Gov. Paul LePage said Tuesday morning on radio that his upcoming two-year budget proposal will seek to cut income taxes without increasing the sales tax.
It’s a departure from the Republican governor’s budget proposal nearly two years ago, which proposed an income tax reduction balanced with a sales tax increase. Many Republicans didn’t like the sales tax changes and the Legislature passed a compromise budget over LePage’s veto.
Because of that, LePage told WVOM on Tuesday that he wouldn’t be proposing sales tax changes. However, he said he’s still looking to cut Maine’s top income tax rate of 7.15 percent, which isn’t possible without “major cuts.”
“We had some meetings yesterday — all day, in fact — on budgets and I tell you, it was hard to sleep last night knowing what has to be done in order to protect the economy,” LePage said.
Other than the governor’s piecemeal disclosures, the administration hasn’t disclosed many details of the next budget proposal, which will be unveiled in January after legislators return to Augusta for the new session.
We have seen at least one proposal that could be described as a major cut: This summer, an administration memo leaked saying LePage had a goal to cut Maine’s state workforce to 9,500 from its current level of nearly 12,000 in the budget.
When pressed for clarification on those positions, the administration said it would be reviewing 2,400 limited-period positions with effective end dates, but a review of those positions found that many employees are longtime bureacrats. Many programs would likely have to be scaled back if a large number of them go.
So, while the politics of a sales tax increase are difficult, it’s hard to see how major cuts in state government would be more palatable to the Legislature.
In other news on the radio, LePage said:
Democratic legislative leaders’ rejection of a new mental health facility on state grounds is a “first shot across the bow.” The procedural move last week in the Legislative Council made it so the administration can’t build a new, $3 million forensic psychiatric unit next to Riverview Psychiatric Center on Augusta’s east side. But LePage said he’s now looking at sites in Freeport, the Bangor area and “down south” to build the facility, saying, “I’m going to get it, but it’s not going to be next to Riverview, so we’re not going to be able to use the same staff.”
He won’t include money to regulate Maine’s new legal marijuana market in the budget proposal. LePage, who opposed Question 1 on the November ballot, said his agriculture department will need between $3 million and $5 million to oversee the market, but he won’t put it in his budget, saying he’ll “let the Legislature deal with it.” He proposed increasing the 10 percent tax on marijuana under the law and taxing medical marijuana. LePage’s fiscal estimate is higher than the Legislature’s fiscal office, which said the state would need $2.5 million to administer the law through 2018, assuming the law is implemented then.
He said he’ll be “very quiet” this session, do as much as he can from the executive branch and avoid fighting with the Legislature.
Send questions/comments to the editors.
