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State’s workers face 5% pay cut

Posted May 14, 2009, at 8:48 p.m.

AUGUSTA, Maine — Budget negotiators in the Legislature have tentatively agreed to a one-time 5 percent pay cut for all state employees effective Oct. 1.

The across-the-board cut would take off the table other proposals including furloughs and curbs on merit and longevity pay. The bill would affect about 14,000 state workers if it becomes law.

The proposal potentially would save about $23 million over the two-year budget cycle that begins July 1, according to the governor’s office.

“We would have liked very much to negotiate how this happens so we’re disappointed,” said Tim Belcher, executive director of the Maine State Employees Association.

Appropriation Committee members worked into the morning Thursday and returned early to face another long day. Much of the negotiations were behind closed doors.

The committee is hoping to send a package to the full Legislature next week. The Democratic-controlled Legislature will need Republican support, however, for the bills to get the two-thirds vote needed for the measures to take effect July 1.

Gov. John Baldacci’s plan for the General Fund originally came to $6.1 billion but was reduced to $5.8 billion in the face of lagging tax collections.

The governor’s plan also calls for eliminating more than 300 state positions. Deeper spending cuts proposed since then will not mean additional work force reductions, officials say.

Legislators also were trying to arrive at possible adjustments in state employee health insurance, dairy farmer support, and back payments to hospitals that provided services to Medicaid recipients.

Also still under discussion were revenue-raising proposals that would suspend the inflation-related indexing of state income tax brackets and allow the state to deviate from the federal standard deduction.

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