enroll their children in RSU #13.  A quarter of a billion dollars (yes billion with a B) of tax exempt property this city has more than it's share of freeloaders.  Lots of finger pointing going on at city hall, so let's promote more spending and another 10 million dollar bond.  Maybe a generous benefactor like the Farnsworth will step forward to help us out.

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