The greatest need in economics today is for information. Awash in a stormy sea of more data than has ever been available, economists and the policymakers they seek to advise are splashing around ever more desperately for some solid information to grasp.

The numbers that formerly provided solid reasons for making policy decisions – unemployment, inflation, production, trade – all seem, when examined more carefully, not to mean what they used to. As a result, policy decisions don’t seem to work as they were intended.

At the national level, this problem is most clearly evident at the Federal Reserve. Witness this past Friday’s nearly 400-point drop in the Dow Jones stock index.

The Fed’s confused efforts to project where labor markets and prices are going and to understand how those variables relate to their efforts to affect interest rates have made businesses hesitant to spend and investors skittish about asset values.

Since the end of the Great Recession in 2009, the Fed has consistently overestimated the future growth of the U.S. economy, thus rendering us all more vulnerable to financial collapses caused by forces we won’t understand until it is far too late to do anything about them.

In Maine, the topic comparable to growth and interest rates at the national level is property tax burden and tax reform. Nowhere at the state level is the need for understandable data and a clear sense of what they mean more evident than the complex links between fiscal decisions in Augusta and the tax bills that greet Maine property owners each year.

In this regard, I tip my Teddy Roosevelt Rough Rider fedora to the good people at Maine Revenue Services as I plunge into the thicket of the Municipal Full Value Tax Rate Report in search of information that might inform more effective local tax policies. Since my point here is to emphasize the fact that good policies depend on good data (meaning information that is readily available and widely understood), I will devote the balance of this column to explaining the data and leave some general interpretive comments for next week.

Each year, the government of each Maine municipality must submit an assessment report – the municipal valuation return – to the state. This report “lists the total assessments of local property and collection of (property) taxes … in the jurisdiction.” The reports are compiled at Maine Revenue Services and subject to “a sales ratio study that measures the assessed value of residential and certain commercial properties relative to their actual selling price.”

This process, which takes up to 18 months, results in a report that Maine Revenue Services must submit to the secretary of state by Feb. 1 of each year, certifying “the full equalized value of all real and personal property which is subject to taxation under the laws of Maine.”

This is the so-called state valuation, used by state government to allocate education subsidies and the revenue-sharing program that sends a portion of state sales and income tax revenues to municipalities. It is also used by county governments to distribute program costs to member municipalities.

In short, understanding how state valuation data are obtained and used is critical to understanding how municipal taxes are determined, what their relative burdens are from community to community, and how various proposals for tax reform are likely to affect the local property tax burden.

The most recent state valuation came out this year and is based on municipal valuations submitted by local assessors on April 1, 2014, and adjusted by Maine Revenue Services officials. The municipal full value tax rate, therefore, is the total dollar value of the property tax commitments made by local officials to fund their 2014 budgets, taken as a percent of the 2016 state valuation.

In an effort to make the resulting tax rates more truly comparable across towns, Maine Revenue Services makes two additional adjustments.

• It adds back into each municipality’s tax base any amount excluded under Tax Increment Financing programs (nearly $3.8 billion, or about 2.3 percent of total valuation).

• It adds back to each community’s property tax commitment any reimbursement made by the state to a municipality under the homestead reimbursement and the business equipment tax reimbursement programs.

The result of all this effort to turn complexity into simplicity is two numbers and the ratio between them. The real value of all the property available to tax by Maine municipalities in 2014, as certified by Maine Revenue Services in 2016, was just over $162.8 billion. The total tax spending voted by all Maine municipalities to be paid for by taxes applied to that property in 2014 was just under $2.4 billion.

The overall property tax rate in Maine in 2014, therefore, amounted to $14.72 per $1,000 of assessed value. Over the 490 taxing entities listed by Maine Revenue Services, the tax rate ranged from a high of $32.02 in Millinocket to a low of 62 cents in Garfield Plantation.

These are the data to which we must look if we are to understand and address in any serious way the issue of property tax reform in Maine.

Charles Lawton is chief economist for Planning Decisions, Inc. He can be contacted at:

clawton@planningdecisions.com