November 23, 2024
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‘Preliminary agreement’ reached in state budget negotiations

AUGUSTA – Weeks of wide-ranging state budget talks finally have produced a series of tentative compromises between Democrats and Republicans, with some expensive and potentially divisive items moved into a category that lawmakers Thursday termed “preliminary agreement.”

The biggest such item is state aid to local schools. And at least for now, the Appropriations Committee has chosen to accept the two-step increases proposed by Gov. Angus King: 5 percent in fiscal 2002 and 3 percent in fiscal 2003.

The panel also agreed to boost a so-called cushion, which could offset distribution formula losses for some municipalities, from the $2 million proposed by King to $5 million, Democratic House leaders said.

King’s original two-year budget package carried a price tag of about $5 billion. The level of school funding envisioned by the administration and legislative budget writers would build on general purpose aid pegged at about $664 million in the current fiscal year.

On higher education, the appropriations panel has penciled in funding increases of 4.2 percent and 2.5 percent for the University of Maine System. The state technical colleges and Maine Maritime Academy could be in line for increases of 4 percent and 2.5 percent.

To date, despite evident philosophical differences, members of both parties and the independent Senate chairwoman of the Appropriations Committee, Sen. Jill Goldthwait of Bar Harbor, generally have tried to work by consensus.

Most of their deliberations, moreover, have occurred in public.

“We are walking down the road together with our Republican counterparts,” House Majority Leader Patrick Colwell, D-Gardiner, told rank-and-file House Democrats during a caucus meeting Thursday.

Some of the budget bargainers’ discussions, however, have been conducted outside the Appropriations Committee’s hearing room, away from public observance.

Private talks preceded a flurry of committee actions Wednesday night, after most of the State House had emptied.

The committee tentatively has booked King’s recommended 26-cent-a-pack increase in the cigarette tax.

It also has endorsed, for now, a Taxation Committee plan embraced by King to extend the 7 percent sales tax on meals and lodging to food establishments that do not serve alcohol, effectively increasing the tax on meals in such places from 5 percent to 7 percent.

King originally had proposed raising Maine’s tax on meals and lodging from 7 percent to 7.5 percent, without expanding its breadth.

The change would raise revenue by an estimated $28.6 million for the biennium, about $14 million more than the governor’s original proposal, according to King aide Kay Rand.

As with the original proposal, some of the new revenue would be used to boost the state tourism budget from $4.7 million to $7.2 million per year.

Appropriations panelists, despite some Democratic misgivings, have given the go-ahead to an unspecified 10 percent cut in human services programs financed by the Fund for a Healthy Maine, which draws money from Maine’s share of a national tobacco settlement.

Democratic lawmakers say the cuts would amount to about $11 million, compared with $35 million sought by the governor.

That action, too, was termed preliminary.

“It’s going to get worse before it gets better,” Democratic Rep. David Etnier of Harpswell, an Appropriations Committee member, warned his rank-and-file party colleagues.

House Minority Leader Joseph Bruno, R-Raymond, stressed the preliminary nature of agreements thus far, saying Democrats needed to back further spending trims to match Republican acquiescence on taxes.

“We still need to see some more cuts,” Bruno said, adding, “I’ve been assured that they will reach back in there.”

House Speaker Michael Saxl, D-Portland, noted Thursday that major items still to be addressed include an unpopular King initiative to reschedule plans to pay down the state’s pension fund liability and the disposition of $50 million set aside in a school technology fund.


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