Under The Dome: Inside The Maine State House 1-10-2014

by Pierce Atwood LLP

Augusta, ME

Under the Dome: Inside the Maine State House 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.

Legislative Session Starts with a Flurry of Activity

On the morning of January 8th, the Second Regular Session of the 126th Legislature convened and is scheduled to be in session until statutory adjournment on April 16th. This year, the session is off to a busy start in marked contrast to last year. Many bills have already been printed and this week they were referred to their respective committees by the House and Senate. Meanwhile, Committees are tasked with reporting out all 200-plus bills that were carried over from last session by January 31st. To do so, they must make their final committee votes by January 24th. This requirement will result in a very busy January, as committees process this carried over legislation before turning to newly introduced bills.

Medicaid Expansion Remains Central Issue Before the Legislature

The first week of the legislative session revealed what many suspected before the session began, that Medicaid expansion will be one of the biggest political and policy skirmish this year. Democrats, along with a few Republicans in the Legislature, have been advocating for Medicaid expansion, a policy Governor LePage strongly opposes and vetoed successfully two times during the 2013 session. This issue will be revisited this session and is at the center of political debate in Augusta. The first day of the legislative session kicked off with hundreds of activists being bused to the State House to advocate for Medicaid expansion. Proponents argue that we are leaving federal dollars on the table that could be spent on healthcare in Maine, and that this is a matter of access to healthcare to reduce overall costs. Opponents argue that very sick people are on a waiting list for MaineCare and we ought not expend State resources to expand to more childless adults that ultimately will drive up costs for Maine taxpayers while not addressing the waiting list.

Governor Committed to No Supplemental Budget Proposal

Governor LePage remains committed to not issuing a supplemental budget proposal to balance the State’s budget during the remainder of the biennium. It is not unusual for State spending and revenues to not match projections and the State budget requiring a mid-course correction. This year, however, the Governor has left the task of balancing the budget to the Legislature, which enacted the current budget over his veto. The Legislature in general and the Appropriations Committee in particular has taken on this task and is now compiling information to identify shortfalls in various agencies before assembling a plan to close this gap. Additionally, included in the current budget is a requirement of identifying $40 million in savings or revenues or incur a further cut to municipal revenue sharing to close that gap. Currently, there is a lot of speculation at the State House regarding the size of the actual budget gap.

Taxation Committee Receives Reports of Task Forces

On January 8th, the Taxation Committee held its first meeting and received a number of reports from task forces examining various tax issues over the fall. This included a report regarding the transition of the Business Equipment Tax Reimbursement Program to the Business Equipment Tax Exemption Program as well as a report examining the issue of taxing non-profits. Most notable, however, was the Committee’s receipt of a report to identify the $40 million in savings or revenues in order to avoid a $40 million cut to municipal revenue sharing. A number of Committee members were critical of this report and frustrated at their limited ability to shape these recommendations as they proceed from this report through the legislative process. Ultimately, these reports will inform the Legislature’s work to balance the State’s budget.

Appropriations and Financial Affairs Committee Hears Bond Process Bills

On January 8th, the Appropriations and Financial Affairs Committee held public hearings on LD 138, An Act to Amend the Laws Governing the Issuance of Bonds that Have Been Ratified by the Citizens of the State, and LD 904, An Act to Clarify When Bonds May Be Issued. Both bills are concept drafts that propose regulating the issuance of bonds that have been approved by the voters. Both bills appear to be a reaction to Governor LePage’s previous refusal to issue authorized bonds until the State’s debt to Maine hospitals was repaid. The Governor has since released the bonds in question and this issue is not as immediate as it once was. In addition to the respective sponsors of these bills, the State Treasurer, Neria Douglass, testified on these proposals. While taking no position on these bills, the Treasurer did caution the Committee to avoid eliminating all discretion on the issuance of bonds. She explained that the State does save money by delaying issuance until a project is ready to start. Work sessions on both bills will be held today, January 10th.

Environment and Natural Resources Committee Considers Fee on Waste to Landfills

On January 9th, the Environment and Natural Resources Committee held a lengthy hearing on LD 1483, An Act to Promote and Enhance State Policy to Preserve and Support Existing Methods of Disposal of Municipal Solid Waste. This legislation would assess a $10 to $14 per ton fee, with no cap, on any material going to a landfill, affecting the cost of both public and private sector disposal. A couple of amendments to the bill, each seeking to exempt segments of the waste stream ,were presented at the public hearing, and several other concepts were discussed, but most retained the concept of placing a fee on disposal, and did not advance the reducing, recycling or composting of our wastes. The Committee will begin deliberations on this bill at work session on January 15th. Those concerned about the impact of this bill should contact members of the Environment and Natural Resources Committee or your own legislators. We are also available to assist in communicating your concerns to policy-makers.

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