GOP joins Democrats to override LePage's budget veto, pass tax hikes

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MaineStateHouse1
AUGUSTA – The Maine State Legislature on Wednesday voted to override Gov. Paul LePage’s veto of the $6.3 billion legislative budget.

In the House of Representatives, 114 members voted in favor of overriding the governor, while 34 voted to sustain his veto. In the Senate, the vote fell 26 to 9.

“Let’s be honest, our state government has outgrown our economy and our ability to pay for it,” said Senate Minority Leader Michael Thibodeau (R-Waldo) in his floor testimony.

“Absolutely no one in this chamber, nor in the other chamber, nor the governor, is advocating for a state shutdown,” he said. “I think that we have other options. We’ve talked about them here. We’ve seen them in the media. The question is whether or not we’re willing to embrace those options,” he said. “I don’t think anyone was elected with the promise to increase the tax burden in Maine.”

“Let’s make the family budget a priority over the state budget. Right now we’ve got it the other way around,” he said.

In the House, a handful of Republicans offered spirited objections to the Legislature’s budget. GOP lawmakers pointed to questionable spending in the budget, including subsidies for industrial wind, funding for Efficiency Maine, raises for state workers, and free unlimited transportation for methadone treatments.

“We have a spending problem, not a revenue problem,” said Assistant House Minority Leader Alexander Willette (R-Mapelton). He said the sales tax increase would directly impact small business owners, such as farmers, every time they make the purchases necessary to operate.

Rep. Lance Harvell (R-Farmington) said that just because a budget is the product of bipartisan compromise does not make it good policy.

“If a Democrat and a Republican both stick their hand in my pocket to take money out of my wallet, bipartisan it might be,” said Harvell. “But that doesn’t change the outcome.”

Rep. Deborah Sanderson (R-Chelsea) said that while the tax increases were concrete and real, the budget’s promised spending reductions were undefined and may prove illusory.

“There is a $40 million initiative to find exemptions. Well, you must have an idea of what these exemptions are. Are they for middle-class families? Are they for business? No one knows,” said Sanderson. “There is a $30 million initiative for administrative cuts. What agencies and departments does it apply to? We don’t know.”

House Minority Leader Kenneth Fredette (R-Newport) broke with the governor and the conservative wing of his caucus. He said the question before lawmakers was a zero-sum game: pass the budget or allow a government shutdown.

“Compromise is one of the most revered and reviled words in American politics,” he said. “The choice we have is a shutdown or this budget. There is no plan B.”

Despite voting for a budget that will increase taxes, Fredette said his vote does not amount to an embrace of tax increases.

“With a vote for this budget, we are not endorsing tax increases. We are endorsing compromise,” he said.

The Democrats who testified in favor of overriding the governor’s veto focused on avoiding both a shutdown of state government services. House Majority Leader Seth Berry (D-Bowdoinham) even read newspaper headlines from the last state shutdown in 1991 under the administration of Gov. John McKernan.

“By overriding this veto, we will mitigate an enormous cost shift to property tax payers and avoid a government shutdown,” said Rep. Peggy Rotundo (D-Lewiston), a top Democrat on the Appropriations Committee. “This is a fair and responsible budget that will keep government open,” she said.

Rep. Benjamin Chipman (U-Portland), who is regarded as being politically left of the Democratic Party, said the problems with the budget began with a $400 million tax cut that was not paid for.

“Now we’re having to raise sales tax and meals and lodging tax… to pay for income tax cuts,” said Chipman.

Rep. Richard S. Malaby (R-Hancock) challenged Chipman’s assertions about income tax cuts, pointing to the latest figures from the Maine Revenue Service. He rejected the notion, invoked frequently over the past several months by Democrats, that the tax cuts passed in the last Legislature created the current budget problems.

“If you look at the numbers, income taxes are the only source of revenue that has gone up,” said Malaby.

The budget, proposed by the Democrat-controlled Appropriations Committee, contains a 10 percent increase in the sales tax and a 14.3 percent increase in the meals and lodging tax. The tax increases are designed to expire after two years, though there is some doubt as to whether future lawmakers will allow the increases to sunset.

S.E. Robinson
Maine Wire Reporter
serobinson@themainewire.com

24 COMMENTS

  1. “our government has outgrown our ability to pay for it” ought to be an indicator that your gov’t is a little too BIG, now, shouldn’t it? :o/

  2. I doubt this will have any affect on tourism or anyone else. Let’s run the numbers.

    Maine sales tax is 5%, a 10% increase on 5% brings the sales tax to 5.5%.

    That is the current sales tax on $100 is $5.00, with the increase the sales tax on $100 will be $5.50. An increase of 50 cents on every $100 spent.

    Maine meals and lodging tax is 7%, a 14.3% increase on 7% brings the meals and lodging tax to 8%.

    That is the current meals and lodging tax on $100 is $7.00, with the increase the meals and lodging tax on $100 will be $8.00. An increase of $1 on every $100 spent.

  3. Apparently, Paul LePage is either unfamiliar with Senator Margaret Chase Smith’s “Declaration of Conscience” or simply chooses to reject it as he continues to “ride to political victory on the Four Horsemen of Calumny — Fear, Ignorance, Bigotry and Smear.” Am I happy with everything in the new state budget? No, but it was the product of a democratically elected legislature, and fortunately, we live in a democracy rather than the totalitarian state for which Mr. LePage seems to lust.

  4. Just remember who voited for these tax increases and when we go to the polls in the next election you fix the problem. Its time to clean out these tax and spend politicians once and for all!

  5. To all the “bi-partisan” compromise (consensus – whatever yo name it) BS supporters: You can compromise all you want, but to steal more of Maine workers’ hard earned wages by hiking taxes – AGAIN – is criminal. Wages are the results of a contract………. labor in exchange for money to provide sustenance for the worker and his/her family. Sounds to me like a “law” that “impairs the obligation of contracts” to me! Take a stand, people; DO NOT COMPLY.

  6. Obesity, one spoonful of ice cream at a time…..the fable of the straw that broke the camel’s back should be required reading at the Booth School of Business; instead this is just a modified pricing strategy.

  7. Thomas why is it that you don’t want to talk about the percentage increase. The sales tax went up 10% the meals tax 14%. How about id I tell you that you next raise is 50 cents on your $100 pay? You going to be happy with that? No I didn’t think so. Your school of business has only taught you to be obtuse.

  8. This is an update to my earlier posting in the BDN with updates based on feedback from PR1492 who stated:

    “Let’s at least be honest enough to get the math right. The increase on the sales tax is 10% and the increase of the meals and lodging tax is 14.29%. What the impact on consumer behavior will be, the regressive nature of sales taxes, etc. Is another discussion entirely, but it is dishonest to mask the true nature of the
    increases by misstating the magnitude of the increases.”

    To PR1492: Fair enough, my wording could have been better and has been adjusted. With that consider the following.

    Thomas Czyz: Maine sales tax is 5%; and would increase to 5.5%.
    PR1492: Maine sales tax is 5%; a 10% increase on 5% brings the sales tax to 5.5%.

    That is the current sales tax on $100 is $5.00, with the increase the sales tax on $100 will be $5.50. An increase of 50 cents on every $100 spent.

    The magnitude to consider is not the 10%, but the 50 cents on $100 spent. What are you not able to buy now that you don’t have the 50 cents after spending $100? If you spent $1,000, then you are less $5 which may prevent you from buying what?

    Thomas Czyz:Maine meals and lodging tax is 7%; and would increase to 8%.
    PR1492: Maine meals and lodging tax is 7%, a 14.29% increase on 7% brings the meals and lodging tax to 8%.

    That is the current meals and lodging tax on $100 is $7.00, with the increase the meals and lodging tax on $100 will be $8.00. An increase of $1 on every $100 spent.

    Again the magnitude to consider is not the 14.29%, but the $1 on $100 spent. What are you not able to buy now that you don’t have the $1 after spending $100? If you spent $1,000, then you are less $10 which may prevent you from buying what?

    My description and your description are both correct in their math, and neither is
    dishonest. However, my issue with percentages is they are often used to
    influence the audience by appealing to emotion. That is why I did the math to
    put what the percentages equate to in actual spending power, to put it into
    each individual’s perspective. What I am no longer able to purchase by not having 50 cents or $10 due to taxes is different from what you are no longer able to purchase by not having 50 cents or $10 due to taxes. That is the magnitude.

  9. Hi!

    Does it matter which party dominates here in Maine?

    This override is an illustration that it doesn’t matter.

    Thanks all for the increase of taxes.

    Time to move out.

    Two (2) of my sons have already left the state, and my third one is leaving.
    in two weeks.

    Maine is losing the young to go elsewhere whereby they are not taxed to death.

    How nice!

    Thank you!

    Lise from Maine.

  10. What a pathetic statement! The totalitarian state has always been by the democrats, for the last forty years actually. Now the leaders are the two Seth’s, Berry and Goodall, two openly socialist that have done nothing but lie, scare and bully. Add in Justin Alfond who has never worked in his life, living off grandpas millions and you have the three stooges of Maine government. And then listening to the childish bleating of supporters like Bill Leonard, shows why Maine’s economy continues to fail. Why would any company move here when there is this volume of ignorance?

  11. Hey New Idea, both sides don’t like what got put into the new budget right, Why not change it? Start right NOW! They can change the law anytime they want. They change the law to borrow my pension and promise to pay it back with interest and then change that too. Now I have to pay in more to makeup for what they borrowed. Why not change spending and lower taxes. I guess that just makes too much common sense. I am sure they will just borrow more money from someone or somewhere else. Moving looks better and better. Maine is on the move. Move out.

  12. I am just fed up to my eyeballs with both of these parties. When we have republicrats going along for the ride with the democrats, the Maine people suffer again for it. EVERY BLASTED TIME the budget is increased and NEVER CUT, Wayne L. is 1000% correct, every time taxes are raised, it makes it that much more difficult for the Maine People, who actually work for a living, to make ends meet! And every time someone from away comes to our state and immediately gets on the welfare roles, that is another TAX on the Maine People. What the Governor’s Budget was trying to do was to get the States SPENDING UNDER CONTROL. But our TRAITOROUS Republicans made especially sure that the next generation of Mainers will not be as well off as we are today, and that ain’t sayin’ much!

  13. I went to my town hall and switched my voter registration from republican to un-enrolled because of the override. Unless the republican party in this state grows a pair they’ll have to beg for my vote in the future.

  14. Well, sure. Paul is an ignorant, bigoted, totalitarian and, worst of all, he smears people. Poor Bill, he’s has lost all awareness of self-parody; assuming he ever had it.

  15. Why is it so hard to locate the actual bill number? I am looking for the fiscal note for this bill so I can compare the impact on revenue with the impact on revenue for the about to be extended Seed Capital Tax Credit- a bill which socializes the risk and privatizes the gain for capital investments in Maine.

    This is what the fiscal note for the Seed Capital Tax credit says:

    Amending the Maine Seed Capital Tax Credit Program as proposed in this legislation would reduce General Fund revenue by approximately $455,000 in FY 2013-14, $1,300,000 in FY 2014-15 and $2,200,000 in FY 2015-16. Municipal Revenue Sharing would experience a slight reduction as well. Additional administrative costs incurred by Maine Revenue Services can be absorbed with in existing budgeted resources.

    http://www.mainelegislature.org/legis/bills/bills_126th/fiscalpdfs/FN074301.pdf

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