Payment in Lieu of Taxes – Kate Sykes for District Five

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Friday, September 12 2025

ONE BIG THING: Sharing the Responsibility for Portland’s Future

Last night, the Finance Committee had two big conversations about how we pay for City services: the Portland Senior Tax Equity Program (P-STEP) and the Payment in Lieu of Taxes (PILOT) Program. Both are about making sure the responsibility for funding our City is spread fairly, so that no one group is left carrying more than its share.

What Happened

The P-STEP Program was created in 2017 to help seniors—both renters and homeowners—who were struggling to keep up with rising housing costs tied to property taxes. The program was designed this way because state law recognizes that whether you rent or own, property taxes affect your housing costs. What many people don’t realize is that the state law enabling this program allows municipalities to design it for seniors, but does not require it to be limited by age. In other words, Portland could choose to expand this type of relief to younger residents as well. In the last couple of years, P-STEP has reached more households than ever, which tells us the need is growing. That success raises a bigger question: should this kind of relief be available to younger families too? After all, the rising cost of housing isn’t just affecting seniors.

We also discussed a revised draft framework for two approaches: a voluntary PILOT Program, and a municipal service charge. The service charge is authorized under state law (Title 36, section 508) and applies only to a narrow category of tax-exempt properties—those that generate rental income, but are otherwise exempt from property taxes. The law has been on the books since the 1970s, but Portland has not previously used it. It is mandatory rather than voluntary, but because it applies to a much smaller pool of properties, it would not replace a broader PILOT framework. Instead, Portland could use the service charge in conjunction with PILOT, ensuring that nonprofits benefiting from rental income, along with larger institutions like hospitals and universities, all contribute something toward the City services they rely on.

Why It Matters

Think about two neighbors on the same street. One is a retired senior who depends on a fixed income, and the other is a young family with kids in school. Both are facing rising costs, and both need the same services: safe roads, reliable emergency response, and schools that prepare the next generation. Expanding P-STEP to all ages would mean that both of those households could get help shouldering the cost of staying in their homes.

Or take another example: when a fire truck rolls out of the station, it doesn’t stop to check whether the property it’s headed to is taxable. Hospitals, colleges, and large nonprofits get the same protection and use the same infrastructure as everyone else. A PILOT Program would mean they contribute a small share back into the system that keeps their doors open and their staff and patients safe.

These aren’t abstract policy debates; they’re about whether Portlanders—young or old, homeowner or nonprofit—are all pitching in together to keep our community strong.

What Comes Next

The Finance Committee will keep working on both proposals this fall. No decisions have been made yet, but these conversations are setting the stage for policy changes that could have a real impact on households across the city.

ksykes@portlandmaine.gov 207-558-5764

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Friday May 30, 2025

ONE BIG THING: Understanding Your Property Revaluation Notice

Many of you have received your new property assessment from the City and are understandably concerned. I’ve heard from constituents whose property values have gone up significantly, and they’re worried that this means their taxes will skyrocket.

Let me explain what’s actually happening.

When the city revalues all properties, it resets the estimated market value of every parcel of land in Portland. This year’s revaluation increased property values across the city to reflect current market conditions, but the overall amount of money the City needs to raise through property taxes doesn’t change because of revaluation. Instead, the mill rate (the tax per $1,000 of value) is adjusted downward, and what changes is how that burden is divided among property owners.

Here’s an example:

Before revaluation: Your home was valued at $350,000 and the mill rate was $20 per $1,000.
→ Your tax bill was $7,000.
After revaluation: Your home is now valued at $500,000—but the new citywide mill rate drops to $14.
→ Your tax bill is still $7,000.

This means that even though your assessed value went up, your tax bill might stay the same—or even go down—depending on how your home’s increase compares to the citywide average.

If your property went up less than the citywide average, your taxes could go down. If it went up more than average, they could go up—but not necessarily by the same percentage. We won’t know final tax bills until the new mill rate is set in August, after the City Council passes the FY26 budget.

I want to be clear that I’m committed to tax fairness and balancing the city budget—but not on the backs of working families, seniors, and people living paycheck to paycheck.

That’s why I’m working to:

Expand Portland’s Senior Tax Equity Program (P-STEP) to more residents, regardless of age.
Launch a PILOT program asking large nonprofits to contribute their fair share.
Strengthen financial oversight of city spending to ensure transparency and accountability.

I’ll be advocating for these ideas in the Finance Committee. In the meantime, if you have questions about your revaluation notice, you can contact Tyler Technologies at 1-844-651-3398 or visit tylertech.com/portland.

ksykes@portlandmaine.gov 207-558-5764

Wednesday May 21, 2025

ONE BIG THING: Shaping UNE’s Growth in District 5

This week, the Council approved the University of New England Institutional Overlay Zone (IOZ), granting UNE long-term development rights over more than 70 acres in the Deering neighborhood. The zone creates a cohesive plan for UNE’s Portland campus and opens the door for projects like student housing for the medical school, transforming what has long been a commuter campus into a vibrant residential hub. It ensures that future development happens within a shared vision, not parcel by parcel.

Councilor Bullett and I also introduced an amendment—passed unanimously—to expand environmental protections along Capisic Brook, permanently safeguarding water quality and green space in one of Portland’s most climate-vulnerable watersheds.

At the same meeting, I introduced a resolution urging the Council’s Finance Committee to finalize a long-overdue PILOT (Payment in Lieu of Taxes) policy to address the growing footprint of Portland’s tax-exempt institutions.

Why It Matters

The UNE IOZ marks the third major zoning entitlement on tax-exempt land in recent years, following approvals for MaineHealth and the Roux Institute. These institutions now occupy vast sections of the city but are exempt from paying property taxes toward the infrastructure and services that sustain them. They benefit from zoning approvals, public infrastructure, emergency response, and long-term planning, but the cost is shifted onto working people, renters, and small businesses.

According to the City Assessor’s Office, approximately $3 billion in Portland property is currently tax-exempt, representing over 20% of the City’s potential tax base.

Meanwhile, property taxes are climbing. School budgets are growing. State reimbursements are uncertain. We are asking more from Portlanders while allowing some of the city’s largest landholders to grow without giving back.

A PILOT program offers another way, one that treats growth as a shared civic responsibility. It’s a model where prosperity is reinvested in the communities that make it possible, and it works in other cities.

Boston’s PILOT program generates over $30 million annually, using a fair formula based on property value and municipal service use, with credits for real community benefit. Portland has drafted a similar framework, but has yet to enact it.

It’s time to move forward with a model that matches our values and invests in our shared future.

Four Quick Hits

School Budget Passed: We protected vital school programming under fiscal pressure. A win for stability and equity.
Brighton Ave RFP Approved: The Council advanced affordable housing on city-owned land near the Barron Center. The debate, whether to prioritize family or elder housing, revealed how austerity forces us to choose between needs. I look forward to exploring new tools to build public equity in housing through the Social Housing task force so we can build housing for everyone.
Cannabis Loopholes Fixed: Retailers can now prepare non-alcoholic beverages onsite. A simple change that helps small businesses thrive on equal terms.
Minimum Wage Ballot Initiative Moves Forward: The Housing & Economic Development Committee approved a ballot measure that would finally include City workers, ending their exclusion from the 2020 wage hike and taking a stand for wage equity across sectors.

What Comes Next

The minimum wage initiative is a step toward fairness. But already, we’re seeing calls to carve out nonprofit employers, a move that would recreate the very inequity we’re trying to correct.

Let’s be clear: under that amendment, someone washing dishes in a non-profit senior home could be paid less than someone doing the same job in a restaurant—same work, same hours, less pay—just because of who signs the paycheck.

This is the logic of austerity: divide workers by sector, business size, or job title, and ask them to fight over what’s left.

But we know another way.

We can build a city where no one is carved out. Where wages are dignified, housing is abundant, and growth is shared. The work continues, and we’ll keep doing it together.