All Maine Matters

July 2006



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Another Hidden Tax on Maine State Citizens

The Maine State Housing Authority, under the tutelage of Dale McCormick, has formulated a plan to shake down your local oil dealer. I know: Everyone loves to hate the “oil dealer”. However, before you skip gleefully off to another article, you need to continue reading to find out how much of her scheme will eventually come out of your pocket.

First, the Maine State Housing Authority is responsible for the oversight of the Low Income Fuel Assistance Program, known as LIHEAP. Dale’s division racked in $25,000,000.00 from the Feds, $5,000,000.00 from the State’s budget, $5,000,000.00 from Governor Baldacci’s friend President Chavez of Venezuela. After crying poverty she scored another $9,000,000.00 compliments of Susan and Olympia, which turns out to be an advance off next years $25,000,000.00.

Have you ever heard the saying “Some for the bulls, some for the bears, and none for the pigs?” Well, you have this now. Instead of doling out the same amount of money that LIHEAP recipients had come to expect and then wait for those individuals to ask for more, our state’s “high rollers” just issued a lot more money to each recipient. Keep in mind that the Northeast experienced one of the warmest winters on record, and a lot of these LIHEAP recipients have sizable LIHEAP credits sitting on their heating oil accounts. You would think the State would say, “Okay, any money that hasn’t been used, send it back to the State so we can redistribute it next year” Nope, the State has told the oil dealers to just keep it on those accounts, and they don’t need it back.
Psst…Only people who have too much money would say that.
Okay…here’s the shake down: The State of Maine wishes to do to the oil dealer what they did to your local pharmacist. In the future, the State will not reimburse the oil dealer a $1.00 for a $1.00 of oil delivered. They will establish a lesser reimbursement amount for LIHEAP deliveries based on the State’s expert opinion.

Who pays for this forced discount or cost shift?

Yes, you --the average citizen of Maine -- are likely to pay again to support your less fortunate neighbors. How? By forcing dealers to charge less than they need to make in order to pay their employees, keep the trucks rolling, pay taxes, and perhaps make a return on their hard work. The dealers are either going to have to reduce wages, reduce benefits to employees, reduce investment in Maine, and/or increase the costs of the products they sell.

That is where you -- the average citizen -- come in. You will pay more through higher prices in order to offset the forced subsidization of the LIHEAP customer.

You already pay the taxes that provide the LIHEAP benefit. Now the state is going to charge you again, except this time without you having any say.

This is a new method of taxation without representation. The state simply says you can only charge this class of citizens this amount. Therefore, everyone else needs to make up the difference from what it really costs. In order for an oil company to stay in business it has to be able to make a certain amount of money. Every sale contributes to covering a wide range of expenses.

This strategy has been played out before, and has had dire consequences for the locally-owned pharmacies in Maine.
Additionally, this has similarities to the Dirigo Health Insurance program. Again, offer a program to the uninsured, subsidize those folks so that they can afford it, and then place a 4% surcharge on everyone else’s policy in order to help pay for it.

This slippery slope is getting slipperier and will eventually encompass other programs like food stamps, Section Eight Housing, and the like. Make no mistake. This is a hidden tax, and they’re hoping that that the average Maine citizen isn’t paying attention.


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