Under The Dome: Inside The Maine State House 8-16-13

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Augusta, ME

Under the Dome: Inside the Maine State House is a regular update that provides a high-level overview of recent activity at the Maine State House. If you would like more specific information regarding an item in this newsletter or related to government relations, please contact a member of our Government Relations Practice Group: John Delahanty, Andrea C. Maker or Avery Day.

Bond Discussion Takes Center Stage in Augusta

Since adjournment of the Legislature last month, action on a bond package has been at the forefront of the discussion in Augusta. There remains disagreement between Governor LePage and Democratic legislative leaders regarding the size, composition and timing of a bond package. Consequently, a number of conflicting messages regarding bonds have been coming out of the State House for some time, and this week was no different. On August 13th, the Appropriations and Financial Affairs Committee held a meeting to receive information on a number of matters, including bonds.

This meeting was a bit tense, as representatives of the Executive Branch were directed by the Governor’s Office not to appear before the Committee. Without the expertise of the Executive Branch, the Committee was hampered in working through its agenda. Members of the Committee did say that, contrary to the Governor’s wishes, they did not anticipate that there would be sufficient time to have the Legislature act in order to add a bond issue to the November 2013 ballot. The very next day, however, the Governor, President Alfond and Speaker Eves had what was reported to be a successful meeting regarding bonds. These leaders appear to be close to an agreement that could result in a September Special Session to act in time to add a bond proposal to this November’s ballot.

State Ends Most Recent Fiscal Year with a Surplus

July 1st marked the beginning of a new State fiscal year. The closing of the most recent fiscal year brought some good news, as the State ended the year with a surplus of over $50 million. As explained by the Maine Revenue Service, this unanticipated surplus was likely a function of federal tax policy, which incentivized reporting income in 2012 as opposed to 2013. No matter the cause, the State reported a surplus; though that does not mean any new spending will result from this unexpected revenue. State statute proscribes how surpluses are allocated, which is a formula-driven process referred to in Augusta as a “cascade.” The resulting cascade will drive much of this surplus to the State’s “Rainy Day Fund.”

Legislative Committees and Study Groups Begin to Schedule Off-Session Meetings

As noted above, on August 13th, the Appropriations and Financial Affairs Committee held a monthly meeting to discuss bonds and to receive briefings regarding recent developments that affect the State’s budget. This meeting is the first of a number of meetings over the coming months that will help shape the agenda for the Legislature next year. In addition to off-session legislative committee meetings, the Legislature created a number of working groups, study groups and task forces that will be meeting over the coming months. These groups are traditionally tasked with tackling some of the thornier issues introduced each session in order to develop proposals to bring back to the Legislature for consideration. Two significant task forces are just now being formed, the first being charged with identifying significant savings by eliminating certain tax expenditures and the second being charged with examining the concept of taxing non-profits in some manner. As is true every year, this off-session work will significantly affect the policy agenda heading into next year.

Governor Announces New Chief Legal Counsel

Earlier this month, the Governor’s Office announced that Michael Cianchette, the Governor’s Chief Legal Counsel, was stepping down in order to serve a tour with the Navy Reserve in Afghanistan. On August 7th, the Governor’s Office announced that the Governor promoted Carlisle (“Carlie”) McLean to the position of Chief Legal Counsel. Ms. McLean has worked in the Governor’s Office since 2011 and has served first as the Governor’s Senior Natural Resources Policy Adviser and then as the Governor’s General Counsel. As those of us who have worked with her know, she is a key member of the Governor’s team who approaches policy in a very thoughtful manner.

Topics:  Bonds, Proposed Legislation

Published In: Elections & Politics Updates, Finance & Banking Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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