Gov. Janet Mills is set to deliver a State of the Budget Address before a joint session of the Legislature Tuesday night, kicking off negotiations over the final two-year budget of her two terms in office.
The annual speech, which is called a State of the State Address in off-budget years, is sure to include appeals for the Legislature to support the governor’s budget priorities, including free community college tuition and continued state support for public education.
The address also comes just over a week after President Donald Trump returned to office and signed a series of executive orders that seek to root out disloyal federal employees, clamp down on immigration and conduct mass deportations for people who are in the country illegally.
Mills could use her primetime address to respond to the early actions of the second Trump administration — she actively campaigned for his Democratic opponent, former Vice President Kamala Harris. But in December, Mills made it clear she’s approaching Trump’s second term with caution, telling the Press Herald she will work with the president when his policies benefit Mainers and oppose them when they do not.
Mark Brewer, chair of the political science department at the University of Maine, doesn’t expect Mills to focus too much on the Trump administration, other than perhaps to reassure Mainers she will look out for their best interests. Instead, he believes Mills will respond directly to those already digging in against her budget plan.
“I think she will go after her critics,” Brewer said. “Why wouldn’t you? Nobody else has a soapbox like this one, so you might as well use it.”
Mills unveiled her budget proposals earlier this month. Republicans immediately panned her proposal, which increases state revenues, saying at a news conference that they would not support any budget that increases taxes. And the spending plan has drawn criticism from some progressive advocates and a muted response from her own party, with leaders saying they plan to carefully review her proposal.
The governor’s address begins at 7 p.m. and will be livestreamed at pressherald.com.

Gov. Janet Mills administers the oath of office at the House of Representatives last month. She will return to the House Chamber Tuesday night to deliver a State of the Budget Address to a joint session of the Legislature. Derek Davis/Portland Press Herald
Mills spokesperson Ben Goodman said the governor will discuss the difficult choices needed to continue investing in popular programs, including her proposals to increase state revenue through targeted tax increases. Mills has said she opposes broad-based increases in income or sales taxes, but has included tax hikes on things such as cigarettes and online streaming services.
Mills will also call for good-faith budget negotiations from both parties, Goodman said.
“She will discuss the difficult choices behind her proposal and recognize that lawmakers are beginning to experience the same feelings she had when she was putting it together,” Goodman said. “In the end, her budget attempts to take a balanced approach by adopting both spending cuts and targeted revenue increases to maintain programs everyone supports, and she will encourage lawmakers to do the hard work, to negotiate constructively and in good faith, and, ultimately, to be willing to make the tough choices needed to enact a balanced budget.”
As state revenues continually exceeded expectations since the pandemic, Mills warned lawmakers from both parties about making long-term spending decisions with what the administration described as one-time revenues.
She largely got her way, issuing rounds of direct checks to taxpayers, fending off Republican calls for tax cuts and tempering new spending requests from her fellow Democrats, who spent $107 million in proposed savings last year.
After giving consistent warnings about a difficult budget environment with flattening revenues and increased costs, Mills is proposing to increase state revenue by rolling back tax cuts for retirees and increasing taxes and fees on items ranging from cigarettes, to cannabis, to ambulances, to fishing licenses.
With the details of her proposal already public, Mills will likely defend her budget from criticism and argue that the new revenues are needed to maintain bipartisan accomplishments — meeting a voter mandate to provide 55% of public education funding and expand MaineCare, the state’s Medicare program; fully funding 5% revenue sharing with municipalities; free school meals; and two years of free community college.
“I know that each of you share my commitment to preserving key programs and services that Maine people count on and to enacting a fiscally responsible biennial budget proposal,” Mills said in a Jan. 14 letter to legislative leaders. “I am confident that — as we have done before — Republicans, Democrats, and independents can come together to do what is right for Maine people.”
Nicholas Jacobs, who teaches political science at Colby College, is interested in seeing how Mills sets the tone with her own party, which has enacted baseline budgets without Republican support and challenged the governor by pushing for new spending initiatives.
“One thing I’ll be looking for is whether Mills anticipates any intraparty tensions among her fellow Democratic lawmakers,” Jacobs said. “Democrats, particularly in the House, have been less fiscally frugal than Mills in the last few budget cycles. With a pretty bleak economic assessment, it is an open question whether they’ll go lockstep with their governor on any necessary cuts and reforms.”
Hospital leaders have expressed concerns with the budget, which proposes rate cuts for hospital-affiliated doctors, nurse practitioners and other health care providers. The proposed rate cut of about 36% for Medicaid services would cost hospitals — primarily larger ones — an estimated $24 million year starting in 2026.
Nonprofits have also expressed concerns about a proposal to freeze cost-of-living increases for direct care workers under the state’s Medicaid program.
Senate President Mattie Daughtry, D-Brunswick, said she expects to hear Mills’ pitch to support her proposal and preserve her priorities. “I will be looking for the governor to make the case for her proposal tomorrow, as the next step is for the Legislature to consider every single element of the state budget,” Daughtry said in a written statement.
While Mills has expressed hope for a bipartisan budget this year, Republicans have already dug in against her plan.
“I want to hear a new proposal from her that doesn’t involve increasing taxes on a state that’s already overtaxed,” said Senate Minority Leader Trey Stewart, R-Presque Isle.
Mills has proposed a $1 a pack increase on cigarettes, a 40% increase in cannabis sales taxes and extending the state sales tax to include a wide variety of streaming services, including Netflix, Spotify and Zoom. She also proposed new taxes on private ambulance services and on prescription drugs, which are aimed at raising federal revenue. And she has proposed rolling back new pension tax deductions for wealthy retirees, beginning with individuals who earn more than $100,000 in taxable retirement income.
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