State Democrats reject GOP spending cap

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AUGUSTA – The potential for reaching a bipartisan solution for property tax relief faded Thursday after Democratic leaders said they would refuse to consider a Republican-crafted cap on state spending.

The Legislature’s Joint Select Committee on Property Tax Relief has deferred votes on government spending caps during meetings this week and probably will not take up the issue until today. Although House Speaker John Richardson, D-Brunswick, told state representatives assigned to the 15-member committee that he wanted a vote on the conceptual tax relief plan today, some committee members were preparing to meet over the weekend if necessary to reach agreement on a proposal.

The prospects of a later-rather-than-sooner preliminary vote increased after Richardson told reporters Thursday that he could not support GOP demands for a two-thirds override requirement in order to exceed a cap on state spending. Senate President Beth Edmonds, D-Freeport, agreed that the supermajority threshold was “unnecessary.”

Republicans, who are outnumbered by Democrats by only three seats in the House and two in the Senate, see the cap override provision as their best hope to end majority budgets in a Legislature controlled by Democrats for decades.

If both sides agreed to a supermajority requirement to override the limits of the cap, the majority party would need the support of the minority in order to exceed spending restrictions. The braking mechanism is opposed by Democratic Gov. John Baldacci, Edmonds and the House speaker.

“I’m not interested in getting into a philosophical debate about two-thirds or a simple majority when I know that has no support within the Democratic caucus,” Richardson said. “I think that what we really need to do is concentrate on what’s possible, and let’s get away from political posturing and move forward.”

Assistant House Republican leader Josh Tardy of Newport and Senate GOP leader Paul Davis of Sangerville chafed at the suggestion that either Richardson or Edmonds was in control of determining what was “possible” in what was heralded by all parties as a bipartisan approach to tax reform.

“It sort of sounds like ‘drop dead’ to me,” said Davis. “I disagree with 100 percent of everything the speaker said. We think a two-thirds cap is needed.”

Tardy said Mainers had made it clear in statewide votes over educational funding and tax caps that many voters believe there is a spending problem at the State House and that Maine can barely maintain the social programs it has, let alone develop new ones.

“It’s clear that, without some obstacle that keeps the Legislature within some bounds of financial discipline, [a cap] is not meaningful,” Tardy said. “We think the people of Maine want meaningful spending reform. Republicans have tried to be productive in this process and not be viewed as obstructionists and negotiated in good faith, but we have some serious philosophical differences and disagreements on what we think Maine people want.”

Rather than the “spending problem” that Davis and Tardy maintain the state is experiencing, Richardson insists that Maine is on the receiving end of a federal revenue problem.

“Right now we’re being devastated by the Republican administration and the Republican Congress that is not providing a sufficient amount of money to fund the social programs that are the safety net for Maine people, and we’re doing our best to respond to it,” he said.

While hoping the legislative committee will return a unanimous report on the governor’s property tax bills, Edmonds and Richardson said they could accept an 8-7 vote from the panel if it meant the Democratic proposal would prevail. Both said it was “more important to get the job done” than to argue about two-thirds votes that Richardson characterized as “inside baseball” for most Mainers.

The House speaker suggested Republicans who rejected a spending cap that could be exceeded by a majority vote would have some explaining to do at election time.

“So [the Republicans] are going to vote against increased education over the fact that we don’t have a two-thirds override provision even though we have spending caps?” he said. “I don’t think that’s where Maine people want us to be. I think Maine people at the end of the day are going to say, ‘You better support increased funding for education that’s going to provide me with property tax relief.”‘

Tardy countered that Democrats could be the ones paying the price at the polls if they fail to address the state’s spending problem effectively.

“[The Democrats] have the ability to go into each chamber and put up their green lights, and they’re going to own [the tax reform bill] if they’re not going to negotiate,” he said.

Other developments on property tax relief Thursday found committee members taking straw votes on which tax relief elements should be in the final package. Four major agreements included:

. Commitment to ramping up the state’s share of local education funding to 55 percent over four years, as called for in the governor’s proposal, rather than two years as suggested by some Republicans.

. Beefing up the state tax and rent rebate program known as the circuit breaker by increasing income eligibility and expanding the maximum benefit from $1,000 to $2,000.

. Increasing the Homestead Exemption by eliminating the current tiered system and increasing the maximum exemption from $7,000 of valuation to $12,000. Funding the benefit to taxpayers would be shared jointly by the state and municipalities.

. Agreeing to send out a constitutional amendment to allow municipalities, at their option, to charge a different mill rate for second homes than for primary residences. The rate for second homes could not be more than 20 percent higher than the standard mill rate for the town. Also, municipalities that charge a different rate for second homes would have the option of exempting a portion of the value of those properties, but would not be required to do so.

A group of officials representing Maine’s 16 counties also met at the State House Thursday warning that the governor’s spending cap for county governments left them ill-prepared to deal with the unpredictable expenses of maintaining county jails. The officials are hoping the state will find a way to increase funding for the maintenance of jail facilities and prisoner costs.

“I don’t think the general public realizes how much the jails are costing us, and I think that’s an issue that people have to become aware of and become part of the wider discussion,” said Edmonds. “We’ll wait and see what the committee does about that, but I know they’re willing to think about that.”

Meanwhile, a new group including former gubernatorial candidate David Flanagan entered the fray, traveling throughout the state Thursday – including a stop at the State House – to push its own plan to reform Maine’s tax code.

The group, the Coalition for Reasonable Tax Relief for Maine, outlined a strategy similar to that of the Maine State Chamber of Commerce, proposing spending caps that would require a two-thirds legislative supermajority to override. The coalition’s plan, however, differs from the Chamber’s plan in one notable way. While the spending caps – a 2.75 percent limit on state and local spending increases – would be written into law, as is the case with the Chamber’s plan, the two-thirds threshold needed to override or amend the cap would become part of the constitution.

“The cap won’t be credible without the two-thirds vote,” Flanagan said in a Thursday interview with the Bangor Daily News editorial board.

The distinction, Flanagan explained, would allow two-thirds of lawmakers to change the spending caps without a majority of voters approving after the fact, as would be the case if the rate itself were written into the constitution. The subsequent popular vote, which some lawmakers consider onerous particularly in times of emergency, is mandated by other proposals including the Taxpayer Bill of Rights citizen initiative being advanced by Garland activist Mary Adams.

NEWS writer Jeff Tuttle contributed to this report.