June 27, 2013

Maine legislators opt for compromise instead of a shutdown

They override LePage's veto and enact a $6.3 billion budget, capping a long ideological fight on what the governor calls a 'real sad day.'

By Steve Mistler smistler@pressherald.com
Staff Writer

AUGUSTA – In the end, the Legislature chose compromise over a government shutdown, a $6.3 billion budget over ideology and campaign promises.

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Maine Senators John Patrick, left, D-Rumford, and Roger Katz, R-Augusta, watch the debate in the House of Representatives on Wednesday, June 26 to override Gov. Paul LePage's veto of the state budget. Both senators voted to overturn the veto.

Staff photo by Andy Molloy

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Gov. Paul LePage speaks to reporters shortly after the Maine House and Senate both voted to override his veto of the state budget, Wednesday, June 26, 2013, at the State House in Augusta, Maine. (AP Photo/Robert F. Bukaty)

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The state sales tax will increase from 5 percent to 5.5 percent for two years, which will generate $133.8 million in revenue.

The meals-and-lodgings tax will increase from 7 percent to 8 percent for two years, which will generate $44.6 million in revenue.

State revenue sharing with cities and towns will be cut by $75 million, which may force some communities to reduce spending or raise property taxes to compensate for the lost revenue.

The $400 million in income tax cuts the Legislature passed in 2010 will be preserved.

And 30 of the 73 Republican lawmakers chose the budget over the wishes of Republican Gov. Paul LePage.

Wednesday's votes -- 114-34 in the House and 26-9 in the Senate -- overrode the veto that LePage issued this week and enacted a two-year state spending plan that neither Republicans nor Democrats liked very much.

Most legislators liked the alternative even less: the first suspension of state services since 1991. The compromise budget passed Wednesday was designed to preempt a shutdown.

House Speaker Mark Eves, D-North Berwick, said in a prepared statement that the vote "put to rest the specter of a state shutdown that has loomed over the Legislature for months. We made the responsible choice to support a bipartisan budget that blunts massive property tax hikes, puts money back into our classrooms and helps our seniors and people with disabilities."

A shutdown had appeared possible as early as January, when LePage proposed a budget with provisions that were rejected immediately and loudly by Democrats, who have majorities in the Legislature, and more quietly by Republicans, whose votes would be needed to override a veto.

In an impromptu news conference right after Wednesday's final override vote in the Senate, LePage reacted calmly, but strongly. He criticized Republicans and Democrats alike for a plan that "solidified our place as the 50th worst place to do business for the foreseeable future."

He said the Legislature is a "country club" where lawmakers are more interested in getting along with each other than with him.

"It's a real sad day for our elderly and a real sad day for our state," he said.

Both sides had to give ground to reach the compromise.

Democrats gave up the delay or repeal of a tax cut package that passed with Republican support in 2011. Many Democrats campaigned against the tax cuts while helping their party retake the majority in 2012.

Protecting the tax cuts was a priority for Republicans and LePage, but lawmakers split with the governor on how to do it.

Ultimately, both sides settled on a short-term fix: temporary increases in the sales tax (from 5 percent to 5.5 percent) and the meals-and-lodging tax (from 7 percent to 8 percent) to bridge an anticipated revenue shortfall, more than $400 million of which was the unpaid bill for the 2011 tax cuts.

House Minority Leader Kenneth Fredette, R-Newport, said in his floor speech Wednesday that the compromise was the only path to a balanced budget effective July 1.

"If there were a viable alternative, a path to inject more Republican values into this budget, I would consider it," he said.

Fredette said he didn't see one: "There is no Plan B."

He took a swipe at those in his party who sought to derail the budget compromise.

"The level of vitriol I have witnessed and the circular firing squads I have seen among Republicans cannot stand," he said. "With our vote for this budget, we are not endorsing tax increases. We are endorsing compromise, an indispensable requirement of governing that has been endorsed by many great Republicans."

Democratic leaders agreed.

"Today's vote is a vote for a higher responsibility to put our state on solid footing," said Seth Goodall, D-Richmond, the Senate majority leader. "It's also a vote for an opportunity to avoid property tax increases on every Maine homeowner. It's a vote for an investment in our schools and our children -- and it's a vote to keep the lights on."

(Continued on page 2)

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Additional Photos

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Representatives Kenneth Fredette, right, R-Newport, Alexander Willette, R-Mapleton, and Tyler Clark, R-Easton, watch the vote in the House of Representatives on Wednesday, June 26 to override Gov. Paul LePage's veto of the state budget. Fredette and Clark voted to overturn the veto, while Willette voted to uphold the veto.

Staff photo by Andy Molloy


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