2 min read

Democrats and Republicans in the Legislature unveiled their positions Tuesday on the two-year state budget they have to approve together before July 1, and a proposed cigarette tax divides them.

The Democrats are calling for a 75-cent-a-pack hike and Republicans say they will support no new taxes. Both sides are expected to give some, but no one is willing to say yet how much.

The divide is worth just over $100 million. Republicans say they want to fill that hole with program cuts, including a redesign of the Medicaid program and a reduction in the health plan for state employees.

Democrats have their own hole to fill since Gov. John Baldacci’s original budget called for a $1 hike in the cigarette tax to raise $131 million over two years, and 75 cents only raises $104 million.

The Democratic proposal funds that gap with a 5 percent cut in the Business Equipment Tax Reimbursement program to raise just under $7 million; taking $5 million out of the affordable housing Home Fund; sweeping excess special revenue of $10 million; cutting funding for the Maine Technology Institute by $3 million; and, cutting the tourism promotion budget by $1 million.

More details were available from the Democrats because they opened their caucus on the budget to the press. Republicans ordered reporters out of their meeting and gave interviews afterward.

Advertisement

Both parties are booking more than $50 million in cuts in K-12 education funding, even though there is no consensus on a school consolidation plan that was supposed to generate the majority of that money.

The compromise work now begins in earnest, since party leaders have vowed to pass a budget that has the support of two-thirds of the Legislature – a promise they now have to keep. Time has run out for Democrats to pass a so-called majority budget, which wouldn’t take effect until 90 days after adjournment. The new budget has to go into effect by the start of the fiscal year on July 1.

“This is a good start,” said House Majority Leader Hannah Pingree. “We’re down to the really tough items.”

Some Democrats were concerned about putting all the emphasis on the cigarette tax when the alcohol tax hasn’t been touched in some time and the cigarette tax was just raised $1 a pack by the last Legislature.

“Some people don’t think it’s fair to go back to them,” said Rep. Timothy Driscoll, D-Westbrook, of the state’s smokers. Driscoll said that as an emergency room nurse, he sees first hand the ravaging effect of alcoholism and believes a tax hike there could serve as a deterrent.

Majority Leader Sen. Carol Weston said her party will not support any new taxes, and instead wants to look at the three big cost drivers – education, Medicaid and un-funded liabilities like health care for retired state employees.

“Those are the three areas that blow out our budget,” she said, and they have to be brought under control.

Comments are no longer available on this story