Carol Carothers stands in front of Belgrade Town Office Wednesday. Carothers has gathered 270-plus signatures on a petition that aims to create a tax credit program for homesteaders and require advanced notice before new spending proposals. Anna Chadwick/Morning Sentinel

BELGRADE — Town officials are working to revise an article proposed in a citizens’ petition signed by more than 250 residents after unanimously voting it down last month.

The petition, dubbed the “Town of Belgrade Property Tax Fairness Ordinance,” had three primary goals: Establish a $2.5 million “local homestead benefit” program, require town officials to publish advance notice of new spending proposals, and prohibit the town from publishing names of delinquent taxpayers.

Officials say the town would need to take out loans to finance the proposed homestead program.

The Board of Selectpersons unanimously voted down the initial proposal at its July 16 meeting saying it violated state law, which requires municipalities to publish the names of property owners who are late paying taxes.

“We can’t change anything. The petition’s here, we have to do the whole thing,” Board Chairperson Carol Johnson said at the July 16 meeting. “Perhaps we’ll look to come back in 60 days with an ordinance that we work on with the budget committee so we can have it ready for town meeting to put forward.”

Board members gave themselves until Sept. 14 to address legal concerns and present a counterproposal.

The petition was organized by Carol Carothers, a 71-year-old Belgrade resident who says she was compelled to begin circulating the petition to benefit Belgrade residents on fixed incomes after a spike in property taxes and the end of a senior-focused tax benefit program.

Belgrade’s rising budget brought a 17% increase to taxpayers last year, town officials said, while tax bills from Kennebec County rose 28%.

“Maine is the oldest state in the nation. There’s a fair number of seniors everywhere, and we live on fixed incomes,” Carothers said. “For seniors whose incomes are flat, this steady increase year after year, plus inflation — it all takes a toll.”

Carothers’ proposal would allow residents with homesteads making less than 350% of the federal poverty line to apply for tax credits through the town if their property taxes were greater than 8% of their annual income. The amount of aid provided would vary depending on each homestead’s income.

The petition was modeled after Maine’s statewide Homestead Exemption Program, according to Carothers. That program can reduce permanent residents’ taxable property assessments by up to $25,000, which is intended to reduce the burden of property taxes.

If passed, the article also would require the town to publish notices of new spending proposals 60 days before such proposals are voted on, along with “the specific reasons” the town needs the funds and “if the spending will increase property taxes.”

Municipal officials have been looking at other towns with similar ordinances, such as Freeport, for a legal framework to follow in creating the homestead benefit program.

Regardless of what the board comes up with, Belgrade does not have the funds needed to pay for the homestead credits, Town Manager Lorna Dee Nichols said at the July 16 board meeting.

“We don’t have $2.5 million to pull from undesignated (funds),” she said. “We would have to take out a loan in order to fund (the program) or pay our bills.”

The $2.5 million would be a one-time injection of cash into the program, Carothers said, along with any tax surplus collected that exceeds 3% of the annual municipal budget.

Still, appropriating that money would require an increase in property taxes across the board, town officials say, which may defeat the purpose of the petition.

The petition is a push for transparency, Carothers said, and a response to a rapid increase in property taxes for her and other residents in recent years. The Legislature’s repeal last year of a one-year “Senior Property Tax Stabilization” program inspired Carothers to draft the petition, she said.

The program, originally enacted in 2022, had allowed Maine residents over the age of 65 receiving a state homestead exemption to freeze their property taxes at last year’s level, regardless of income.

Legislators ended the program after just a year due to massive budget overruns and concerns from some legislators that it was passing the cost of high-income property owners’ taxes on to middle- and working-class Mainers.

Officials had initially expected the state to disburse about $2 million through the program, but the actual cost ended up being more than $25 million, according to Maine Revenue Services.

Carothers, however, said the proposed Belgrade homestead program would largely benefit the middle class by allowing homesteaders within 350% of the federal poverty line to apply for a tax credit.

“There are lots of programs for people who are lower income, but there’s very little help for middle-income folks,” Carothers said. “I made it 350% because I want middle-income folks to be counted.”

It’s unclear how many Belgrade residents could qualify for or receive benefits from the program, Nichols said.

The town gave out just over 1,000 homestead exemptions this year, she wrote in an email, but “the town does not have any way of knowing how many could or would apply at this time.”

While it remains unclear what revisions are being made to the petition, a revised version will be presented by the Board of Selectpersons at its Sept. 17 meeting, Nichols said.