AUGUSTA (AP) – The potential for a people’s veto referendum on a borrowing provision in Maine’s pending state budget stirred State House debate for a second day Wednesday as state Treasurer David Lemoine said there could be an almost immediate impact.

“In terms of the rating agencies,” Lemoine said uncertainty over the viability of a major piece of the two-year budget slated to take effect July 1 would have the effect of “making it very hard to sustain the ratings that we’ve got.”

Lemoine, a former Democratic House member elected to the post of treasurer by the Legislature, also warned that the state could face additional costs on a borrowing in June.

On Feb. 4, Moody’s Investors Service said it had placed the state of Maine’s general obligation bond rating, Aa2 with a stable outlook, on its Watchlist for a possible downgrading.

Maine’s capacity for debt has figured heavily in this year’s partisan dispute over a budget and on Tuesday five Republican lawmakers joined in the first formal step toward challenging a $450 million borrowing plan approved late last month by House and Senate Democratic majorities and Gov. John Baldacci.

The revenue bond plan contained in the budget would draw on more than a dozen sources, including accounts within the secretary of state’s office, for repayment.

The GOP budget critics have gone to the secretary of state’s office to begin the process of mounting a people’s veto, which would entail gathering more than 50,000 petition signatures by June 28.

The filing with the secretary of state had lawmakers on both sides speculating about its influence on other fiscal matters, including follow-up budget legislation and new bonding for a variety of projects.

“I don’t think it should interfere with our ability to dispose of the rest of our business,” said Rep. Sawin Millett, R-Waterford, an Appropriations Committee member who is one of the signers of the people’s veto application.

“I hope it doesn’t, but it’s a very unusual act for them to take,” said Rep. Janet Mills, D-Farmington, another Appropriations panelist.

Baldacci has outlined a proposal for nearly $200 million in new borrowing, saying it could promote economic development and further protection of the environment.

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