Republican lawmakers are embracing calls from Democratic Gov. Janet Mills to send $850 checks to help taxpayers cope with skyrocketing prices for such essentials as food and fuel, putting them at odds with their party’s nominee for governor, who has called the proposal “an election-year gimmick.”

Debate in the Legislature has shifted from whether to issue the payments to the timing and method. Some Republicans have even called for expediting the payments and expanding the number of taxpayers who qualify to receive them.

Mills first proposed returning half of a projected state budget surplus of $822 million to roughly 800,000 taxpayers during her State of the State address in February and credited Republicans with the idea. After the state’s nonpartisan revenue forecasting group projected an additional $422 million surplus, Mills proposed increasing those checks from $500 to $850.

Republicans did not immediately embrace the governor’s proposal. And former Gov. Paul LePage, who is challenging Mills in November, has continued to call the proposal “an election year gimmick.” He accused Mills of “trying to buy the election,” predicting the checks would be sent shortly before the election.

LePage has instead called for income tax cuts, which account for about 40 percent of state revenues, even though revenue forecasters have warned that the projected surplus, fueled by an influx of federal funding and higher consumer spending, may not carry over into future budgets.

The Legislature’s Appropriations and Financial Affairs Committee discussed the checks Monday during a presentation by Kirsten Figueroa, the commissioner of the Department of Administrative and Financial Services. Figueroa told lawmakers the state would begin issuing checks to qualified taxpayers as soon as possible, but no later than June 30. And people who don’t typically file tax returns would have until Oct. 31 to do so and qualify for payments.

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The committee’s leading Republican, Rep. H. Sawin Millet, of Waterford, questioned Figueroa about whether Maine Revenue Services could make the payments more quickly through direct deposits, rather than sending paper checks through the mail. He noted that many state employees, as well as state and teacher retirees, already accept direct deposits from the state.

Gov. Janet Mills, shown in June 2021, is proposing sending direct payments of $850 to qualifying Mainers. Robert F. Bukaty/Associated Press

REPUBLICANS WANT PAYMENTS SOONER

“I’m wondering,” Millett said, “if MRS and your controller and others could be looking at those existing files above and beyond the income tax files just to see if we can’t cut through some of the administrative costs, the paperwork and the delays by getting more of the inflation-related money into the hands of people who are struggling the most, hopefully well in advance of June 30.”

Millett’s inquiry followed a proposal made by Republicans Friday to amend a bill and require the state to send $850 checks out in electronic form shortly after approval. But committee Democrats quickly voted to table the Republican proposal because they had not seen a written copy of the proposed amendment.

“We want to return taxpayers’ money now,” committee Republicans said in a written statement Friday. “Rather than wait for the Legislature to complete work on the supplemental budget, Republicans want to vote on a bill that could get money back in pockets months sooner. This is money that could be spent putting fuel in the tank to heat your house or drive to work. It shouldn’t be held hostage by Democrats who would prefer to spend it on growing government.”

Figueroa said that even though the state had previously sent out payments to people who worked during the pandemic, the state would have to reprogram its computer system to even send paper checks. She suggested that additional programming would be needed to send payments electronically.

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Electronic payments also would present other challenges, she said, noting that some tax refunds are routed to professional tax filers, so an extra layer of review would be needed to make sure the money went to the right person. Figueroa also said that about half of the 800,000 people eligible for the payments have provided bank account information to the state and that about 49,000 people have since changed their accounts.

“If we send a payment to the wrong account it will never come back,” she said.

Under questioning from committee Democrats, Figueroa said the administration believes that paper checks are the most reliable way to get the money to the people they’re intended to help and that further programming could lead to a possible delay in issuing the payments.

But Figueroa did not entirely slam the door shut on providing electronic payments. “We’re not ready to say whether we can or cannot use the electronic option,” she said.

LOOKING TO INCLUDE MORE TAXPAYERS

Meanwhile, some Republicans also are looking to extend the payments to more taxpayers.

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Under the governor’s proposal, payments would go to 800,000 taxpayers who earn less than $75,000 as individuals or $150,000 as households.

Last week, Republicans noted that 56,000 taxpayers were being excluded from the payment program. On Monday, Rep. Patrick Corey, R-Windham, asked the commissioner whether the administration planned to include more people.

“While I’m for returning money, even increasing payments for many Mainers, I’m not sure why this was not expanded to the 56,000 Mainers left out when more money became available,” Corey said. “Is there a plan to help out these taxpayers who are impacted by the cost of inflation as well?”

Corey also questioned the rationale behind $850 checks, noting that the state economist estimated that the average Mainer would pay more than $560 more for food, gasoline and home heating oil this year because of inflation.

“We’re now talking about $850 for payment – almost $300 over the economic inflation impacts the average Mainer will feel,” Corey said.

Figueroa said the income eligibility guidelines have not changed. She also clarified that the $560 estimate only includes added costs for  groceries, oil and gas. “The impact will be more than that in other areas but we were just able to highlight the grocery and the oil impact,” she said.

The Appropriations Committee will meet again Wednesday to continue reviewing funding recommendations from the Legislature’s joint standing committees.

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