Democratic Gov. Janet Mills, who was elected to a second term on Tuesday, speaks to reporters, Wednesday, Nov. 9, 2022, in Portland, Maine. Credit: Robert F. Bukaty / AP

Maine is slated to see $280 million more in state revenue than previously expected, a state panel said in a Tuesday forecast that will determine the size of a heating aid bill being crafted by Gov. Janet Mills and key lawmakers.

It continues a good fiscal run for the Democratic governor, who has benefited from a raft of federal COVID-19 aid that helped states stave off trouble in the early pandemic. It allowed Mills and the Legislature to pass a $1.2 billion spending bill atop the regular budget that included $850 relief checks sent over the summer to most Mainers.

That response to high costs and inflation could be a model for a heating fuel relief program that Mills is expected to unveil soon. Her office has promised direct aid for low-income and middle-class families struggling with near-record prices for heating oil, but Mills and lawmakers were waiting for Tuesday’s forecast before digging in on specifics.

Most of the new revenue will come from increases in income taxes, with the state Revenue Forecasting Committee saying 14 percent more than last projected had come in through October. Also prominent was corporate taxes at 17 percent over, sales and use taxes at 2 percent and the estate tax at 167 percent over.

In a statement, Mills said she will release a plan this week to provide aid “particularly for middle-class and low-income Maine people” to help them remain safe in their homes over the winter.

“Looking forward, we will continue to budget in a responsible and prudent manner as we address Maine’s most pressing needs,” she said.

While he had not dived into the figures on Tuesday afternoon, Rep. Sawin Millett, R-Waterford, a key budget committee member, said the surplus would allow for a large, direct appropriation for lower and middle-income Mainers.

The increase “makes me very optimistic that we can, in a bipartisan manner, agree to a significant commitment to help people get through the energy costs they are now facing,” he said.

Maine’s rosy budget picture comes amid fears of a national recession, with one Bloomberg model calling one a certainty in the next year. The surplus is expected to be smaller than the revision that led Mills to increase her last relief check proposal from $500 to $850. Those checks went to single tax filers making less than $100,000 and families below $200,000.

The currently projected surplus is less than half of what that program cost, making it likely that the next relief round will be less sweeping than the last one. Policymakers could shrink the size by tightening up income limits, something Mills and others have teased so far.

Mills and others seem to be eyeing passage of a heating aid plan just after the Legislature convenes in January. Passing something quickly would require two-thirds approval in both chambers, meaning minority Republicans would need to sign off.