Focus on… Question 2

Editor’s note: Through this week we are providing the list of ballot questions, a bit of background and explanation for the Tuesday, Nov. 3 statewide election. This page focuses on Question 2.

Question 2: An Act to Decrease the Automobile Excise Tax and Promote Energy

Type of question: Citizen initiative – this referendum question attempts to enact a bill proposed by a citizen. If the majority of voters cast “yes” votes, the bill would become state law.

Proposed by: Roy Lenardson, Scarborough

Wording on ballot: Do you want to cut the rate of the municipal excise tax by an average of 55% on motor vehicles less than six years old and exempt hybrid and other alternative-energy and highly fuel-efficient motor vehicles from sales tax and three years of excise tax?

What it does: This question seeks to modify the excise tax; money which is collected by local municipalities for use in the town budget, typically for road maintenance. The tax was first instituted in 1929 and is based off of the vehicle’s Manufacturer’s Suggested Retail Price, also known as the “sticker price.” In the first year, the tax’s mil rate is set at .0240, meaning a $20,000 automobile would equate to a $480 excise tax. The excise tax then decreases each year, as shown below:

YEAR 1  .0240 mil rate
YEAR 2  .0175 mil rate
YEAR 3  .0135 mil rate
YEAR 4  .0100 mil rate
YEAR 5  .0065 mil rate
YEAR 6+ .0040 mil rate 

If question 2 passes, the tax would decrease the excise tax on newer vehicles. Specifically, new vehicles would pay half of the current excise tax in year one, less than half in year two, less than a third in year three and be at the current minimum excise tax in year four. If the question passes, the $20,000 automobile would now garner an excise tax of $240 in the first year. The new mil rates are shown below:

YEAR 1  .0120 mil rate
YEAR 2  .0080 mil rate
YEAR 3+  .0040 mil rate

The bill has a second component as well, designed to encourage the purchase of hybrid vehicles. A hybrid vehicle, utilizing either electricity, hydrogen or some other kind of fuel cell, which receives at least 40 miles to the gallon (highway), would be exempt from all sales taxes (5 percent in Maine) and the excise tax for the first three years. After that, the excise tax would be set at a mil rate of .0040.

Supporters/Opposition: Question 2 is supported by a coalition called More Green Now. It is not opposed by a unified coalition, but by a variety of organizations including Maine Can Do Better.

Supporters of a “yes” vote say: Supporters of this say that the change will return a substantial amount of money to taxpayers, with estimates ranging from $70 million to $80 million, while reducing the state’s excise tax, which is the seventh highest in the nation. Supporters of the hybrid portion of the bill say that the change will encourage people to purchase environment-friendly vehicles.

Supporters of a “no” vote say: Those against this change include local municipal officials; in Franklin County for instance, the selectmen in Farmington, Wilton and Jay all passed resolutions against Question 2. Town officials in these three towns say that the lost revenues (Jay, for example, says it would lose roughly $276,000, annually) would need to be made up either through property tax increases or reductions in service.

The complete listing of questions for the Nov. 3 election, in order, appears below.

Question 1 (People’s Veto Question): “Do you want to reject the new law that lets same-sex couples marry and allows individuals and religious groups to refuse to perform these marriages?”

Question 2 (Citizen Initiative): “Do you want to cut the rate of the municipal excise tax by an average of 55% on motor vehicles less than six years old and exempt hybrid and other alternative-energy and highly fuel-efficient motor vehicles from sales tax and three years of excise tax?”

Question 3 (Citizen Initiative): “Do you want to repeal the 2007 law on school district consolidation and restore the laws previously in effect?”

Question 4 (Citizen Initiative): “Do you want to change the existing formulas that limit state and local government spending and require voter approval by referendum for spending over those limits and for increases in state taxes?”

Question 5 (Citizen Initiative): “Do you want to change the medical marijuana laws to allow treatment of more medical conditions and to create a regulated system of distribution?”

Question 6 (Bond Issue): “Do you favor a $71,250,000 bond issue for improvements to highways and bridges, airports, public transit facilities, ferry and port facilities, including port and harbor structures, as well as funds for the LifeFlight Foundation that will make the State eligible for over $148,000,000 in federal and other matching funds?”

Question 7 (Constitutional Question): “Do you favor amending the Constitution of Maine to increase the amount of time that local officials have to certify the signatures on direct initiative petitions?”