Amid High Costs, Governor Mills Proposes Increasing Direct Relief for Maine People

Governor also commits more funding to strengthen behavioral health system, address PFAS, and bolster emergency housing services

Governor Janet Mills today proposed a change package to her supplemental budget that increases the amount of direct relief to Maine people in the face of inflation, strengthens Maine’s behavioral health system, bolsters housing initiatives to fight homelessness, and advances the State’s effort to support farmers impacted by PFAS, among other initiatives.

The change package builds on the Governor’s commitment to tackling the state’s most pressing problems while also investing in solutions that will strengthen the state in the long-term. It comes after Maine’s nonpartisan Revenue Forecasting Committee (RFC) upgraded the State’s General Fund revenue forecast by an additional $411.7 million for the current biennium, which ends June 2023, but takes a cautious, fiscally responsible approach, dedicating most of the surplus to one-time initiatives rather than ongoing spending, noting that the RFC has said the long-term revenue projections are “volatile and susceptible to significant downside risk” in the years to come.

The Governor’s change package proposes increasing the State’s relief checks to Maine people to $850 in the face of record high inflation and rising oil and gas prices caused by Russia’s invasion of Ukraine. The Office of the Maine State Economist estimates that inflation will cost the average Maine person more than $560 this year than last, which includes an extra $260 at the grocery store and $300 for gas and home heating oil. The Governor’s new proposal would return $1,700 in relief to the average Maine household.

“Inflation and increased oil and gas prices resulting from Putin’s invasion of Ukraine are hitting Maine people hard. This proposal will help Maine people grapple with these increased costs by putting money directly back into their pockets,” said Governor Janet Mills. “From direct relief to investments in behavioral health, this revised budget proposal helps Maine people through this difficult time, tackles pressing problems, and lays the foundation for strong economic growth. I know the Legislature shares my commitment to addressing these issues, and I look forward to working with them to pass this proposal as quickly as possible and in a strong bipartisan manner.”

“This proposal balances Maine's budget and delivers much-needed relief to Maine people in a way that protects both our citizens and the State’s fiscal stability against future economic downturns,” said Kirsten Figueroa, Commissioner for the Department of Administrative and Financial Services. “We will continue to act cautiously, delivering much-needed relief to Maine people and investing in long-term solutions while maintaining the State’s solid financial position.”

Highlights of the Governor’s change package include:

  • Giving back more than half of the State’s surplus – $682 million – in the form of one-time $850 checks directly to an estimated 800,000 Maine people, consistent with the calls of Republican lawmakers (PDF). Delivering relief in this way provides Maine people with the freedom to decide for themselves how best to use the money, whether it be for groceries, gas, heating fuel, electricity, or other expenses;
  • Dedicating $19.7 million in General Fund dollars, which would leverage $17.1 million in Federal funding, for a total of $36.8 million to bolster Maine’s behavioral health system;
  • Dedicating $1.75 million in one-time General Fund dollars, which would leverage $1.75 million in Federal funding, for a total of $3.5 million to save the Maine Veterans Homes in Caribou and Machias;
  • Increasing from $2,000 to $2,500 the annual benefit of the Education Opportunity Tax Credit (“Opportunity Maine”), as part of the Governor’s proposal to overhaul and transform it into a powerful, nation-leading tool to retire student debt for graduates and help employers to draw people from all walks of life to work and live in the State of Maine;
  • Dedicating an initial $60 million in one-time General Fund dollars to capitalize a Trust Fund to Address PFAS Contamination, consistent with the intent of LD 2013 and with the goal of securing additional Federal and other sources of funding in the long-term;
  • Dedicating $22 million in one-time General Fund dollars to create an Emergency Housing Relief Fund at MaineHousing to address homelessness, including providing rental assistance or appropriate housing for those who are staying in hotels or to create additional permanent supportive housing for people with disabilities, mental health challenges, or substance use disorder;
  • Dedicating $3.2 million to offset increases of the cost of materials and supplies for Maine’s Career and Technical Education Centers (CTEs);
  • Dedicating $1.9 million to the annual budget for Maine’s County Jails, consistent with the intent of LD 1654;
  • Dedicating an additional $2 million, for a total of $3 million proposed in the supplemental, to support the ongoing legal defense of Maine’s lobster industry;
  • Dedicating $536,000 to the Elections Division within the Secretary of State’s Office, consistent with the intent of LD 1155;
  • Leaving an additional $8 million, for a total of $20 million, unallocated and at the discretion of lawmakers.

In all, the Governor’s supplemental budget proposal returns more than half of the surplus back to Maine taxpayers, delivers crucial tax relief to working Maine families, increases pay for child care workers, and provides two years of free community college to pandemic-impacted students to strengthen Maine’s workforce.

It also increases the Budget Stabilization Fund to more than $500 million, the first time in Maine history that state savings has ever surpassed a half billion dollars, and provides $100 million to the Maine Department of Transportation to fix roads and bridges, increasing an unprecedented level of General Fund support.

View a complete summary of the Governor’s revised supplemental budget proposal (PDF).

The proposal is balanced and builds off a previous budget measure passed nearly unanimously by the Legislature that achieved 55 percent of the cost of education, fully restored revenue sharing with municipalities, replenished the Land for Maine’s Future Program, and provided more than $371 million in relief to Maine people and Maine businesses – including sending $285 checks to more than 500,000 Maine people.

This proposal comes on the heels of other recent relief action taken by the Governor to help Maine people tackle rising costs, including: providing $800 in heating cost relief sent to nearly 13,000 low-income households to help pay for high energy costs, securing a one-time bill credit of $90 for eligible CMP and Versant customers, working with MaineHousing to increase the allowable benefit amount for its Energy Crisis Intervention Program from $600 to $1,400, and providing up to $1,400 (PDF) for eligible low- and middle-income Maine families and seniors via tax relief measures signed into law by Governor Mills.

It also complements the Governor’s Maine Jobs & Recovery Plan, her Administration’s plan to use American Rescue Plan Act funding to improve the lives of Maine people and families, help businesses, create good-paying jobs, and build an economy poised for future prosperity.

The Governor’s supplemental budget proposal constrains net appropriations to just $172 million of the $1.2 billion surplus, dedicating more than 80 percent of the surplus to one-time initiatives and savings as a hedge against economic uncertainty, rather than ongoing spending. If approved, the proposal would result in a $8.67 billion General Fund budget. The currently enacted General Fund budget is $8.5 billion.

The change package proposal will be available on the Bureau of the Budget website by the end of the day.