Maine House votes to restore state aid to municipalities

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AUGUSTA — Lawmakers in the House on Tuesday gave approval once again to a bill that would restore $40 million in state aid to municipalities, setting the stage for a vote in the Senate where its future is less certain.

The vote in the House took place without a roll call, and sends the bill to the Senate, where debate and an initial vote are anticipated to take place Tuesday afternoon.

The bill, LD 1762, would pay for the funds to municipal revenue sharing with $21 million from the state’s Budget Stabilization Fund, commonly known as the rainy day fund; $4 million from a fund designed to accumulate budget surplus with the goal of reducing state income taxes; and $15 million from unappropriated new revenue predicted in recent state economic forecasts.

Democrats fended off six amendments to the bill, seeing the original, unamended proposal from the budget-writing Appropriations Committee as the surest way to secure the GOP support necessary to override a potential veto by Republican Gov. Paul LePage.

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Five Republican amendments were killed by Democrats with little debate. They included proposals seeking to protect the savings accounts and replace the funding through other means more amenable to Republicans, including a proposal by Rep. Lawrence Lockman, R-Amherst, that would have paid for revenue sharing by eliminating state funding for general assistance and MaineCare funding for methadone treatments, podiatry and screening for sexually transmitted diseases.

An amendment from Rep. Peter Stuckey, D-Portland, which would have paid for the revenue sharing with cuts to tax breaks for businesses and increased income tax on income over $289,000, was also killed.

Last week, House Republicans argued fiercely against the bill and tried several times to delay a vote during hours of fiery debate. In the end, though, roughly 30 members of the GOP broke from party leaders and LePage — who say the bill is fiscally irresponsible and out of order — and voted with Democrats to approve the measure, 114-21.

The current biennial budget included a $40 million cut to revenue sharing in 2015 if the Legislature could not find a way to fill the gap. The budget already reduced revenue sharing by more than $30 million, from about $96 million in 2013 to about $65 million the first year of the two-year budget that started July 1, 2013; if the $40 million hole isn’t filled, the total amount of state aid to cities and towns will fall to about $20 million in the second year.

That would represent a nearly 80 percent decline in state aid to municipalities in just two years.

LePage opposes the bill, saying that raiding the state’s rainy day fund will result in less favorable bond ratings for the state, hurting its ability to borrow money. As such, he has said recently that he will not release up to $100 million in transportation infrastructure bonds if the Legislature passes the law.

Whether the governor will veto remains to be seen; several lawmakers reported the governor on Friday told attendees of the Maine Chamber of Commerce Leadership Summit that despite his opposition, he would not veto the bill, but would leave any fallout to be dealt with by the Legislature.

However, LePage’s office said Monday that a veto was “likely,” though no decision will be made until a bill hits his desk.

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