Letters informing residents of anticipated property tax change brought shock to many longtime Portland property owners. This is especially true among residents of the traditionally working-class neighborhood of Munjoy Hill, once considered a less desirable area to live. Here the anticipated property tax increases felt staggering to many.

The overall taxable value of the city of Portland grew by a whopping 77 percent. This would appear positive and no surprise, with the city currently listed among “America’s best places to live.” But skyrocketing (some use the word “insane”) real estate values all across Portland, and especially on “the Hill,” are being driven by outside factors.

Climate change coupled with recent pandemic-driven advances in remote work technology are attracting people from afar to Portland’s livable, easily accessible location with increasingly milder winters. In a trend that we began to see before the pandemic, Portland has also become the affordable Cape Cod, attracting a burgeoning wealthy snowbird population to buy second homes. Developers, preying on such opportunity, spurred increased demolitions and rapid condo construction, in turn inspiring concerned Munjoy Hill citizens to squeak through a recent protective historic district.

Perhaps the significant factor in Portland’s rising residential real estate values has been city planning favoring big commercial development along Portland’s most desirable waterfront peninsula. Residential construction of a walkable waterfront community would have helped to reduce the city’s fast-rising housing pressure. Pre-pandemic “For Lease” signs of commercial space have only multiplied and more office space is scheduled for construction. In response, the city has favored tax relief for commercial property owners, driving down their property values and consequent tax burden and forcing residential taxes to make up the difference. This housing scarcity on the peninsula has driven up peninsula residential real estate prices beyond the means of Portland’s working population, defying Portland’s Plan 2030, the 2017 city comprehensive plan promising equitable, sustainable and fair choices in the best interests of its citizens.

While the rest of Maine may shrug at their largest city’s tax and housing dilemma, Portland is grappling with a disturbing trend occurring throughout the state. Property values are rapidly soaring upward, in part because of wealthy buyers bringing in remote incomes seeking livable communities that were once deemed rural “vacationland” destinations. Maine’s working-class population, a demographic who once chose way-of-life over higher-paying jobs, now finds itself with real estate whose value has been artificially inflated by those with far greater economic means seeking homes in a more habitable climate. This saddles our state’s longtime citizens of modest income with property tax burdens beyond their means, if they are fortunate enough to afford real estate at all.

Maine law deems “100 percent of fair market value” as the guideline for assessing a homeowner’s fiscal responsibility to their municipality. Should Maine now consider an initiative to slow residential property taxation increases, similar to California’s Proposition 13 or Massachusetts’ Proposition 2½? It is long overdue for Augusta to seek to ease longtime Mainers’ property tax burden in light of unforeseen and ongoing change. Portland needs it now. And all of Maine, not just Portland, needs a revamped, equitable and fair property tax system.


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