Question 1 May Have Passed, But Lawmakers Still Need To Figure Out How To Fund It

Nov 6, 2015

AUGUSTA, Maine — Throughout the debate over Question 1, which was approved on Tuesday's statewide ballot, one major issue has been its funding mechanism.

Backers of the measure, which puts more money into Maine's public campaign financing system, would prefer that lawmakers find $6 million over two years by eliminating certain corporate tax breaks. But business interests are likely to resist that idea.

Gov. Paul LePage took an instantaneous dislike to Question 1, which provides an additional $1 million per year to the state's Clean Elections system. LePage characterizes the initiative as "welfare for politicians," but now that 55 percent of Maine voters have apparently approved it, LePage is ready to concede — sort of.

"The people have spoken, we're going to work on it and see what we can do," LePage says.

Mainers for Accountable Elections, the ballot question committee that's behind the changes, has recommended that the Legislature pay for them by eliminating $3 million a year in what they describe as low-performing or underused business tax incentives.

And they gave the Legislature another option, which is to continue to fund the program at the current level of $2 million a year, fold in an additional million from eliminating the tax breaks and use the remaining $4 million for whatever purposes they might choose.

But Maine business interests that campaigned against the question say that's a false choice because the approximately $80 million in tax breaks that could be in play are actually helping to fuel the state's economy. Whether it's the new markets capital investment credit or pine tree development zones, critics of the plan say the loss of a tax break could really do harm.

"So yeah, you could have a company that may be devastated by the fact that they lose an incentive that puts their business into the red," says state Economic and Community Development Commissioner George Gervais. He says the immediate effect of these changes may be hard to pinpoint.

"We won't know until the process follows through and we learn what programs are going to be targeted and I only hope that we are able to have some input in that process," Gervais says.

"Both the interpretation, but also the implementation of this initiative that was just passed, belongs with the Legislature, for our purposes that's where we'll be when the times comes," says Maine Chamber of Commerce President Dana Connors.

He says he has seen his share of citizen initiatives and he's preparing for a major lobbying effort when lawmakers return in an attempt to influence the funding of Question 1. In his efforts to preserve business tax incentives, Connors will argue that the Legislature should be able to find the additional $1 million a year elsewhere.

Legislative leaders are awaiting an analysis on the effectiveness of current tax incentives as they prepare to devise a funding mechanism for Question 1. Meanwhile, LePage and business leaders say they'll fight to retain those tax breaks, and Andrew Bossie of Maine Citizens for Clean Elections says his supporters will be pushing back just as hard.

"We will be working diligently to lobby lawmakers to stand up to the funding mechanism and to stand up for all of those important disclosure and accountability and strong clean election provisions," Bossie says.

But as it turns out, Maine's Clean Election Fund may currently have enough money in the bank to cover the expected increase in allocations for legislative candidates who choose to run publicly financed campaigns.

"We're still looking at the numbers but we think we may have sufficient funds that we will be able to pay for these enhancements under our current revenue or possibly only need to ask for a modest amount," says Jonathan Wayne, the executive director of the Maine Commission on Governmental Ethics and Election Practices.

The secretary of state has 20 days to issue a proclamation of elections results to the governor, who then has ten days to sign it and make it law.