PORTLAND, Maine — Gov. Paul LePage told an audience Tuesday morning his reason for submitting a bill to prohibit municipal minimum wage increases in places like Portland and Bangor, which are considering such proposals, is because higher mandated minimum wages anywhere in Maine would harm older residents.
“The reason for that is that raising the minimum wage is going to have a devastating impact on our elderly, on people with fixed incomes,” LePage said during an event sponsored by the Portland Regional Chamber. “It’s going to be horrible. If there’s one thing I get constant emails on, it’s from elderly people saying, ‘Don’t increase the minimum wage, one of the few luxuries I have is to go get coffee with my friends or lunch with my friends.’”
LePage said such a wage increase would lead to price increases for items such as a cup of coffee and argued that Maine should first eliminate its income tax, a goal he outlined Tuesday in a proposed constitutional amendment.
“I do not think for one second that I’m going to win the battle this year, but I do believe I’m going to win the war in 2016,” LePage said in the talk, which touched on a range of policy objectives the governor has championed since his re-election in November, with his tax plan taking center stage.
LePage has regularly said that he will work vigorously against the 2016 re-election of legislators who oppose his efforts to eliminate Maine’s income tax, reform the state’s tax code and revitalize the economy with conservative initiatives.
The governor has proposed in his two-year budget that the state take a step to reduce the income tax, alongside a sweeping proposal to raise the sales tax rate to 6.5 percent and expand the sales tax base to far more goods and services than are now taxed.
The meals tax, on cups of coffee and lunches, under that plan would drop to 6.5 percent.
The governor’s opposition to raising the minimum wage comes during the longest stretch in which Maine’s minimum wage has not budged since 1960, according to the Maine Department of Labor. The state last increased its minimum wage, from $7.25 to $7.50, in 2009. While the wage hasn’t budged, prices have. Since 2009, the regional consumer price index in urban areas, which measures how the prices of consumer goods change, has gone up 8.7 percent, according to the U.S. Bureau of Labor Statistics.
Mike Tipping, a spokesman for Mainers for Fair Wages and the Maine People’s Alliance, said such a minimum wage law stands to help seniors who remain working.
“Those are folks that the minimum wage increase would help immediately and prices are going up and that’s why you should raise the minimum wage,” Tipping said.
His group last week started collecting signatures for a referendum to raise Maine’s minimum wage to $9 in 2017 and increase annually until reaching $12 in 2020.
The brewing fight over preventing municipalities from passing minimum wage increases comes as the governor calls for consolidation of municipal services,which he reiterated Tuesday and grouped with eliminating the income tax.
“You do a much better job spending your money than government does spending your money,” LePage said, adding that too much money doesn’t force state government to be “efficient, effective and accountable.”
In proposing that Maine eliminate its income tax by 2020, the governor said he expects the state to see economic growth from the gradual reduction in income tax rates through his $6.57 billion, two-year budget proposal, which he has promoted to audiences around the state in a series of public forums.
The governor said he views the tax changes, energy costs and education proposals as important for improving the state’s economy. He has proposed a bill that would provide tax incentives for employers to hire Maine students and another to pay the interest on student loans as long as graduates remain in the state.
“We’re willing to invest in them if they’re willing to invest in Maine,” LePage said.
He also reiterated a view that the Legislature should give his office more staff for drug enforcement, again calling Democrats “weak on drugs.”
He reiterated his focus on reducing energy prices, which he blamed for the demise of paper mills in Bucksport and East Millinocket last year.
“Had the Legislature been proactive and not reactive, we could have saved those mills,” LePage said.
As for the $16 million the state will pay to investors in the now bankrupt Great Northern Paper in East Millinocket, LePage said he was not happy about the deal, which an investigation by the Maine Sunday Telegram revealed did not actually result in any money being invested in new equipment at the mill.
“Am I happy about that? No,” LePage said. “But once you make the deal, you make the deal.”