Maine lawmakers still wrangling over state budget

Yahoo

5 days ago

Jun. 1—Maine's legislative sessions is scheduled to end in just over two weeks, and many of the biggest issues remain unresolved.
Lawmakers still must close out a two-year state budget that could include tax increases and spending cuts to settle thorny policy issues ranging from transgender athletes to immigration enforcement to child-care funding.
Finalizing the budget is going to be the biggest hurdle and likely will come down to the wire after some marathon days of negotiation and debate.
Democratic lawmakers passed a portion of the state budget earlier this session with enough funding to continue basic services into the new fiscal year that starts July 1. But they left unresolved proposed tax increases and program cuts the Mills administration says are needed to meet the state Constitution's mandate for a balanced budget. They took a similar approach two years ago.
Republicans, who have criticized Democrats for using their majorities to adopt baseline budgets without their input, are not keen on helping Democrats dig themselves out of a projected budget hole, especially if it includes tax increases. Democrats will need some Republican support for the remaining pieces of the budget to take effect in July.
Lawmakers from both parties say they're aiming to conclude the session by June 18. They will need to approve a budget before they adjourn for the year, but they have the option of carrying over until next year any remaining bills, including about 100 spending bills that have passed both chambers and are awaiting funding before being sent to the governor.
Gov. Janet Mills is expected to meet with a bipartisan group of lawmakers next week to urge Republicans and Democrats to agree to a bipartisan budget — one that makes "tough choices" that protect core services at a time when state revenues have begun to level off and decline and as federal funding becomes increasingly uncertain under the Trump administration and the Republican-controlled Congress.
"The Governor believes that with state revenues leveling off — and cuts likely coming from the President and Republicans in Congress — the time for hard budget decisions is here and now," spokesperson Ben Goodman said. "She continues to strongly urge Republicans and Democrats in the Legislature to work together to make the tough choices that are needed to ensure programs that keep Maine people healthy, our school children fed, our communities safe, and provide access to education and good-paying jobs are maintained in the years to come."
Rep. Jack Ducharme, the lead Republican on the Appropriations and Financial Affairs Committee, which is reviewing the budget, said his party is largely in the dark as Democrats debate among themselves about any changes to Mills' budget proposal. Committee Republicans have refused to support of many budget items until Democrats present a plan for new spending and revenue sources, he said.
"We're really kind of the mercy of what they're going to bring to the table and what they're not," Ducharme of Madison said. "To date, they have not come up with an idea about where they're getting the money."
In a written statement, Sen. Peggy Rotundo, D-Lewiston and co-chair of the budget committee, accused Republicans of not engaging in negotiations. Rotundo said lawmakers have routinely passed bipartisan budgets in her 19 years in elected office, though her statement did not acknowledge that Democrats, who have controlled both chambers since 2019, have passed mostly partyline budgets in recent years.
"What has always made Maine's government work, regardless of who holds the majority, is the understanding that governing is a shared responsibility." Rotundo said. "It requires both parties to come to the table, roll up their sleeves, and work through challenges together."
Earlier this session, Democrats used their majority to pass an $11.3 billion continuing services budget that continues to fund 55% of public education and provides $122 million to help stabilize the MaineCare program. But that budget doesn't include at least $122 million in additional funding needed to fund MaineCare — Maine's Medicaid program — in the second year of the budget.
The governor's budget office said that the continuing services budget does not include $285 million in additional spending originally proposed by Mills.
It's unclear exactly how much money is or isn't left for lawmakers to spend. Ducharme says the continuing services budget already spends $100 million more than state revenue projections over the next two years, which when coupled with the additional MaineCare spending has created a hole of more than $200 million.
But Rep. Drew Gattine, D-Westbrook and co-chair of the budget committee, said there is more than $120 million in unallocated revenue available for the next biennium. That does not include any of the additional taxes or spending cuts proposed by Mills, he said.
Gattine said that lawmakers will likely alter the governor's proposal, though he didn't provide any specifics.
"The budget will be different than what the governor proposed — it always is," Gattine said. "Whether or not it's significantly different is in the eye of the beholder."
Mills proposed a series of tax increases that could generate $156 million in revenue to meet existing commitments, including proposing the first increase in cigarette taxes in 20 years. Increasing cigarette taxes from $2 a pack to $3 would increase state revenue by $78 million, according to her administration. But Republicans and others have criticized that approach as hurting low-income families.
Mills also proposed taxing online streaming services, such as Netflix and Spotify ($14 million); phasing in a new pension income tax for wealthier retirees ($44.7 million); increasing cannabis taxes ($6.3 million); and taxing pharmacies and private ambulance services, which it says will unlock additional federal funding to reinvest into the MaineCare program.
Ducharme said Republicans remain steadfastly opposed to new taxes.
"Maine people are the third or fourth highest taxed people in the nation with one of the smallest populations," Ducharme said. "It's ridiculous for us to think that we need to add more taxes because government can't get its spending under control."
Mills has also proposed cutbacks, including eliminating state-funded Supplemental Nutrition Assistance Program funds for noncitizens, cutting two crisis receiving centers planned for Aroostook and Kennebec counties, stopping a planned increase in child care worker stipends and planned cost-of-living increases for direct care workers, among others.
Mills also proposed reforms to the state's General Assistance program aimed at reducing costs and returning the program to its original mission as a last resort safety net, rather than an ongoing housing assistance program.
House Democrats initially agreed to a version of those reforms earlier this year, winning Republican support for a supplemental budget bill that would have allowed the state to immediately pay hospitals for services already provided to MaineCare patients. But that deal fell apart when Senate Republicans blocked its passage.
House Minority Leader Billy Bob Faulkingham said at a news conference last week that Republicans are still fighting for some of the reforms they had previously sought in the budget, including reforms to the General Assistance and MaineCare programs.
"We're still hoping they appear in the budget," Faulkingham said.
Gattine said Democrats have focused on scrutinizing the governor's proposals, while also considering changes sought by lawmakers. But he said it's too soon to say where the final budget will land.
"When we look at this stuff, we understand that these were tough choices, so we have to be much more careful and diligent in our work reviewing that (proposal), because at the end of the day we have to come up with something that is balanced, but also something that meets the moment and the needs of Maine people, which are significant," he said.
Staff Writer Rachel Ohm contributed to this story.
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