LINCOLNVILLE — The Select Board in Lincolnville has a full agenda to address Monday evening, April 14, including a conversation about the possible federal elimination of municipal tax-free exempt bonds. The matter has been raised by the Maine Municipal Association, which circulated an alert to elected officials, municipal finance directors, tax collectors and treasurers in late March.

The alert comes on the heels of a National League of Cities notification that Trump Administration economic advisors are considering elimination of the tax exempt bond practice to save $250 billion, according to the MMA letter.

"Tax-exempt municipal bonds were written into the first tax code in 1913 and are a well-established financing tool," the NLC said, at its website. "They are debt securities issued by state and local governments to fund public projects. These bonds are unique because the interest earned by investors is typically exempt from federal income taxes, and often from state and local taxes, as well."

According to the Internal Revenue Service, "The Supreme Court first considered exemption of the interest on state and local obligations (“municipal bonds”) in 1895."

The NLC said Congress in the past has tried to remove the tax-exempt status to help pay for different tax measures or policies. The NLC is concerned, "that next year’s sunsetting Tax Cut and Jobs Act of 2017 provisions and ballooning national debt will threaten tax-exempt municipal bonds once again. "

According to MMA, the Maine Municipal Bond Bank financed tax-exempt projects last year that amounted to $9 million in improvements, "that without the tax-exempt status, borrowing costs would increase by 25 to 50 percent, translating to millions more paid by property taxpayers."

MMA is encouraging towns and cities in Maine to contact their Congressional delegation and urge them to advocate for the federal tax exemption. The NLC is encouraging municipal councils and Select Boards to pass resolutions in support of the tax-exempt financing practice. 

In his pre-meeting memo to the Lincolnville Select Board, Town Administrator noted that Lincolnville has benefited from tax-exempt bonds for the school construction loan, as well as for road work.

"The road work bond has been paid off and the school borrowing is nearly paid off," wrote Kinney. "That said, at some point in the future it is likely that the Town will seek to bond another project and if so it would be financially beneficial to have the option of the tax exemption."

In Other Town Business

The Lincolnville Select Board will decide whether to approve paving the parking lot at the library in Lincolnville Center, and whether to approve a request from Peter Willcox, of Islesboro, to install a wave buoy at Lincolnville Harbor.

The purpose of the buoy is to assess the wave action of the ferry terminal expansion. That goal grows out of the ongoing concern by Islesboro and other Penobscot Bay islands serviced by Maine State ferries to tie the ferries overnight on the mainland as opposed to the current practice of keeping them on the islands overnight.

In an email to Kinney, Willcox said the Ferry Advisory Board is opposed to changing the overnight plans and is concerned about problems it could create for Lincolnville.

"Among our worries is that Lincolnville is not a suitable location for a ferry in a southerly wind," he wrote. "We do not think the wave attenuation device, as was installed in Islesboro, will be adequate."

Willcox said the University of Maine is willing to install a wave buoy to measure wave heights. The buoy would remain in Lincolnville Harbor for a year. He said the buoy ideally would be installed next to the ferry pen, and that he would talk with the ferry captains about location, as well.

At the April 14 meeting, the Select Board will also consider signing an agreement with the Midcoast Council of Governments to help update the town's 2006 Comprehensive Plan. The cost would be up to $24,565.

Monday's full agenda follows:

1. Administrator’s Report

2. Meetings & Announcement:
   Comprehensive Plan Review Com. Wed. 04/16 6:00PM
   Patriot’s Day Mon. 04/21
   Select Board Workshop Tues. 04/22 6:00PM
   Lakes & Ponds Committee Tues. 04/22 7:00PM
   Budget Committee Public Hearing Wed. 04/23 6:00PM
   Conservation Commission Thurs. 04/24 4:00PM
   Select Board Mon. 04/28 6:00PM

3. Upcoming Community Events

4. Meeting Minutes

5. Liquor License Renewal Application – McLaughlin’s Lobster Shack

6. Library Parking Lot Paving – Lincolnville Community Library

7. Wave Buoy Installation Request – Peter Wilcox

8. Approval of Comprehensive Plan Consultant Agreement

9. Board, Committee, and Commission Appointment(s)

10. Request for Overweight Vehicle Permit – Christa Boody, Moody Mountain Road

11. Ferry Terminal Project – Correspondence Follow-up

12. Acknowledgment of Investment Objective of Town’s Reserve and Trust Funds

13. Discussion regarding Legal Counsel

14. Maine Municipal Association – Action Alert regarding Tax Exempt Bonds

15. As Board of Assessors – Certified Ratio Declaration

16. Selectperson Update(s)

17. Treasurer’s and Payroll Warrant(s) – Approve & Sign

18. Adjourn