AUGUSTA – Given their first look at details of dueling budget packages and just a few hours to propose changes, rank-and-file lawmakers took up the question of how to offset a $109 million Medicaid shortfall Thursday in the Maine House of Representatives.

Debate stretched into the night, but the final result seemed predictable to many.

“By and large,” the showdown shaped up as a lopsided battle between majority Democrats and the Republican minority, assistant GOP floor leader David Bowles of Sanford suggested.

“We all know that that’s eventually the outcome,” he said as a series of floor amendment were being voted down.

Gov. John Baldacci expressed general satisfaction with revisions made by Democratic legislative allies to his original supplemental budget plan.

“Time is running out,” he said, continuing his push for prompt action to bring state spending back into balance through June.

Republican lawmakers, however, remained sharply critical.

One target was the Democrats’ proposal of a tax-and-match provision designed to net more federal funding by assessing a new levy on hospitals to generate a bigger federal match.

The new tax would amount to 0.74 percent of the net operating revenue of each hospital in the state.

Also eyed warily by Republicans was a Democratic proposal to temporarily transfer up to $10 million to the General Fund from a retiree health insurance fund. As drafted, the transfer would occur by June 30 with repayment, plus interest, scheduled on or after July 1, 2005.

Baldacci and his Democratic allies, meanwhile, were rejecting a proposal by Republicans who do not want a new tax on hospitals to tap $18 million earmarked for Maine’s fledgling Dirigo Health program.

Democrats, with House and Senate majorities, hold enough votes to enact a bill themselves.

But Republican opposition sufficient to deprive the majority of two-thirds in the House and Senate would effectively delay the implementation date of any measure by 90 days.

The Senate was expected to take up the budget debate Friday.

Still to come this session is another round of budget-balancing for fiscal 2005, which begins July 1.

As debate got under way in the House, Democratic Rep. Joseph Brannigan of Portland urged lawmakers to “continue your support of health care for all the people of Maine” by ensuring access to insurance coverage for those unable to afford it now.

“People may say we can’t afford to be a leader,” said Brannigan, the House chairman of the Appropriations Committee that split along party lines earlier this week. “We can’t afford not to.”

The ranking House Republican on the Appropriations panel, Rep. Richard Rosen of Bucksport, voiced objection to what he described as a short-circuited process by which the budget legislation was reviewed.

He argued, moreover, that the Democratic plan “ignores the causes of the Medicaid shortfall,” which Republicans have laid to too rapid expansion.

While the Democratic budget plan would not touch $53 million in Dirigo Health funding and the Republican plan would leave $35 million available, Republican Sen. Richard Bennett of Norway said he was looking for a federal review of whether money from Washington had been drawn on improperly.

Baldacci said in response he believed state plans for federal relief funds have been appropriate and suggested that politics more than policy were in play.

Baldacci’s budget chief, Rebecca Wyke, said the Dirigo funding had been freed up by the application of federal relief money for other purposes.

Democrats said their budget package would restore $2.4 million of a proposed $8.3 million in cuts to the University of Maine and Community College systems, less than Republicans advocated.

AP-ES-01-29-04 2123EST

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