October 23, 2017
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Late-night budget deal aims to dodge Maine government shutdown

By Christopher Cousins and Michael Shepherd, BDN Staff
Updated:
Troy R. Bennett | BDN | BDN
Troy R. Bennett | BDN | BDN
State House in Augusta

Barely a day away from a government shutdown, a special six-person budget committee recommended a tenuous two-year state spending plan to the Legislature late Thursday, setting up a scramble to wrangle two-thirds support and a showdown with Gov. Paul LePage.

The deal brokered by Senate President Mike Thibodeau, R-Winterport, and House Speaker Sara Gideon, D-Freeport, has a bottom line of $7.1 billion and appears to be the state’s only hope of avoiding a shutdown.

But it’s full of pitfalls that could repel some Republicans and Democrats in what promises to be a dramatic set of votes on Friday. Minority members in both parties said they were left out of negotiations, with Rep. Tom Winsor, R-Norway, casting the lone vote against the plan.

Chief among potential conflict points are a lodging tax increase and overall price tag that Gov. Paul LePage has said is too high, as well as repeal of a surtax that progressive Democrats have staunchly defended.

[More: Here’s what happens when state government shuts down]

The budget bill must win two-thirds approval in the House and Senate and be signed by the governor before 11:59 p.m. Friday to avoid Maine’s first government shutdown since 1991.

However, LePage said on Thursday that he’d hold a budget that raised any taxes for the 10 days he’s allotted under law, which would cause a shutdown even if a budget passes.

Thibodeau called the budget “an imperfect document,” but said he hoped it “will be good enough to bring people together.”

“We feel we’ve done the best job we can here,” Gideon said.

But Winsor’s vote could be problematic, because a number of LePage-aligned House Republicans will have to support the budget to achieve two-thirds support.

Afterward, he and fellow Republican members were hustled into a meeting with Kathleen Newman, LePage’s deputy chief of staff. House Minority Leader Ken Fredette, R-Newport, declined comment through a spokesman.

“I don’t know whether the governor’s office and the governor himself would approve this proposal,” Winsor said during the meeting.

The plan aims to resolve Maine’s budget impasse by increasing state aid to K-12 public education funding by $162 million over the current biennium while eliminating the surtax on high-income earners approved by voters in 2016.

Republicans have long aimed to repeal the surtax but progressives have defended it. The scrapping of the surtax represents a major concession by Democrats, as does the level of education funding offered by Republicans.

To offset some of the lost revenue, the plan would raise Maine’s lodging tax from 9 percent to 10.5 percent beginning Oct. 1 — higher than the Senate Republican proposal of 10 percent that was made earlier this week.

LePage hammered that in a Thursday radio interview — even though he suggested raising the lodging tax to 10 percent in his original budget proposal in January as part of a package of tax proposals designed to eliminate the 3 percent surtax for education and reduce Maine’s top income tax rate to 5.75 percent.

The compromise plan also would use unspent Medicaid funding and $10 million over the biennium from the Fund for a Healthy Maine, which is underwritten by a lawsuit against tobacco companies.

[LePage: Police would work, state parks stay open in shutdown]

Among the other elements of the deal the special budget panel added Thursday were more than $14 million in new funding for direct-care worker pay rates and $8 million for a LePage-supported grant fund to help schools and municipalities regionalize.

Under committee rules, the budget proposal forwarded Thursday night cannot be amended during debate in the House and Senate.

Thursday’s meeting followed quietly unproductive Appropriations Committee budget talks that stalled for several weeks before the committee of conference convened on June 13 to take over negotiations.

LePage isn’t the only concern with the budget. Both Thibodeau and Gideon said they expect some Republicans and Democrats to vote against it.

Sen. Catherine Breen, D-Falmouth, the only Senate Democrat on the special budget committee and the Appropriations Committee, voted for the plan, but she said during the meeting that she was disappointed that the Appropriations Committee was cut out of the process and that end-stage negotiations were conducted only by Gideon and Thibodeau.

“I believe most likely it’ll still be a two-thirds vote,” said Senate Minority Leader Troy Jackson, D-Allagash, “but I don’t think it had to come to this.”

After LePage unveiled his budget proposal in early January, the Appropriations Committee spent months poring over it before presenting three partisan recommendations, none of which stood a chance of garnering support needed to pass in the House and Senate.

LePage has said repeatedly this week that if the full Legislature doesn’t support the budget priorities backed by House Republicans, he will delay action on a budget bill for up to 10 days before vetoing it. Not counting Sundays, that’s the window afforded him to consider bills under the Maine Constitution.

If that comes to pass, presuming the Legislature garners the needed two-thirds support on Friday, state government would be shut down through July 10.

 


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