Mainers, especially state employees, are breathing a sigh of relief that the state’s government shutdown ended quickly and without much disruption to state services. Republican legislative leaders and Gov. Paul LePage have taken victory laps for killing a voter-approved surtax on high incomes and a proposed lodging tax hike. Democratic leaders are touting an increase in school funding, although it is half as large as what voters approved, and needed financial support for social services.
But only days after LePage signed the $7 billion, two-year budget, ending the three-day shutdown, he’s already making threats about the next budget battle, which will come next year when lawmakers are likely to need to pass a supplemental budget to fix problems that could arise from the hastily enacted biennial budget and to adjust to Maine’s actual revenue collections.
This is bad news for Maine residents, who deserve a Legislature and governor who will work together to position the state well to take on pressing challenges, especially the need for more workers to power the state’s lagging economy. Instead, they are likely to get more partisan bickering and power plays.
Much of the State House rancor centered on education funding following Maine voters’ approval in November of a 3 percent surtax on annual income over $200,000. This was expected to generate $300 million over the next two years that would be directed to the state’s K-12 schools.
Republicans made repealing the surtax a priority, arguing that it was hurting small businesses, although a small fraction of Maine small businesses would have had to pay it. LePage later argued that the funding wasn’t needed because Maine schools aren’t performing well despite past increases in funding.
Democrats pledged to keep it, but quickly agreed to a smaller surtax and, then, alternative sources of school funding as negotiations ramped up late last month.
In the end, the surtax was repealed, but the budget includes an additional $162 million for schools, with $27.5 million directed to schools with high percentages of students in poverty.
LePage called the additional school funding “a ransom” and pledged to get “reforms” in exchange for the increased state spending. “We emptied the war chest on everything else in the state to take care of education and we are getting a sub-par system,” he said, according to Maine Public. “And now we got some reforms, you just watch me go the next year. There is going to be some hell to pay in education.”
So much for the great coming together and compromise that legislative leaders credited for ending the state shutdown early Tuesday morning.
Despite the governor’s already hostile rhetoric, there were needed compromises in the spending plan. For example, the budget LePage signed includes reversals of social service cuts he had included in his budget proposal. For example, the governor proposed to limit Temporary Assistance to Needy families to three years, down from the current five, tighten the MaineCare eligibility requirements for able-bodied parents and remove 18- to 20-year-olds from the MaineCare altogether. He also sought to eliminate General Assistance and to reduce reimbursements to critical access hospitals.
None of these changes made it into the final budget. Instead, it includes a boost in TANF benefits and allocates more than $14 million to support direct care workers. Low pay is causing shortages of workers needed to care for the elderly and disabled.
This is what a compromise budget looks like. Each legislative caucus, and the governor, got some of what they wanted, but also agreed to things they didn’t like.
The lesson from the shutdown of 2017? In the end, it was compromise, not hollow threats and grandstanding, that allowed the state to move forward.