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House and Senate pass laws to create jobs, increase access to health care, and reduce tax burden
June 13, 2009
Augusta, ME—The Maine Legislature finished up a successful, challenging and productive session on Friday when the House and Senate adjourned for the year, 4 days ahead of its scheduled adjournment date, June 17th.
At a time of economic uncertainty and difficult decisions for state government, the Legislature was able to make a number of positive steps forward on some of the major issues facing the state. The Legislature took up a number of meaningful topics when many critics argued that any move forward wouldn’t be in the best interest of the state. Instead, legislators forged ahead on a number of key proposals that will improve the state’s economic health, increase access to health care and reduce the tax burden on Maine people.
"Recognizing the dire nature of our economy, legislators from both parties worked together this session to solve the problems before us. Whether it was closing the historic budget hole, improving our health care system or developing a plan for Maine’s energy future, legislators worked to solve the problems of Maine people rather than dig their heels in to score political points,” said Senate President Elizabeth Mitchell.
Every piece of legislation that was considered during the session was examined on the basis of what was possible financially. The economic recession cast a shadow over the work of the Legislature, as evidenced by the months of work on the state budget. The accomplishments made were done in spite of the fact the economic downturn severely limited the financial resources of the state.
“This was an incredibly productive session that produced landmark legislation on energy policy, tax reform and civil rights,” said Speaker of House Hannah Pingree. “I am incredibly proud of the members of this legislature. They all rose to the challenges before them and met them head on. The economic recession presented unprecedented difficulties, but we were able to find bipartisan solutions to ensure a bright future for Maine.”
There were several major accomplishments during the legislative session which address a number of different issues in Maine.
Energy Investment — The Legislature passed a landmark, sweeping energy package that included money for renewable energy, weatherization and workforce development programming in emerging green industries. The legislation, L.D. 1485, "An Act Regarding Maine's Energy Future," was the product of the Joint Select Committee on Maine’s Energy Future, a committee that was formed especially this year following last summer and fall’s energy crisis. The Committee’s recommendations focused on consolidating efficiency programs for homes and businesses under one roof and establishing ongoing weatherization efforts.
In 2008, Maine spent $1.5 billion year for fuel oil, 85% of which left the state. Some estimate that 20-30% of that money spent on heating fuel was wasted due to lack of weatherization in Maine homes and businesses. The Joint Select Committee met through out the winter and spring to consider a number of bills with a wide range of concepts and initiatives aimed at addressing various aspects of Maine’s energy use. Ultimately, the Committee dispatched all of those bills and crafted a single bill.
LD 1485 created a new “Efficiency Maine Trust” to provide a “one stop shop” for consumers and businesses to access so they can start weatherizing and improving their efficiency and reduce their energy costs. The new Trust will formulate programs and structures to achieve the goals established in the bill including weatherizing 100% of Maine homes, 50% of Maine businesses, and reducing heating fuel consumption by 20%.
The legislation authorizes the expenditure of $79 million in federal economic stimulus funds in order to fund efficiency and weatherization efforts for low and middle income households as well as businesses. The legislation also provides for a study of leasing energy transmission corridors. There will be a Legislative Study Commission to explore the valuation process for energy corridors within the state. The first $50 million of any monies derived each year from any such leases will be dedicated to the new Trust.
Senate Majority Leader Phil Bartlett, Senate Chair of the Select Committee, said, “Maine will now move forward and develop clean energy technology and renewable energy sources with the goal of one day eliminating the dependence on foreign oil. In addition to reducing our carbon footprint, this bill will create thousands of jobs, cheaper power and more efficient homes and businesses.”
Tax reform — Maine has had an unbalanced and outdated tax code for decades, and efforts to reform the contentious issue have failed numerous times in almost every Legislative session. That had remained the case until this session when Leadership from both houses of the Legislature came together on a plan to lower the state’s income tax rate, the 6th highest in the nation, from 8.5 percent to 6.5 percent. The drop was paid for by expanding the sales tax to a number of highly exportable and discretionary services.
The tax reform package that passed the Legislature, L.D. 1495, "An Act To Implement Tax Relief and Tax Reform" will reduce the tax burden on Mainers by $57.1 million, moving it to out of state visitors.
Many legislators have long argued that the state’s top income tax rate of 8.5 percent was an excessive burden on our citizens. The top income tax rate is paid by residents at a very low income level; and sponsored argued that reducing it will help working families across the state who are struggling to make ends meet by putting more money in their pockets.
The authors also argued that the high income tax rate has been a barrier to job creation in our state. By reducing the top rate of the income and capital gains taxes by over 20 percent, sponsors said that investments in Maine projects will now go further and create greater opportunities, and the new code will better use tax policy to ensure this state’s economic viability.
“The passage of a tax reform package that significantly lowers the income tax rate in Maine has been a goal for years,” said House Majority Leader John Piotti. “The Legislature overcame the continuing recession and found a way to pass a number of laws that will improve the quality of life in Maine, including tax reform. It remains a difficult and challenging time, but we found a way to put more money in the pockets of Mainers at a time when they really need it.”
Marriage Equality — The Legislature passed legislation that addresses the inequalities in Maine’s marriage laws, allowing loving and committed same sex couples to get married. Maine joined Massachusetts, Iowa, Connecticut, and Vermont in recognizing civil marriage for same sex couples.
An emotional and extremely personal issue for many Legislators of both parties, the Marriage Equality debate enraptured the state of Maine for months before the Legislature took a final vote on the issue. The Committee on the Judiciary held a hearing on the legislation that lasted for many hours, and attracted 3,000 people from across the state. By all accounts, the hearing was one of the best moments of the legislative session. Those for and against the bill debated the issue in a respectful manner, which also characterized the debate in the House and Senate.
Many members of the House of Representatives spoke in favor of the legislation, L.D. 1020 "An Act To End Discrimination in Civil Marriage and Affirm Religious Freedom," citing the need to grant full marriage rights to same sex couples. Sponsors argued domestic partnership provisions provide only a fraction of the benefits of legal marriage, and there are over 400 references to marriage rights in state statute. Others made the point that many same sex couples attempt to protect rights for themselves and their loved ones through wills and other legal mechanisms, but these couples cannot recreate the same level of rights that heterosexual couples have.
After the hearing and Committee vote the House and Senate took up the issue, voting in favor of the legislation by healthy margins in both houses. The Governor, who had previously opposed same sex marriage, signed the bill.
Bond package — The Legislature approved a $150 million bond package, L.D. 913, "An Act To Authorize Bond Issues for Ratification by the Voters for the November 2009 and June 2010 Elections," which will invest in Maine’s economy and put Maine people to work. All tolled, the package will help to support thousands of jobs and provide an estimated $368 million in economic activity in the state over the coming two years when private and federal matching funds are factored in.
The proposal, which was approved by the Legislature on Friday, would invest in Maine’s transportation infrastructure, put Maine at the leading edge of the green energy revolution, and provide needed capital to help Maine businesses innovate and help Maine communities make needed environmental upgrades. This $150 million package is based upon the framework of the bond plan that Governor Baldacci put forward in March.
The proposal will go to voters for their approval in three phases; November, 2009, June 2010 and in November 2010. Specifically, it would place a $71.25 million transportation infrastructure bond on this November’s ballot. While stimulus funds are carrying much of the construction industry this summer and fall, the bond would allow firms to move forward with planning projects next winter and then execute them in the summer of 2010. The $71.25 million in state funds would leverage an additional $133.23 million in matching funds. The second phase of the package would go to Maine voters for their approval on the June 2010 ballot. This would include a $25 million economic development bond, an $18 million green energy bond, a $10.25 million clean drinking water, wastewater and environmental cleanup bond and a $15.5 million higher education bond. The third round of voting would be for a $10 million conservation bond that would include $7.5 million for Land for Maine’s Future, $2 million for working waterfront and $500K for state park improvements.
Dirigo funding fix — The Legislature passed a bill to protect the current members of DirigoChoice by replacing the current funding system, the controversial “Savings Offset Payment (SOP),” with a more stable funding source that will stabilize the program. The legislation replaced the SOP with a fixed monthly fee that will be paid by the same insurance companies that pay the fee currently, and will not cost any more than they are already paying. It will also reopen the program to accept new enrollees in 2011. L.D. 1264, “An Act to Stabilize Funding and Enable Dirigo Choice to Reach More Uninsured,” was introduced on behalf of the Governor by Representative Sharon Treat, D-Hallowell, House chairwoman of the Insurance and Financial Affairs Committee.
Many of the current problems with the Dirigo program can be traced back to the funding source, which has been a consistent issue since its inception. The Savings Offset Payment has been difficult to administer and would further endanger those currently on the program if continued. The controversy surrounding the financing for DirigoChoice has distracted from the successes the program has achieved. When Dirigo began in 2003, the United Health care state rankings showed Maine ranked 19th in covering the uninsured. In the most recent report, the state ranks 5th. Since the beginning of the program’s operation over 29,000 people have been served.
LD 1264 will allow the program to reopen enrollment by January 1, 2011 with a new more affordable product and provides with more consistent funding so the money available to run the program does not fluctuate from year to year. The bill also charges the Dirigo Board of Trustees to re-design the program to make it more affordable and able to reach more uninsured.
“Stabilizing the funding for Dirigo was an important part of a larger health care reform package passed by this legislature. We are taking significant steps in the right direction and will continue our work to improve access and quality of health care here in our state,” stated Assistant Senate Majority Leader Lisa Marrache. “While our work is not done, we have created policies that will hold down the cost of care, improve the information patients receive and further expand coverage to the uninsured.”
The session was marked by the ongoing downward trend in revenues, which had to be addressed multiple times. Each time there was a new issue with the state budget, the Appropriations Committee worked together to find a way to deal with some of the biggest financial issues Maine has seen in years.
“The work the Appropriations Committee did this session was nothing short of remarkable,” said Assistant House Majority Leader Seth Berry. “Every time there was a new difficult task thrown their way, they responded with hard work and determination to get the job done. I applaud their effort and success in the face of a very challenging situation.”
In a difficult time, the Legislature was able to make a number of gains in some essential areas. From health care to job creation to a new energy policy for the state, lawmakers worked in a bipartisan manner to make advancements on some of the state’s biggest issues.
Contact:
David Loughran, Communications Director, 287-1558 (Mitchell, Bartlett, Marraché)
Tim Feeley, Communications Director, 287-1306 (Pingree)
Kyle Leighton, Communications Director, 287-1433 (Piotti, Berry)