Dow believes lower taxes important to spur economic growth

Thu, 10/01/2020 - 8:00am

    Since 2004, Dana Dow has served five terms in the Maine Legislature. He was elected four times to the senate and served one term in the house. But his last term was significantly different than the others. Dow was elected Maine Senate Republican leader by his colleagues in 2019. In 2020, the legislative session was cut short due to the COVID-19 pandemic. This fall, Dow is seeking re-election against first-term Maine House District Rep. Chloe Maxmin, D-Nobleboro. 

    Whoever wins faces a series of difficult decisions on how Maine escapes the financial problems caused by the pandemic. Dow described the  pandemic’s economic aftermath as overwhelming. “The shortfall is about $525 million now, and it could reach $1.4 billion over the next two and half years. Once you eat up all the low-hanging fruit, the Legislature will have their work cut out for them, whoever is elected.”

    For Dow, the problem with Maine’s economic problems runs deeper than COVID-19. Dow believes Maine’s economy lags behind other New England states and the rest of the country for one reason; Taxes. Dow recalls in 1966 Maine established an income tax and, by 1970, residents began leaving the state in alarming numbers. “Aroostook County has lost 40,000 people. Our tax system hurts our economy,” he said. “Our lowest rate of 5.8% would be the top rate for many states. For decades, people have struggled to make a living, and I think taxes play a big part of it.”

    Unlike Maine, neighboring New Hampshire has no state income or sales tax. But Dow doesn’t want to duplicate the Granite State’s tax policy. Dow prefers the North Carolina model which he said nearly a decade ago reduced corporate and income taxes and attracted 750,000 more people. “Companies moved into the state and families followed. North Carolina has the lowest corporate rate in the country. I favor a gradual approach by cutting rates in stages. If the tax revenue doesn’t follow, I would pause it,” he said.  

    While Aroostook County has the most dramatic population reduction, Dow said it’s a problem throughout Maine. Dating back to 1970, Dow said Maine had approximately 250,000 kindergarten through grade 12 students. “We now have about 180,000. That means younger families are moving out, and leaving Maine as the oldest state.”

    In handling the pandemic, Dow believes Gov. Mills should have re-opened the state sooner. He described Massachusetts “day-trippers” as critical to the coastal tourism economy and believed they should have been allowed back earlier than Aug. 1. “Massachusetts (COVID-19) rates were lower than New Hampshire’s and Vermont’s, but (people from Massachusetts) were still kept out until August. I don’t understand why,” he said. 

    Another Mills decision he doesn’t understand was what he said was an apparent lack of communication between the executive and legislative branches. Legislators battled over whether or not to call for a special session last spring. Democrats wanted to discuss emergency health guidelines and complete unfinished legislative business. Republicans would only return to discuss pandemic-related policies. “There was a lack of communication between the governor and legislators. In fact, the silence was deafening. If she thought it was a big enough emergency, she probably would’ve called us back,” he said.

    In 2016, Dow returned to the state Senate by defeating incumbent Chris Johnson (D-Somerville). His victory gave the GOP a one-seat majority. Dow worked in bi-partisan cooperation to pass a tax conformity bill to make state tax regulations conform with new federal guidelines. “This was a controversial issue with strong views on both sides, but in the end, it all worked out. There were unanimous votes in both chambers,” he said.

    In 2020, Dow beams when he discusses his work on a solar power bill. The legislation expanded solar projects’ investors from a maximum of five to 200. “They call it the ‘Dow Bill.’ It took the handcuffs off the projects, and it put Maine on the solar power map. I heard it’s going to save Maine hospitals $1 million per year in electricity costs,” he said. 

    In the next legislature, Dow believes it time for Maine to get serious about broadband expansion. He described past efforts as being too small to meet the state’s needs. “A $15 million bond doesn’t really do much. We need to think bigger, probably a $60 million bond is what we need,” he said.

    Dow lives in Waldoboro. Besides his legislative experience, he has owned Dow Furniture, since 1977. Dow also spent 11 years teaching high school physics and chemistry. He is married and has four children. He attended Waldoboro and Medomak Valley High Schools. In 1973, he graduated from the University of Southern Maine with a teaching degree.