Republican lawmakers said they won't support several tax and fee increases included in Gov. Janet Mills’ proposed budget.
Last week, Mills released a two-year, $11.6 billion budget proposal that she described as protecting “core commitments” — such as public education funding and support for municipal governments — while trimming spending in other areas. The proposal, which is now in lawmakers' hands, represents a $1.1 billion increase over the current two-year budget.
Mills proposed increasing taxes on tobacco — from $2 to $3 a pack on cigarettes, for instance — as well as recreational cannabis. Mills, a Democrat, has also revived an idea first proposed by former Republican Gov. Paul LePage of taxing video streaming services, like Netflix and Hulu. And her proposed budget includes a tax on non-municipal ambulance services and the roll back of a tax deduction for some pensioners.
Mills said the "targeted" revenue enhancements are necessary to plug an estimated $450 million shortfall over the next two years and to meet current commitments. The flow of tax revenues into state coffers is leveling while federal pandemic-related assistance is drying up.
But Republican leaders drew a proverbial line in the sand on Tuesday.
"Republicans are not going to be supporting any budget that is raising taxes on Maine people," said Senate Republican Leader Sen. Trey Stewart of Presque Isle. "It is not a taxation problem. This is a spending problem."
Speaking during a press conference at the State House, Assistant House Minority leader Katrina Smith of Palermo said many Maine households are turning down the heat, repairing rather than replacing and tightening their belts. And she says it's time for state government to do the same.
"They have to make do with the money that they have, they have to make do with the programs that they already have," Smith said. "In fact, they can certainly cut some of those programs. My constituents and the people behind me have had enough. We have no more money to give the state. We say no to new taxes and no to new positions."
Mills did not propose — and said she will not support — any increases to the income tax or other broad-based taxes. Even so, House Republican Leader Rep. Billy Bob Faulkingham of Winter Harbor said that poorer Maine residents would bear the brunt of her proposed increases. And he decried what he portrayed as "out-of-control, reckless spending."
Republicans have used the term "reckless" repeatedly in recent years in reference to budgets passed by the Legislature's Democratic majority. But during a press conference on Friday while unveiling her proposal, Mills said her proposal is both balanced and necessary to meet current needs.
"I don't think any hospital or nursing home in the state of Maine would call their additional reimbursements reckless," Mills said. "I don't think the school children and their parents and families would call school funding for universal school meals reckless. . . I don't think the towns and cities would call the increased monies going to revenue sharing reckless. I don't think any of this is reckless. It's balanced and it takes into account the fiscal responsibility of the state to do what's right."
This was Republicans' opening salvo in what will likely be a months-long debate over the state budget. Much of that discussion will play out in the Appropriations and Financial Affairs Committee, which will recommend a budget to the full Legislature. Some Democrats, meanwhile, are expected to oppose program cuts put forward by Mills.
