By Senator Trey Stewart
AUGUSTA – For years now, Maine’s median age has crept upward as one of the largest segments of our population has shifted into their retirement years. According to the U.S Census Bureau, about 276,000 people in Maine are aged 65 and older, and another 210,000 or so of the state’s 1.3 million residents are poised to join the retirement ranks within the next 10 years.
And when people reach retirement age, they’re left with a choice of whether to continue working – albeit perhaps with a different employer – or enjoy their later years with a degree of leisure. These choices are often influenced by outside or “environmental” factors such as the economy, access to adequate savings and/or retirement income and their family situation, among others.
Sometimes such decisions are made more simplistically where you might think it’s merely time to hang it up and leave the rat race behind to go play golf. Or, you may realize that you need to work just a little longer to round out the nest egg you’ve been building your whole life.
Regardless, once the decision to retire is made, it’s often a life-changing one that will affect you for the rest of your years. Problems arise, however, when the foundation upon which the decision is based shifts out from underneath it.
There’s an old Latin concept called “ceteris paribus” that’s still used today in economics. I’m sure you’re familiar with the notion where we can determine the relationship between two dynamic variables under the assumption of all other things being considered equal or constant. When it comes to retirement decisions, the same holds true – the two factors considered most often are simply what any projected fixed income will be and the expenses that will be incurred along the way, with all other things being equal.
Yet that’s not the environment we’re living in today. With inflation for basic necessities at 40-year highs, the price of heating oil and gasoline running $2 more per gallon than a year ago, ever-rising health care costs and a tax burden that only keeps growing, it’s easy to see how seniors are under severe duress as expenses grow out of control.
Republicans led efforts this year to help seniors in this untenable, unsustainable environment. First, we increased the retirement income exemption to shield up to $25,000 from state income taxes. This brings Maine into parity with other states that often attract retirees due to their more favorable income tax structure, and that exemption will increase to $35,000 by 2025.
The Legislature also invested heavily into senior care, including 600 more home-based care assistance slots, over $160 million for our nursing homes, long-term care and direct care facilities over the biennium, millions more to save our Maine Veterans’ Homes in Caribou and Machias, and a cost-of-living adjustment for 37,000 state retirees.
Yet one of my greatest achievements this session was introducing legislation to join Connecticut and Rhode Island in freezing property taxes for qualified seniors to help keep them in their homes.
Despite increasing State revenue sharing to municipalities to help offset property tax increases, Maine cities and towns are increasing them anyway at a rate not seen in decades. Some seniors are reporting that their property taxes have doubled as municipalities are finding budgetary windfalls through “revaluations” that have only been artificially exacerbated by the hyper-inflated housing market that has also fueled our affordable housing crisis.
While the Legislature cannot control property taxes at the local level, such situations certainly corroborates the need for the protections of this particular property tax stabilization program, which was funded entirely by Republicans. Unabated rises in property tax burdens are in fact the greatest threat facing seniors amid an environment of fixed incomes and rampant inflation.
At a time when our state’s most vulnerable population is facing so many uncertainties, I and my fellow Republicans stand ready to do more today and in the next Legislature. Our seniors are depending upon it.
Senator Trey Stewart is in his first term representing the Aroostook County and Penobscot County communities of District 2. He is the Senate Republican Lead for the Health Coverage, Insurance and Financial Services Committee, as well as the Energy, Utilities and Technology Committee.