November 26, 2012

Democratic Legislature will re-evaluate tax cuts

The new majority also promises debate on Republican-initiated reductions to MaineCare.

By Steve Mistler
Staff Writer

(Continued from page 1)

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Incoming Speaker of the House Mark Eves, D-North Berwick, has indicated that unfunded Republican-initiated tax cuts need to be re-evaluated for the next budget.

File photo/The Associated Press

Newport Rep. Kenneth Fredette, the incoming House Republican leader, says he will let the Legislature's budget-writing committee deliberate before discussing negotiable items.

Contributed photo

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According to the forecasting commission report, sales tax collections were $13 million below estimates and corporate taxes were $14.5 million down.

Rep. Peggy Rotundo, D-Lewiston, one of the lead Democrats on the Legislature's budget-writing committee, said the lower-than-expected revenues, combined with $10 million in Medicaid cuts passed by the Republican majority but unlikely to receive federal approval, will most likely necessitate a supplemental spending plan to balance the current budget.

Fredette agreed, saying the supplemental budget could range anywhere between $50 million and $200 million depending on what happens with federal revenue reductions via the "fiscal cliff."

"It just goes to show how delicate the economy is right now," Fredette said.

He added, "To say this is serious is an understatement."

LePage's finance commissioner, Sawin Millett, told Capitol News service that the governor's two-year budget will be presented to the Legislature in early January and that a supplemental plan to plug the gap in the current budget would follow.

Budgetary matters could set the tone for a legislative session seemingly set up for conflict between the Democratic majority and LePage.

Democrats haven't announced any policy initiatives, but have hinted that work force development, education and health care are on their wish list.

Changes to the Republican-backed health insurance law that was passed over the objection of Democrats in 2011 will likely be proposed. Democrats campaigned against the law, which early indications show has driven up rates for some small-business owners and rural residents.

Democrats may seek changes to the rules that have prompted those increases. It's too early to tell whether Republicans will support the changes, but several lawmakers have noted that the rate increases in the current law had hurt them in their districts.

Democrats may also seek to change a portion of the law that bolsters the review process for proposed rate hikes by insurance companies.

Newly elected lawmakers will be sworn in Dec. 5. Committee assignments will be determined before the Legislature convenes in early January.

Staff Writer Steve Mistler can be contacted at 791-6345 or at:



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