AUGUSTA, Maine — Former Gov. Paul LePage kicked off his 2022 re-election campaign Wednesday evening with promises to undo the policies of his successor, Gov. Janet Mills, and work toward goals he did not achieve during his previous eight years in the Blaine House.
LePage, who was known during his tenure as governor for controversial remarks and sometimes going off-book during official speeches, seemed to largely stick to his script during a 35-minute address Wednesday evening.
But he still made claims on a range of issues, including his proposal to eliminate the personal income tax, that benefit from scrutiny. Here is a breakdown of the facts, numbers and context behind several of his key arguments against Mills.
LePage: “Maine continues to struggle with one of the highest overall state and local tax burdens in the country. Maine’s tax burden as a share of personal income is 10.5 percent. We rank number four in the nation. Our neighbors to the south in New Hampshire have a tax burden of 6.84 percent, and they rank 46th in the nation.”
How Maine’s tax burden compares to other states depends on what is included when calculating it. LePage’s numbers here appear to come from a study by WalletHub, a personal finance website, which looks at property taxes, individual income taxes and sales and excise taxes paid as a share of personal income. It does not include other types of taxes, such as corporate income taxes.
A different measure comes from the Tax Foundation, a nonprofit think tank, which looks at the tax burden using the total amount of tax revenue. It finds that Maine’s burden is the 12th-highest at 11 percent, while neighboring New Hampshire has a tax burden of 9.7 percent and ranks 28th. That data is as of 2019, the most recent data available, and Maine was unchanged from 2018, LePage’s final year as governor.
The differences make sense when you consider what is included in each measure. Compared to the Tax Foundation’s measure, the WalletHub calculations are generally going to understate the total amount of taxes paid in states that use something other than property, income and sales taxes as a significant source of revenue.
For example, business taxes account for about a third of revenue in New Hampshire, compared with less than 10 percent in Maine. That is in part because New Hampshire has a flat tax rate of 7.7 percent on corporate income, while Maine’s ranges from 3.5 percent to 8.93 percent depending on the size of the corporation. (There are also tax credits in each state that make the issue more complicated.)
With regards to LePage’s original statement, there is a study that backs up his numbers. But other methodologies that include more types of taxes might give a more complete picture of the overall tax burden in Maine.
LePage: “Janet [Mills] continues to support one of the highest personal income tax rates in the country, a burden which suffocates economic opportunity for all members of state.”
As with the overall tax burden, different calculations of the personal income tax rate between states will lead to different results. Maine’s highest tax bracket, for single filers earning more than $53,150, is 7.15 percent. Ten states and the District of Columbia have a higher rate for their top tax bracket, according to the Tax Foundation, although brackets are structured differently across the states and exemptions and deductions also vary.
The WalletHub study LePage referred to earlier in his speech is a useful tool here because it breaks down tax burdens by type of taxes. That study finds that individual income taxes paid in Maine account for 2.45 percent of total personal income here. That ranks 21st among states — more in the middle than one of the highest.
On Medicaid expansion
LePage: “Janet Mills and her political cronies expanded welfare and Medicaid to unprecedented levels. She returned Maine’s Medicaid spending to the eras of the past liberal governors, adding tens of thousands of able-bodied, young adults with no children to the welfare rolls.”
Mills signed an executive order on her first day in office expanding Medicaid, also known as MaineCare, allowing individuals earning up to 138 percent of the poverty line to receive health coverage via the federal program. As of August, about 82,000 people are enrolled in the Medicaid expansion, including about 70,000 childless adults and 12,000 parents and caretaker relatives, according to data from the Maine Department of Health and Human Services.
But that’s not the full story. Maine voters approved a referendum to expand Medicaid in 2017, with about 60 percent voting in favor. LePage resisted implementing the expansion in the final year of his gubernatorial tenure. Advocates sued his administration, and a Maine superior court judge ordered him to expand the program in November 2018. LePage appealed the ruling, which allowed him to essentially run out the clock.
Mills ran for governor in 2018 promising to expand Medicaid and touts the expansion as one of her administration’s accomplishments. She will likely defend her record on this issue in the coming year. But is it worth noting that Medicaid expansion may have happened regardless — while LePage blames Mills increasing enrollment, it is something voters had already approved.
On pandemic response
LePage: “When Janet Mills announced a plan to distribute the federal relief funds — that billions of dollars that Maine received — she budgeted less than 1 percent … for nursing homes.”
LePage is referring here to Maine’s roughly $1.25 billion allocation of discretionary federal coronavirus relief money from a bill that passed in March 2020. Most of that total went toward assistance for small businesses and to support K-12 school reopening efforts. Through a program for health care providers, Mills’ administration allocated $12.5 million for nursing homes — exactly 1 percent of the original total.
LePage and other Republicans have argued she should have allocated more. In responding to a similar argument from a Republican state senator earlier this year, Mills’ administration noted that the state had allocated funding from other sources toward nursing homes as well, telling News Center Maine that funding from the state budget and supplemental budget, including both one-time payments and increased provider rates, totaled nearly $100 million.
Most Maine nursing homes also received funding during the pandemic through programs such as the federal Provider Relief Fund and the Paycheck Protection Program. But even with all that aid, nursing homes are still facing significant financial distress, and it could be a key issue in the race between Mills and LePage in the coming year.
Four Maine nursing homes announced closures in the last month, citing a range of factors including Maine’s vaccine mandate for employees. The problem is not new — eight nursing homes closed between 2016 and 2018, according to state reports — but the pandemic has only made things worse, and the issue is likely to keep coming up.