MSBA Legislative Update 05-1-09

LEGISLATORS RECEIVE DETAILS OF BUDGET GAP FIX

Gov. Baldacci unveiled his proposals to plug the $569 million budget gap. The Appropriations Committee received the details on Friday, May 1, through a briefing from Commissioner Ryan Low. The proposal closes a $129 million budget gap for the current fiscal year which ends June 30, and a $440 million gap for the fiscal years 2010-11. Some of the changes include: reduced funding for general purpose aid to education for FY 11 of $68 million; a pro-rated reduction for higher education for FY 10 and FY 11 of $3 million each year; a reduction in municipal revenue sharing of $6 million for FY 10 and $6 million for FY 11; suspending indexing of the individual income tax brackets which results in a $17 million reduction in FY 10 and $14 million in FY 11; changes to the net operating loss carry forwards and carry backs; and a number of other tax administrative changes for both individual and corporate taxpayers. Additional reductions in funding are proposed for health and human services, and for state employees, including a proposed 12 state shut down days for each fiscal year.

Budget materials are available from the Bureau of Budget, and a two-page overview of the changes proposed by the Administration are available at: http://maine.gov/budget/filesexcelbudgetinfo/fy1011excel/Budget%20Gap.xls.

Because the changes impact almost every area of state government, we strongly recommend that the Sections review the materials, for those items of specific concern to Section members.

The Appropriations Committee is expected to meet daily including the weekends, until it is able to finish its work on the biennial budget and make a proposal to the full Legislature. Legislative Leaders are hopeful that a proposed budget will be available for legislative debate the week of May 11.

UPCOMING ISSUES

• LD 1028 (municipal home rule) – Work Session 5/6/09 at 1:00 p.m., Room 216 of the Cross Office Building.
  
• LD 1268 (site location of development) – Work Session 5/8/09 at 9:00 a.m., Room 214 of the Cross Office Building.
  
• LD 1333 (climate and energy provisions in site law) – Work Session 5/5/09 at 1:00 p.m., Room 214 of the Cross Office Building.
  
• LD 1368 (increase sales tax) – Work Session 5/7/09 at 1:00 p.m., Room 127 of the State House.
  
• LD 1418 (preventing unnecessary foreclosure) – Work Session 5/4/09 at 10:00 a.m., Room 427 of the State House.