AUGUSTA, Maine — The Legislature is set to reconvene Tuesday to take up an anticipated veto of the state’s next two-year budget by Gov. Paul LePage.
LePage has until midnight Monday to veto the measure, which provides for $6.7 billion in spending and modifies the state’s tax code, reducing the income tax and maintaining a 0.5 percent increase in the sales tax, keeping that tax at 5.5 percent, which was enacted as a temporary measure in 2013.
The Republican governor told a reporter from the Maine Public Broadcasting Network he would issue his veto message by 5 p.m. Monday and it would be something the press would not want to miss.
The bill, which must be enacted by Wednesday for lawmakers to avoid a government shutdown, is the result of months of negotiations, some behind closed doors, which saw Republicans in the state Senate ultimately split with LePage on his proposal to increase and broaden the sales tax in order to reduce the state’s income tax and eliminate its estate tax.
Legislative Democrats, who control the House of Representatives by 10 votes, stuck to their position that any income tax breaks be focused on the middle class. They also insisted that the state’s homestead exemption, a property tax relief program, be increased and kept in place for all homeowners.
Under the current program, the first $10,000 of a primary home’s taxable value can be exempted from property taxes.
LePage wanted to double the amount of the exemption from $10,000 to $20,000 and to limit eligibility to households with at least one resident who was 65 or older. The Democratic proposal increases the exemption amount to $20,000 but allows it for all households currently eligible for the exemption.
The bill reduces the state’s top marginal income tax rate from 7.95 percent to 7.15 percent.
Other key provisions in the new state budget include:
— An $80 million increase in the amount the state sends to K-12 public schools under its General Purpose Aid formula.
— A $10 million increase in a scholarship fund aimed at helping Maine students and workers pay for college through the Maine State Grant program.
— A $28 million increase for the Maine Community College System and University of Maine.
— An $11 million increase in funding for the community college system for job training programs for Maine workers.
— An elimination of the “welfare cliff” by allowing those receiving state welfare benefits to have their benefits gradually reduced as they gain income and employment, instead of a system that ends benefits as soon as a recipient earns $1 more than the income guidelines that make them eligible for assistance.
— About $62.5 million per year in state revenue sharing to Maine cities and towns.
— About $48 million for the state’s Drugs for the Elderly and Medicaid Savings programs, which help low-income seniors pay for prescription drugs.
— A $16 million increase in state funding for nursing homes, bringing the state’s total to $216 million over the two-year budget cycle.
— A $16.2 million increase in funds to help clear Department of Health and Human Services’ waitlists for people with intellectual disabilities and brain injuries.
— The elimination of the state income tax on military pensions.
— Funding for four new agents for the Maine Drug Enforcement Agency. The budget also allows $200,000 in federal grant money to be used at the MDEA’s discretion for additional hiring or investments in other anti-drug efforts.
— Increases to the state’s sales taxes on hotel and motel lodging and restaurant meals. The lodging tax increases to 9 percent by the end of 2017 and the tax on restaurant meals will remain 8 percent — the meals tax was scheduled to return to 7 percent on July 1.
Early this month, LePage used his executive authority to veto 64 single lines in the budget. Over a two-day period, lawmakers quickly overturned each of those vetoes with majority votes in both the House and the Senate.
If LePage vetoes the overall spending package, lawmakers in the House will take up the override vote first on Tuesday before sending the bill back to the Senate. If all members of the House are present Tuesday, they will need 101 votes to overturn LePage’s veto. The state Senate, if all 35 members are present, will need 24 votes.