Leadership briefed on budget updates

AUGUSTA – The King administration has been consulting with leaders of the four partisan legislative caucuses, Democrats and Republicans in both the House and Senate, outlining what uses it might propose for $91 million in newly booked state revenue.

Top King aide Kay Rand said the administration was also trying to determine the top priorities of lawmakers in advance of unveiling new proposals this week.

According to briefing materials obtained by The Associated Press, the discussions have centered on more than $27 million in potential budget restorations on top of another $25 million in possible add-backs already identified by Gov. Angus King.

Rand said that the list was still evolving and the administration also would hope to effectively bank more than $25 million in the state Rainy Day Fund.

A new King proposal expected within a few days would significantly revise the supplemental budget plan that King put forth Jan. 8.

That package was designed to adjust spending to cover a $248.6 million revenue shortfall in the $5.3 billion budget enacted last year for the two-year cycle running through mid-2003.

Last Thursday’s upward revenue reprojection of $91 million substantially eased, but fell far short of eliminating, the necessity of reducing current levels of program spending and tax expenditures.

The administration is now looking to scrap a variety of proposed social service cutbacks and to move ahead with anticipated tax reductions that would have been delayed in the Jan. 8 package.

King also wants to scale back his original proposal to virtually drain the $100 million Rainy Day Fund.

Rand said Friday the administration was hoping to promote the two-thirds House and Senate approvals that would ensure a supplemental budget package could take effect immediately upon enactment.

Failure to win the backing of super majorities in both legislative chambers could delay implementation of spending revisions, effectively reducing desired savings.

King’s January budget-balancing package avoided general tax increases and cuts in public school subsidies and called for boosting spending in some areas by $18 million.

At the same time, in addition to seeking a transfer of $98 million from the Rainy Day Fund, it envisioned a variety of curbs on payments to medical care providers, including hospitals and nursing homes.

Among other targets were mental health services for children.

King further proposed a delay in individual income tax indexing.

Even as he offered that package, the governor said he would withdraw such proposals if new revenue became available.

When that happened last week, the administration began talking about more restorations, including a move to fully conform state tax laws with federal changes advantageous to taxpayers.

According to briefing materials, also under discussion is the retention of planned spending for other mental health and mental retardation programs and for other social services, including expanded Medicaid coverage and measures to address domestic violence.

One suggestion would boost aid to local schools to offset costs associated with students in the care of state agencies.

Appropriations Committee lawmakers also have been told a child welfare initiative carrying a potential cost of $10 million is being discussed.

King is scheduled to return to Augusta in the middle of the week after a trip to Washington for a winter meeting of the nation’s governors.