Under The Dome: Inside The Maine State House 5-17-13

by Pierce Atwood LLP

Augusta, ME

Under the Dome: Inside the Maine State House is a weekly 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.

Governor’s Fourth and Fifth Vetoes of the Session Sustained

Last week, Governor LePage vetoed his fourth bill of the session, LD 6, An Act Regarding the Authority of a School Board to Elect a School Superintendent. This bill would have overridden several municipal charter requirements relating to local residency requirements for superintendents. On May 14th, the House voted to sustain the Governor’s action in what was largely a party-line vote. Because the House did not muster the required 2/3rds vote to override the Governor’s veto, this bill is now dead. The very next day, the Senate considered the fifth bill vetoed by the Governor this session, LD 521, An Act to Change the Budget Approval Process for Alternative Organizational Structure. This bill would have changed the school budget approval process for alternative organizational structures. The Senate, by one vote, sustained this veto as well, killing this proposal.

Negotiations on Hospital Repayment Tied to Medicaid Expansion

In what has been termed a “surprise vote,” the Health and Human Services Committee voted on May 15th to link legislation expanding Maine’s Medicaid program to a proposal to pay the State’s debt to hospitals. Since nearly the beginning of the session, the Veterans and Legal Affairs Committee in conjunction with the Appropriations and Financial Affairs Committee have been working on a proposal from the Governor that would borrow against future revenues from the State’s wholesale liquor contract to pay the State’s debt to Maine’s hospitals. The Governor has additionally stated that with this plan enacted, he would release authorized but unissued bonds. On Wednesday, Democrats in the Legislature added to this proposal by linking the Governor’s proposal to an expansion of Medicaid, a move strongly opposed by legislative Republicans and the Governor. At this point, it is unclear how this latest development will be resolved.

Omnibus Energy Bill Unveiled in Committee

On May 14th, the Energy, Utilities and Technology Committee was scheduled to hold work sessions on nine separate bills that had already been heard in that Committee. Instead, Committee Chairs and Leads unveiled a 30-page omnibus energy bill that combined elements of each of the nine bills before the Committee that day. This wide-ranging bill touches on reforms of the Efficiency Maine Trust, a proposal to reduce energy costs by contracting for natural gas pipeline capacity, nontransmission alternatives, reform of Maine’s Regional Greenhouse Gas Initiative laws, interconnection of natural gas pipelines, and municipal acquisition of street lights. The Committee then proceeded to evaluate this bill and solicit public comment on this proposal on Wednesday and Thursday. The Committee will continue to work on this proposal next week. Consideration of this omnibus bill has delayed the Committee’s consideration of some other bills pending before it and these bills will likely be addressed later in the week next week.

Tax Reform Proposal Examined in Committee

On May 10th, the Taxation Committee held a public hearing on LD 1496, An Act to Modernize and Simplify the Tax Code. This bill is the concept draft detailing a major tax reform effort that has been formulated by the bi-partisan “Gang of 11.” Supporters and opponents of this bill turned out to testify on this proposal in what was a long public hearing. Those supporting the bill tended to represent municipal interests. They argued that this proposal would reduce property taxes. Opposition to this bill included various elements of the business community, including the Maine State Chamber of Commerce, representatives from the tourism industry and others who were concerned about the elimination of various tax exemptions. This bill was then considered in work session on May 14th and will be considered again on May 17th. The path forward for this proposal is uncertain, as it faces opposition from various corners. At the same time, those who worked to assemble this package are very committed to this reform proposal.

Budget Change Package Heard in Appropriations Committee

On May 8th, the Governor’s Office released a “change package” to the biennial budget. This proposal is meant to address changes in State spending and revenues since the biennial budget was proposed at the beginning of the session. The Appropriations and Financial Affairs Committee is holding a public hearing on this “change package” on May 17th to provide the public an opportunity to comment on this proposal. Testimony will be heard all day, with speakers limited to two minutes of testimony.

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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