STATE HOUSE

April 11, 2012

Budget deal unlikely to please LePage

By Susan M. Cover scover@mainetoday.com
State House Bureau

AUGUSTA -- A scaled-down version of Gov. Paul LePage's $38 million supplemental budget that makes less severe cuts to General Assistance will come before the Legislature this week.

Just before midnight Monday, the Appropriations Committee gave unanimous bipartisan approval to the budget, which is necessary to address a shortfall in the two-year $6 billion budget. It also provides additional funding in some areas, including court security and the computer crimes lab.

The committee rejected several of LePage's proposals, and scaled back others.

The most contentious issue involved state funding that goes to cities and towns for General Assistance. LePage proposed cuts that would have affected large cities such as Portland and Bangor the most, while cutting back on help for all municipalities. Big city mayors formed a coalition to lobby against the changes, and lawmakers worked to blunt the impacts.

Overall, cities and towns will get an additional $10 million this fiscal year and next to help pay for General Assistance to address "chronic underfunding," said Sen. Richard Rosen, R-Bucksport. But the committee also approved new limits in the program.

Language approved by the Appropriations Committee reduces assistance levels by 10 percent, restricts the housing program to no more than 270 days, reduces reimbursement for large cities from 90 percent to 85 percent and creates a working group to make recommendations for future changes.

The bill also establishes seven family independence specialist positions to help veterans and others enroll in federal programs if they need help. The jobs are for a two-year limited period.

Rep. Peggy Rotundo, D-Lewiston, said the committee agreed that the program needs an overhaul.

"Everybody needs to take a step back and look at it thoroughly," she said. "One thing I was concerned about was not making changes that would have unintended consequences."

But the committee changes are not sitting well with the LePage administration, said spokeswoman Adrienne Bennett. She said the governor wanted to make structural changes. He proposed cutting large cities from 90 percent to 50 percent, and limiting housing to no more than 90 days, among other things.

"We have a forward thinking governor who's looking down the road and we have legislators who are kicking the can down the road," she said.

LePage, who was in New York on Tuesday to participate in an economic conference, will be briefed on the budget today, she said.

During negotiations last week, the committee rejected the elimination of all state funding for the Maine Public Broadcasting Network and a proposed $2.4 million cut from higher education.

The budget that is expected to be considered in the House on Thursday allocates additional funding for court security, the state computer crimes lab, and indigent legal services. It creates a new Office of Policy and Management that will focus on long range fiscal planning, effective government, ways to save money and will be a type of think-tank for the governor's office.

Although the original proposal gave the office broad subpoena powers, those have been scaled back by the Appropriations Committee. The office must now first seek court approval before a subpoena is issued.

The committee rejected three tax cuts proposed by LePage, including an initiative to lower the income tax on pensions. The other two would have exempted from the income tax active duty military pay earned outside Maine and provided a sales tax reimbursement to commercial wood harvesters and greenhouses.

Rosen said the committee didn't have enough time to consider the proposals.

"The limitation of time, in terms of the session, and the effort it takes to dedicate to every other initiative simply did not allow us the opportunity to put in the kind of analysis and effort it will require to come to a resolution," he said.

Rotundo said the tax cuts troubled Democrats because they weren't funded. Although they had no fiscal impact this year or next, the pension tax cut alone was projected to cost $36 million in the next two year cycle and $105 million a year by the time it is fully phased in in 2019.

The committee still has one more budget to vote out because of a shortfall at the Department of Health and Human Services. The Legislature is expected to come back in May to consider that budget to address an estimated $100 million deficit.

Susan Cover -- 620-7015

scover@mainetoday.com

 

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