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Legislature enacts budget

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Tuesday, April 1, 2008

AUGUSTA - The Legislature gave final approval Monday night to a state budget rewrite that offsets a $190 million shortfall in Maine's $6.3 billion two-year General Fund budget by making a range of cuts with no new broad-based taxes.

The budget passed in the House by an 84-55 vote before winning Senate enactment with an 18-17 roll call as Monday's deadline closed in.

The package advanced by majority Democrats did not include a provision opposed by Republicans and unwelcome to Democratic Gov. John Baldacci. The new budget package dropped a hospital tax-and-match revision, which was spun off so it could face a freestanding vote of its own.

While seeking to balance Maine's $6.3 billion budget, Democratic legislative leaders sought to spare low-income childless adults from a host of cutbacks in state human services programs.

One major portion of savings within the package remained: a $34.1 million reduction in state aid to local schools advanced by Baldacci.

The budget includes no tax increases and does not touch the state's Rainy Day fund, said House Speaker Glenn Cummings, D-Portland.

"This budget is difficult and the cuts are real and deep and will affect our education and health care systems for years to come," said Cummings. But by not raising taxes or touching reserves, it leaves the state in a better position to weather a national economic downturn and federal cuts, he said.

Sen. Peggy Rotondo, D-Lewiston, co-chair of the Appropriations Committee, said passage marked the end of "a long and painful journey" by lawmakers. But she said that 98 percent of it won bipartisan support.

Senate Minority Leader Carol Weston, R-Montville, said, "We're just going to be looking at the very same budget" as the one advanced in the House last week, "only in two pieces."

The hospital tax-and-match provision would adjust the base year of a tax on net hospital revenue to raise $11 million that could be used to offset a proposed reduction in reimbursements for hospital-based physicians.

Short of winning two-thirds majorities in both chambers, which would allow program reductions to take effect right away, lawmakers had to act before Tuesday to ensure a revised state spending plan is in place by June 30 - the last day of the current fiscal year.

Failure to enact would prompt the governor to take emergency action to reduce expenditures. The new budget package must be signed by the governor to take effect by the end of June.

Democrats hold a commanding edge over Republicans in the House, but their Senate majority is a bare 18-17. New efforts on Monday within the Senate Democratic bloc sought to keep the caucus together.

In March, Baldacci proposed cutting $27.5 million from the human services budget. The governor already had put forth $65.4 million in human services cuts in January before a budget shortfall initially pegged at $95 million doubled to $190 million.

Facing dwindling General Fund revenue, Baldacci issued a $38 million curtailment order on Dec. 18, 2007. The amount of a new curtailment to slow the rate of state spending, effective April 1 in advance of the June 30 end of fiscal 2008, would be $27 million.

CLICK HERE To Show/Hide Discussion Thread - (5 Comments)
Comments
Posted By:John at April 1, 2008 9:37 AM (Suggest Removal)
15,000 State employees with full benefits paid in full and retirement benefits for life. Not a single one of them were considered for lay-off. 20% of them earn over $50K per year and half of them over $100K.

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Posted By:C at April 1, 2008 10:50 AM (Suggest Removal)
No cuts to the state administration, but lets cut SERVICES to the elderly, children and people with disabilities. Does not make sense to me to cut SERVICES to individuals who need it the most.

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Posted By:david at April 1, 2008 4:06 PM (Suggest Removal)
Good afternoon good people and hope everyone is well. I think a good way to raise revenue and to take away the full burden that the home owner- tax payer has to pay is to charge a fee or tax to the renter of apartments to help pay for the schools , town services and state services that we the home owner has to pay in our real estate tax. The renter is a free loader, getting services for free, sending children to our schools and not paying for this. Thank you , Dave.

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Posted By:Robert II at April 1, 2008 7:33 PM (Suggest Removal)
david is a moron. The landlord pays taxes, and unless he is as dumb as david, passes those costs onto his tenants as higher rent. david would make a fine successor to Baldacci.

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Posted By:horsefeathers at April 1, 2008 8:16 PM (Suggest Removal)
What budget? If the state had been serious about a true budget all these years 1,300,000 people would not be between 6 and 12 billion dollars in debt. How in hell can a budget balance this year when the state owes $300,000,000.00 to hospitals. I think that none of them in Augusta care about the people of Maine. They adore their self serving selfs. Balduce is the court jester and the legislators are enjoying the show at our expense. It is the best April fool of the year folks.

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