Maine Gov. Janet Mills greets the Legislature before delivering her State of the State Address from the Maine State House on Thursday, Feb. 10, 2022. Credit: Ben McCanna / Portland Press Herald via AP

AUGUSTA, Maine – Gov. Janet Mills unveiled the details of an $850 million supplemental budget proposal on Tuesday that includes $500 relief checks and would lift state spending to record highs.

The Democratic governor’s proposal has been released in bits and pieces in recent months with Mills teasing high-profile items last week during her State of the State address. Chief among the items is a return of $411 million in surplus revenue to Mainers in another round of checks, something Mills incorporated after legislative Republicans recommended it.

Mills’ plan goes far past that, spending $850 million more in revenue mostly driven by federal aid from COVID-19 relief packages on top of an $8.5 billion two-year budget passed by lawmakers in 2021. That includes $640 million in one-time expenses — such as the checks to 800,000 Mainers — and $137 million in expenses in the regular state budget.

The ambitious plan would use nearly all excess revenue projected through mid-2023 and leave $12 million undedicated, according to state budget documents. Approximately $100 million would be dedicated to roads and bridges. Stabilization funds for Medicaid and K-12 school costs would each get $30 million. Another $30 million would go to health care worker payment rates.

Almost that much would be set aside to continue to pay for free school meals. It includes more money for cost of living increases for state retiree pensions and another investment into the state’s rainy day fund to bring it to a historic $500 million.

The scale is likely to draw reproach from Republicans wary of increasing the state’s bottom line and skepticism about the use of one-time funds. The governor couched the proposal as a way to combat inflation and help the state’s workforce problems. That framing will take center stage for the rest of the year in her November matchup with former Republican Gov. Paul LePage.

Mills called it a fiscally responsible document and highlighted the bipartisan ideas in it in a Tuesday news release. It will now be considered by the Legislature’s budget committee during a fraught election-year session that is set to end in April.

“I look forward to working with the Legislature as they consider this proposal and applaud them for the ideas we incorporated into it,” she said.

Republicans will likely focus on how much of the spending will go to ongoing expenses when deciding how much to support, but he demurred on offering an opinion on the full budget until his party met to discuss it, said Rep. Sawin Millett, R-Waterford, a member of the budget panel.

He added that lawmakers will be watching the spring revenue forecast to understand if winter revenue projections are expected to hold and to see if the economic recovery will continue beyond the influence of federal aid.

“Then we’ll really be able to draw some conclusions in terms of the proposed uses,” he said.