Lawmakers and governor brace for budget battles in Augusta

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AUGUSTA — The state’s Democrat-controlled Legislature and Republican governor are lining up their talking points and polishing their rhetoric as they gear up for next few weeks of budget negotiations and debate.

Gov. Paul LePage on Thursday issued a video trumpeting state income-tax cuts passed into law by the outgoing Republican majority while urging lawmakers to get to work. The video preceded the Legislature’s first round of committee meetings and debates on the budget. 

Members of the Legislature’s Appropriations Committee on Friday are set to look for detailed answers on a $35 million emergency state budget cut, known as a curtailment, enacted by LePage in late December. A projected shortfall in state revenue prompted the short-term spending reductions. The governor and the Legislature, under the state constitution, are required to maintain a balanced budget.

The conversation between state finance Commissioner Sawin Millett and the Appropriations Committee on Friday will be the first fully public talk between the Legislature and the governor’s administration. Democratic leaders say LePage has been unavailable to meet with them.

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Lawmakers hope to learn specifics on where the cuts made by the governor will be felt the most. The Legislature must bring into balance the state budget, which is short an estimated $135 million. The figure includes the shortfall accounted for by LePage’s temporary budget cuts and a projected $100 million gap in the Maine Department of Health and Human Services budget, Rep. Peggy Rotundo, D-Lewiston, said.  

After lawmakers finish that — possibly in mid-February — they will take up the state’s next two-year budget, which must be passed into law by the end of June. LePage is expected to submit his budget proposal to lawmakers by Friday, Jan. 11.

Rotundo, the House chairwoman of the Appropriations Committee, said lawmakers were ready and willing to work on the budget problem, but they want to hear from Maine people.  

A round of public hearings are likely, she said, and committee leaders intend to listen to Mainers before they reach conclusions about taxes or spending cuts.

It’s especially important, Rotundo said, to make sure budget changes don’t result in property-tax increases. She said details on state revenue-sharing with municipalities, funding for public education and funding for programs that help support vulnerable individuals were going to be key areas of concern for Democrats.

LePage on Thursday hinted that lawmakers, especially Democrats, would target recently enacted state income-tax cuts. The tax breaks include provisions that made exempt from state taxes nearly 70,000 low-income and elderly wage earners.  

Democrats have characterized the tax breaks as benefiting only wealthy Mainers, LePage said, but the breaks benefit people across the board. Some 450,000 Maine taxpayers will pay less to the state this year, the governor said.

“This represents the largest tax cut in Maine history,” he said. “For Democrats to call this a tax cut for the rich is simply not true, especially when they voted for it.”

Jodi Quintero, spokeswoman for House Democrats, said Democrats voted for the measure because the tax cuts benefit the working class, but the bulk of the tax breaks went to the wealthiest Mainers. Middle-income wage-earners would see an annual tax break of about $119 a year while those in the top 1 percent of Maine wage-earners would see an average tax break of about $2,905.

“Democratic leaders have not taken a position on those tax cuts,” Quintero said. “They are unfunded and they are part of the budget hole that we are facing and lawmakers are going to have to close, and we are going to have to hear from the public.”

In his video, LePage quoted Ronald Reagan in challenging lawmakers to get to work. Using a line from Reagan’s seventh State of the Union Address, the governor said, “Put on your work shoes; we’re still on the job.”

LePage also noted that Maine has again received a dismal ranking from Forbes magazine for being a place unfriendly to business growth and investment.

“Capital goes where it is welcomed and stays where it is appreciated,” LePage said. He said that while the tax breaks enacted during the last lawmaking session where a good start, he believed the state could not afford to go backward. 

“We must put more money where it is needed: in the pockets of Maine people, not Maine government,” he said.

Rotundo said lawmakers are ready to work and will begin Friday.

“We are really ready to roll up our sleeves and dig in and achieve a better understanding of what this curtailment order is all about,” Rotundo said. She said chairs of the Appropriations Committee had leaders in both Democratic and Republican caucuses talking and working together.

She said they were setting the schedule for hearings and lawmakers from both parties were well-prepared to do their parts in the process.

Rotundo reiterated a long tradition of the committee to pass bipartisan budget bills. She said LePage’s notion that Democrats will simply look to roll back prior tax breaks is not one that’s been discussed by her party.

She said committee decisions would be fair and practical. “We will be thorough and open-minded and not driven by ideology,” she said.

sthistle@sunjournal.com

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