End of Session notes: the week the wheels came off

26 April 2018

Dear Friends and Neighbors,

As the end of this legislative session took a sharp and irresponsible turn last week, I want to offer my perspective from the Appropriations Committee.

Traditionally, the major work of the Appropriations Committee is to integrate the governor’s budget request with the legislature’s own spending and policy initiatives as they emerge during session and, finally, to negotiate and reach bipartisan consensus on the overall priorities within the constraints of the state’s revenue resources.

Prior to this year, in the second year of the state’s two-year budget it was the conventional practice of governors to submit to the legislature a supplemental budget request making adjustments to the overall biennial budget in order to reflect changes in the governor’s own policy initiatives and re-projections in state revenue.

In years with declining revenues, this is a fiscal and constitutional necessity.  But the biennial budget that the legislature enacted after last July’s three-day state shutdown has in fact resulted in significant increases in revenue — a circumstance for which everyone in the state should be grateful.

This session, for his final year in office, Governor LePage decided not to submit a comprehensive budget request. Instead, he submitted dozens of individual bills, with little advance notice, irrespective of committees’ session deadlines, right up through the final statutory legislative day when the Governor introduced four new bills apparently timed only for the utter impossibility of their proper consideration.

In complement to a $140 million increase in the state’s unappropriated fund balance, this session there were two major new policy changes which I outlined in more detail in my March 14 report:

In November, Maine citizens enacted an expansion of Maine’s MaineCare program for health care.  The state’s share of claim costs from this law will require an additional appropriation of between $30M and $60M sometime before the current appropriation is depleted in May or June of 2019 in the next legislative session.

In addition, conforming to the Trump tax plan that Congress enacted last December has implications for state revenues.  Simply conforming to the elimination of the personal income tax exemption would result in a $230 million increase in personal income taxes and state revenue.  However, especially as that tax increase skews regressively, no one advocates for simple conformity as good tax policy for Mainers.

Instead, the legislature’s taxation committee, following on a bill that the Governor introduced in March, worked diligently through late March and early April to create a tax plan which would eliminate the harmful impact of conforming to the Trump tax plan with a bipartisan, revenue-neutral plan.

As the Tax Committee was closing on a unanimous committee agreement, on April 4th Representative Fredette, the House Republican floor leader, and Representative Timberlake, who serves on Appropriations, declared to members of the Appropriations Committee that, rather than the Tax Committee’s agreement, his caucus would support only a tax plan that was negotiated in Appropriations as part of an overall spending plan.

Over the next two weeks and through the weekend of the Patriots’ Day holiday, Tax Committee members hammered out a tax restructuring recommendation to accompany a comprehensive spending plan and Appropriations members negotiated a spending package of bipartisan bills which extended agreements that were made during last year’s budget negotiations related to seniors, people with disabilities and mental illness, and kids with special needs, as well as an appropriation for the administrative costs of MaineCare expansion in the amount that the Governor’s administration has said it needs.

However, when the Appropriations Committee announced this negotiated list on April 18, House Republicans swerved again and declared that they would not support a comprehensive package unless it were linked to a rollback in the state’s minimum wage.  Failing that, they demanded that the bills be disaggregated for individual floor votes and subject individually to vetoes by the governor. As they require a two-thirds vote to override, vetoes ensure that the minority is empowered with the last word.

That evening, House Republicans then blocked an order which, with a two-thirds vote, would have allowed the legislature the time necessary to take action on any integrated package, as well as the 134 bills still pending prioritization for spending, and dozens of significant bills and bonds still in consideration before the legislature.

Well after midnight, with the legislative session already effectively terminated, the House Republicans voted against another joint legislative order, already passed unanimously and without controversy by both Democrats and Republicans in the Senate, which proposed to keep all the unfinished bills alive by carrying them forward to a special legislative session.

When the smoke cleared the next morning, most observers seemed confounded by the destruction. For the first time in memory, one caucus had effectively taken a torch to all outstanding legislative business before work could be completed, leaving grave uncertainty about public funding spreading across the state.

The legislature will return to consider vetoes next Wednesday, May 2.  Presumably at that time another legislative order will be presented proposing that the session be extended to complete essential items related to tax conformity, the allocation of a billion dollars of already appropriated school subsidy, funding for voter-approved MaineCare expansion, infrastructure bonds, opioid treatment, reimbursement rates for direct care workers, and the disposition of a hundred other bipartisan bills tentatively requiring funding.

At this time, Senate Republicans, Senate Democrats, and House Democrats all are eager to complete the work that Maine people elected us to do.  Next Wednesday we will see if the House Republicans will be willing to rejoin in that effort.

• Our View: Government dysfunction is the tea party’s legacy, Press Herald, 4/22/2018
• Unfinished legislative session is epitome of government dysfunction, Bangor Daily News, 4/24/2018