Mike Allen, the governor’s tax policy adviser, testifies before the Appropriations and Financial Affairs Committee alongside budget chief Richard Rosen.
Good morning and, for some of you, happy shoveling.
Thursday marks the third consecutive day of public hearings on the governor’s budget and related tax overhaul before the Legislature’s budget and taxation committees. The hearings have been linked to specific portions of the budget and the tax plan in particular.
Tuesday’s hearing was devoted to the sales tax and income tax portion of the budget, although there will be additional hearings on the elimination of sales tax exemptions next week. Wednesday’s hearing brought out a slew of town officials protesting the governor’s plan to eliminate municipal revenue sharing.
Thursday’s hearing will focus on a variety of elements, including the eventual phase-out of a business equipment tax reimbursement program that is popular with large employers. Gov. Paul LePage proposed a similar initiative in his 2013 budget. The business community did not like it. Not at all. The governor said during his Jan. 9 budget briefing that he believed businesses will be more receptive to this proposal. We’ll find out soon.
Also on Thursday, lawmakers will hear public testimony on the governor’s plan to remove property tax exemptions for certain nonprofit organizations. There is little doubt that this provision will generate opposition from hospitals, private colleges, summer camps and on and on. LePage has contended that his income tax cut will lead to a flood of charitable giving, thereby helping nonprofits replace the money paid in property taxes. However, that claim is disputed.
There are no scheduled committee meetings or hearings on Friday.
Pivot
It’s been noted many times that the governor’s tax plan has put Republicans in a tough spot because they’ve been asked to support a tax change concept similar to one from 2009 that they successfully fought to repeal a year later.
But there have been pivots and reversals within the LePage administration, too.
Take Jonathan LaBonte, the mayor of Auburn and the governor’s director of the Office of Policy and Management. In 2013, LaBonte and a coalition of mayors held a press conference at the State House to oppose the governor’s plan to eliminate revenue sharing. The coalition even supplied a list of alternatives to the cut, including … wait for it … suspending the 2011 income tax cuts. To be fair, LaBonte has long been advocate of consolidation of municipal services, including plans between his home city of Auburn and neighboring Lewiston, so it’s not like he’s doing a complete flip-flop here. However, his opposition to the revenue sharing cut in 2013 and his advocacy for it now, has left him vulnerable to criticism.
Interestingly, the mayors coalition also expressed support for L.D. 1496, the so-called Gang of 11 tax reform plan drafted by former independent state Sen. Dick Woodbury, of Yarmouth. Like the governor’s proposal, Woodbury’s plan reduced the income tax and paid for it with increases in sales, meals and lodging taxes. Woodbury’s plan also expanded the list of services subject to the sales tax. While reducing the income tax was one of the goals of Woodbury’s plan, so was reducing property taxes. Woodbury’s plan did not eliminate revenue sharing.
Reversal
As noted here on Tuesday, Woodbury has written that the governor’s plan is the best hope for tax reform. David Sorensen, the former communications director for the Maine Republican Party now working at the Department of Health and Human services, took notice and promoted Woodbury’s Press Herald op-ed on Twitter.
Now flashback to 2012. Woodbury was hammered with a barrage of attack ads by Republican PACs attempting to link him to the 2009 reform bill, claiming that he voted to raise taxes on services (Woodbury supported the bill, but wasn’t in the Legislature to vote for it.). The Maine Republican Party sent mailers claiming that their candidate, Chris Tyll, fought to repeal the reform law.
Constitutional carry
There have been a number of attempts over the past several years to do away with the law that requires resident to obtain a permit to carry a concealed weapon. There’s another one in the works.
The libertarian group Campaign for Liberty has been soliciting support for L.R. 280, a draft proposal to eliminate the permit requirement. An email from the campaign urges supporters to contact their local legislators and urge them to sign on as co-sponsors. The deadline to do so is Feb. 26.
Brent Tweed is the state coordinator for the Campaign for Liberty. If his name sounds familiar, it’s probably because Tweed helped lead the takeover of the 2012 Republican State Convention during which supporters of presidential hopeful Ron Paul secured the majority of delegates over supporters of Mitt Romney.
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