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Why Gov. Mills’ Skepticism Of Maine Utility Takeover Could Show Limits Of Anti-CMP Politics

Robert Bukaty / AP

In this week’s newsletter: The politics of the public power proposal; Maine Chamber steps away from anti-public power group; Gov. Janet Mills frets property tax increases.

As Maine lawmakers fast-track a bill that would replace Central Maine Power and Versant Power with a so-called public utility, Gov. Janet Mills is stepping up her calls to the legislature to look more closely at the proposal before attempting to send it to voters in November.

In a wide-ranging interview on Maine Public's Maine Calling program, Mills expressed a range of concerns about a 13-page bill that would effectively force the state’s two electricity providers to sell their assets and be replaced by a consumer-owned non-profit controlled by an elected board. Mills, a Democrat, didn’t say definitively that she would veto the proposal, but she made several comments that suggest that she views it as not ready for primetime, much less ready for Maine voters.

At one point Mills paraphrased American journalist and culture critic H.L. Mencken.

“There's a single solution to every problem: simple, quick and wrong,” she said. “I'm concerned that this might be the wrong answer to some complicated issues.”

The governor’s increased skepticism appears rooted in key provisions of the bill, including the qualifications of the elected board that would control the new utility.

“There's no requirement that they have expertise in utilities or finances, or energy, or accounting or economics,” she said, adding, “and this board will farm out the operation of the utilities to a private for-profit entity that will, I think, look a lot like CMP, look a lot like Versant.”

Mills also expressed concern that municipalities currently hosting CMP and Versant infrastructure would lose property tax revenue because the new utility would be a non-profit and tax exempt.

Some of the governor’s concerns mirror objections made by Versant and CMP, although she didn’t absolve the two utilities of creating the public relations debacle that has made them targets for lawmakers’ government intervention. CMP in particular has made itself vulnerable with overbilling controversies, increased rates and some of the worst reliability and customer satisfaction ratings in the country.

CMP’s reputation, and the groundswell of opposition that it’s inspired, has already colored the debate over the utility’s controversial transmission corridor through western Maine to satisfy its contract with Massachusetts.

Drafters of the public power proposal are attempting to harness the same disillusionment, but they may end up discovering the limits of its political usefulness.

On its face, Mills’ increasingly public misgivings about the utility takeover bill -- governance structure, expertise, etc. -- might seem like technocratic hand wringing. However, her framing that the bill offers an overly “simple” solution to a “complicated” problem could well tap the same disruption anxiety electricity customers around here feel whenever the wind blows. Add in the proposal’s nebulous impact on electricity rates and reliability -- as well as the “government takeover” rhetoric already deployed by CMP’s well-financed messaging campaign -- and the public could sour on the idea of entrusting a new, unknown entity with keeping the lights on.

Our Power, the nonprofit organization pushing the proposal, insists that it already has public opinion on its side. This week it released an online poll claiming to show overwhelming support for the bill -- although the survey question arguably steered respondents in a predetermined direction by framing the new utility as owned by “Maine people” while also noting that CMP and Versant are “foreign-owned.”

Both sides will have ample chance to test the effectiveness of their rhetoric if the takeover bill clears the legislature before the end of the session. However, Mills’ comments this week suggest that public power advocates have a lot of work to do. The governor’s skepticism may well affect the public’s receptiveness to the bill, but for now her position has the practical effect of making its passage more difficult; if she vetoes the bill it will require a two-thirds vote in the House and Senate to override her.

Not only is it unclear if there’s that much support in the Legislature for the bill, it’s also unclear if Democrats will want to defy Mills on such a high-profile issue the year before she’s up for reelection.

Chamber abandons anti-public power group

In mid-May Maine Public reported that the Maine State Chamber of Commerce had created a new group, the Maine Affordable Energy Coalition, or MAEC, to oppose the public power bill.

This week the chamber confirmed that it was backing away from that project.

In a written response to an inquiry from Maine Public, Maine Chamber president Dana Connors said his organization “continues to oppose a government takeover of Maine’s electric power grid,” but that it didn’t have the “bandwidth” to lead the MAEC.

The MAEC is led by Willy Ritch, a former staffer for Democratic Congresswoman Chellie Pingree. More recently Ritch led Maine Momentum and 16 Counties, a dark money group that spent most of 2019 hammering Republican U.S. Sen. Susan Collins by staging town halls and running ads slamming her voting record.

Collins made no secret of her displeasure with the group’s tactics. When Ritch’s involvement with MAEC was made public in May, several of her former campaign staffers publicly questioned the chamber’s decision to hire him.

Connors wasn’t available for an interview this week, so it’s unclear if the chamber’s decision to abandon the MAEC effort involved more than the chamber’s organizing capacity.

Either way, the chamber’s withdrawal hasn’t stopped MAEC from pushing against the public power project. But its decision means that the MAEC’s financial supporters will no longer be able to funnel secret donations through the chamber to the group if the proposal makes it to referendum. For now, MAEC’s funding will be considered indirect lobbying -- also known as grassroots lobbying -- against the public power bill.

Mills “very concerned” with property taxes

The governor this week expressed some ambivalence over Maine’s booming real estate market in comments that may inform deliberations over her budget proposal.

During her Maine Calling interview, Mills said she was thrilled that people from out of state were moving to Maine. However, she noted that the sudden interest in Maine real estate and a corresponding explosion in property values could be a problem for existing property taxpayers.

“This is good for the economy, good for the health of our families,” she said. “But, at the same time, it's driving up prices in some areas where folks who have been living there for a long time are going to be stuck with a higher tax bill. There are revaluations going on right now.”

Fear of rising property taxes has been a perennial issue, but increasingly so now. It’s likely to become a key debate as lawmakers finalize adjustments to the state’s next two-year budget.

Mills has proposed increasing local education aid and municipal revenue sharing, two slugs of state funding that, in theory, should at least hold the line on property taxes as municipal budget writers draft local spending plans. But the state funding doesn’t guarantee tax relief, which is one reason why Mills increased the benefit and eligibility of the state’s property tax fairness program that provides direct relief to homeowners.

Republican and Democratic lawmakers are expected to push for more -- and they just might get it.

One option might be to increase funding in Mills’ proposal within the property tax fairness program. Another might be to increase the homestead exemption, which provides relief based on a property’s value.

The governor appeared to throw water on the latter approach because the soaring valuations of properties could diminish the impact of the fixed homestead exemption benefit.

Legislature goes full-tilt

The legislature is scheduled to meet through June 16 and next week will be its most hectic stretch yet.

The House and Senate are expected to hold sessions and floor votes Monday through Friday.

Click here to subscribe to Maine's Political Pulse Newsletter, sent to your inbox on Friday mornings.

Journalist Steve Mistler is Maine Public’s chief politics and government correspondent. He is based at the State House.