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Change package

The administration released a package of changes to his proposed budget submitted to the legislature in January. It can be found in two parts, one, appropriations and allocations and two, language.

The Administration will present the changes to AFA at 10:00 AM on Friday.

Notable items include:

  • Fund county jails and Indigent Legal Services through February 2018 while requiring the administration to bring proposals for changes to the Second Regular Session of the 128th There is no provision for supplemental FY17 funding.
  • Not in the change package but due to be discussed Friday is a proposal to treat the future of the Downeast Correctional Facility to a similar process proposed for jails and legal services
  • The elimination of the Civil Rights Teams through the Office of the Attorney General
  • $2M for a legal contingency fund for cases in which the AG declines to represent the governor. Incidentally the AG’s Office filed a motion to dismiss the governor’s lawsuit to compel the AG to pay his legal expenses. The AG authorized legal expenses for this lawsuit.
  • $5M for agricultural marketing
  • $300K to recreate the Landowner Relations position in IF&W
  • Several pieces of proposed education policy changes:
    • A voluntary framework for regionalization
    • The minority report of the EDU committee to add 1 charter school each year until the existing cap expires as in Mason’s bill LD 1158 which received a divided report from EDU
    • Allow high school choice “if there is room”
    • A pilot project for a scheme to take 90% of the state share attributable to students with special needs away from local districts so parents can create their own instructional plan as proposed in Gerrish’s bill LD 1132 which received a majority ONTP report in EDU
    • Provide additional training for staff providing education to students with autism as in Langley’s bill LD 1531
    • A proposal to extend Career Technical Education to middle-school students
    • A rehashed proposal to charge the cost of any necessary remedial courses required by students at institutions of higher learning to the school districts from which they received a diploma. This liability appears to encompass the lifetime of the individual.
    • The minority report on Pouliot’s bill LD 864 to establish a statewide teacher contract
    • Measures to address truancy and provide an assessment of state assessments
    • Add the costs of running the Department of Education (DOE) to the state cost of local education, lowering the state’s expected GPA contribution
    • Change bus refurbishment procedures to allow the addition of technology like Wi-Fi
    • Change reimbursement to higher education institutions for Early College to the average of the lowest cost credits available at the institution. The effect is that Community College credits would be 100% covered while University credits will not

The work remaining

The Appropriations committee has spent the last months caucusing on budget items, reviewing committee report backs, voting in or out unanimous or nearly unanimous items as well as addressing standalone bills mostly related to the Maine Public Employees Retirement System.

Several attempts have been made to engage Republicans both on the committee and in leadership in a meaningful dialogue regarding the 3% surtax and their proposals to fund education. Those discussions continue.

Speaker Gideon addresses this in the Press Herald today.

Maine House speaker: Republicans must do their part to fully fund schools

 

Budget

AFA Ds have presented committee amendments to incorporate the education and property tax relief aspects of the Opportunity Agenda. There was no meaningful discussion from Rs on the committee.

Following the May 1 revenue forecast the entire committee agrees on what revenue is available in the next biennium. $7.38B, including the 3% surtax approved by voters.

Outstanding items include:

  • Education funding, both General Purpose Aid (GPA) to education and support for higher education,
  • All Health and Human Services (HHS) cuts proposed by the governor,
  • The majority of the position eliminations proposed by the governor,
  • Controversial items in the Agriculture, Conservation and Forestry committee,
  • Funding for county jails,
  • The closure of Downeast Correctional Facility,
  • The fate and funding of the Maine Commission on Indigent Legal Services
  • Judicial salaries,
  • The creation and funding of a cabinet level Department of Information Technology,
  • The governor’s tax proposals,
  • General Assistance,
  • Support for legally present new Mainers that are prohibited by law from working,
  • Marijuana implementation, and
  • Debt service

Major items that have been resolved include:

  • Rejecting the governor’s plan to freeze retiree cost of living adjustments (COLA) for no reason
  • Rejecting the governor’s $40M raid on the General Fund to cover 100% of the costs of the State Police
  • Accepted setting the anticipated attrition rate for the upcoming biennium at 5%
  • Rejected the proposal to move the Driver Education and Evaluation Program (DEEP) to the Secretary of State’s office
  • Funding for teacher retirement $29M
  • Doubling the cap on slots for people with intellectual or developmental disabilities served under the Sec. 29 waiver for $11.6M

 

AFA Update: May 5, 2017 revenue forecast and unvoted initiatives

Monday’s revenue forecast sets the stage for budget negotiations. A relatively minor downward adjustment of $5.1M over this fiscal year and the next two still provides $7.4B in revenue.

Full Revenue forecast

Members received sheets containing all of the remaining unvoted items. These documents will guide negotiations and voting through the rest of the budget process.

ACF 128th Biennial Budget Unvoted Initiatives as of 04-30-17

AFA ONLY 128th Biennial Budget Unvoted Initiatives as of 04-30-17

CJPS 128th Biennial Budget Unvoted Initiatives as of 04-30-17

EDU 128th Biennial Budget Unvoted Initiatives as of 04-30-17

IFS 128th Biennial Budget Unvoted Initiatives as of 04-30-17

IFW 128th Biennial Budget Unvoted Initiatives as of 04-30-17

JUD 128th Biennial Budget Unvoted Initiatives as of 04-30-17

LCRED 128th Biennial Budget Unvoted Initiatives as of 04-30-17

MAR 128th Biennial Budget Unvoted Initiatives as of 04-30-1

SLG 128th Biennial Budget Unvoted Initiatives as of 04-30-17

TAX 128th Biennial Budget Unvoted Initiatives as of 04-30-17

TRA 128th Biennial Budget Unvoted Initiatives as of 04-30-17

VLA 128th Biennial Budget Unvoted Initiatives as of 04-30-17

ENR 128th Biennial Budget Unvoted Initiatives as of 04-30-17

EUT 128th Biennial Budget Unvoted Initiatives as of 04-30-17

Report Back HHS-Initiatives w/ HHS votes (Green)-Version #2

Report Back HHS-DHHS Mgmt w/ HHS votes (Yellow)

Report Back HHS-BEH to HUM w/ HHS votes (Gold)

Report Back HHS-Language w/ HHS votes (Purple)

AFA Update: Week of March 6-10- ENR, IFS, EUT, Tax, Retirement, Judiciary and ACF

Appropriations

Public hearings on the governor’s proposed budget wrapped up this week.

Environment and Natural Resources

Insurance and Financial Services

Energy, Utilities and Technology (US Broadband info)

Taxation

State Retirement– The most discussed and well attended hearing. The administration made it clear that the proposal to suspend cost of living adjustments (COLAs) for retirees is intended to make additional payments on the unfunded actuarial liability (UAL) that are currently unnecessary.

Judiciary

Agriculture, Conservation and Forestry

Members of the committee expressed great skepticism at the changes proposed by the governor’s budget in the Department of Agriculture, Conservation and Forestry. “Not going to fly” was one comment.

Next Week

AFA holds public hearings on a handful of bills related to the retirement system. At the end of the week Rep. Farrin’s bill to eliminate benefits for Legislators will be heard.

Taxation

In addition to its regular workload Tax started discussions about the governor’s proposed budget.

Maine Revenue Services (MRS) and the Office of Policy and Management (OPM) delivered an array of materials:

OFPR tax documents

OPM “impact” of question 2

OPM staff estimate that in the first year of the new policy-

  • Private sector employment will be negatively impacted by 2,400-4,300
  • Real disposable incomes will be negatively impacted by $400- $600 million
  • Maine’s population will decline by 800- 1,400
  • GDP will be negatively impacted by $40-$160 million

These estimates are based on an economic forecasting model. Models are only as good as the data provided to them. In this case every result is based on how many people OPM assumes will leave the state. They have not yet provided an explanation of the basis for those beliefs. Others presented research refuting “tax flight”.

MRS analysis of 3% surcharge– includes a distributional analysis

MRS provided answers to questions posed at the public hearing.

History of tax changes 2011-today

MRS Background materials for governor’s tax proposals– includes distributional analyses

MRS revenue estimates

MRS tax plan vs 3%

Next week

Tax is scheduled to report back to AFA on April 3. Next week is dedicated to work sessions on the proposed budget.

 

AFA Update: Week of Feb. 27- March 3- State and Local Government, Veterans and Legal Affairs, Labor ,IF&W, and Education

Appropriations

A recurring theme this week was the question of what is an appropriate initiative for budgets and what is a policy choice that is better suited to a standalone bill submitted to the policy committee. Outlining components that will go into determining General Purpose Aid to Local Education (GPA) by school district were also made available.

Monday

Appropriations was joined by the State and Local Government committee for public hearings on their portions of the governor’s proposed budget.

Items of note:

  • Moving analytical staff, including the State Economist, from the Office of Policy and Management to the Office of the Commissioner
  • Increased debt service for the Maine Governmental Facilities Authority (MGFA) to support renovations, particularly on the East (AMHI) campus and $6M to further work on the state-owned Dolby landfill in East Millinocket
  • Further MGFA debt authorization to support $100M in construction and maintenance at the University of Maine System (UMS)
  • $10M from unappropriated surplus for the Fund for Efficient Delivery of Local and Regional Services
  • Creation of the Department of Technology Services (DTS) (from the existing Office of Information Technology (OIT)
  • $21M in borrowing for IT infrastructure
  • Allow state facilities to accept contributions for upkeep, maintenance and repair

Tuesday

Joined in the afternoon by the Veterans and Legal Affairs Committee, AFA heard testimony on the following issues among others:

  • Changes proposed by the Ethics Commission to the distribution schedule of funds to the Maine Clean Elections (MCEA) program and a request for $1.7M in additional funding, the testimony also includes scenarios for different situations and a history of transfers to and from MCEA. Members of the public voiced strong opposition to the governor’s proposed funding levels for MCEA
  • The governor’s proposal to essentially deregulate games of chance for charitable organizations, relying instead on local enforcement
  • The governor’s proposal to implement Keno as a game of chance. Presenting the Bureau of Alcoholic Beverages and Lottery Operations (BABLO) Greg Mineo faced skepticism from the committee regarding the appropriateness of this initiative for a budget

Wednesday

The Labor, Commerce, Research and Economic Development (LCRED) committee spent the entire day with Appropriations.

Testimony was offered on the Workers Compensation Commission, the Department of Labor (DOL), Maine State Housing Authority (MSHA), Department of Economic and Community Development (DECD), Professional and Financial Regulation (PFR) and many other smaller agencies.

  • Support was expressed for the full appropriate amount of the Real Estate Transfer Tax (RETT) to the Housing Opportunities for Maine (HOME) fund in the MSHA
  • The Governor’s plan to eliminate the entire $180K appropriation for the Applied Technology Development Centers (ATDC). This successful program supports:
    • Maine Center for Entrepreneurial Development (MCED) – MCED runs an intensive 15-week training program, that has assisted 140+ small businesses. Removal of state funds would also affect MCED’s ability to draw down additional federal funds.
    • Maine Aquaculture Innovation Center (MAIC) – MAIC sponsors and facilitates innovative research and development projects involving food, pharmaceuticals, and other products from sustainable aquatic systems.
    • Target Technology Center at UMaine – Home of the UpStart Incubator, which provides coaching services and support to entrepreneurs in order to build competitive, market-oriented companies.
  • An increase from $25 to $100 per week in the amount an individual receiving unemployment compensation can retain of other earnings without jeopardizing their UI benefits

 

Thursday

In a brief public hearing a member of the Inland Fisheries & Wildlife committee shared Commissioner Woodcock’s testimony.

Opposition was voiced by committee members and the public to the elimination of Game Warden and science positions, the elimination of printed rule and law books, and the reduction of miles driven by Game Wardens. The Commissioner attempted to explain the reductions as necessary to maintain the same dollar funding as in the last biennium. No compelling reason was offered for this.

Friday

Rescheduled due to a storm EDU joined AFA for a hearing on the K-12 proposals offered by the governor. After two and half hours of testimony from the Acting Commissioner, scratching the surface of the more than 60 changes to the school funding formula proposed by the governor, the committees opted to take testimony from the more than 70 members of the public present to oppose the governor’s plans.

According to data from the Maine Department of Education, calculations show that almost 65% of Maine students live in districts that will see a decline in education funding from the state if the governor’s budget proposal is approved.

Concerns were raised about the looming March 30 deadline for school boards to propose budgets. The governor’s plan to eliminate state support for local school administration was panned. The budget as proposed will result in increased costs to towns of 5% and 10%.

Commissioner’s testimony

Part C breakout

GPA component spreadsheet

MEA Adjusted State Share by district

Supplemental budget

The Supplemental budget, LD 302 was finally enacted and sent to the governor on Thursday. The bill was replaced with the committee amendment.

Next Week

Monday morning public hearings continue with the Environment and Natural Resources committee.

 

Health and Human Services & final work on the supplemental budget

This week Health and Human Services and Appropriations committee held lengthy public hearings on the governor’s proposed biennial budget, LD 390 An Act Making Unified Appropriations and Allocations for the Expenditures of State Government, General Fund and Other Funds and Changing Certain Provisions of the Law Necessary to the Proper Operations of State Government for the Fiscal Years Ending June 30, 2018 and June 30, 2019.

Tuesday

Morning testimony focused on the non-DHHS departments and agencies under the oversight of the HHS committee.

  • Developmental Disabilities Council
  • Children’s Trust
  • Disability Rights Center
  • Maine Health Data Organization
  • Maine Hospice Council

There was no opposition to these portions of the budget.

The afternoon brought testimony regarding cuts to hospitals and to MaineCare eligibility.

Those items include:

  • Reduce Critical Access Hospital reimbursement from 109% to 101% of Medicare reimbursement- rejected 2011, 2013, 2015
  • Reduce reimbursement for hospital based physicians- rejected 2013, 2015
  • Eliminate health care for 18-19 year olds- rejected by Feds 2012, rejected by courts 2012, 2013, 2015
  • Eliminate health care for parents of children making as little as $6,020- rejected by Feds 2012, rejected by courts 2012, 2013, 2015

Public opposition was unanimous.

Wednesday

Convening at 10:00 AM both committees heard about the administration’s plans to eliminate General Assistance, prohibit support for legally present new Mainer’s, and institute draconian sanctions in the Temporary Assistance to Needy Families (TANF) program.

They also heard lengthy and unanimous opposition to these changes, many of which have been previously rejected by the legislature in one form or another.

  • Eliminate General Assistance- rejected in various forms since 2013
  • Change disability determination period- rejected 2013, 2015
  • Eliminate help for legally present new Mainers- rejected 2011, 2013, 2015

Testimony went into the evening.

Thursday

Prior to the scheduled public hearing Sen. Breen shared a proposed amendment to the supplemental budget.

Moving on to items related to the administration of the department Alec Porteous, Deputy Commissioner of Finance for the department presented testimony.

Alec shared information about the MaineCare Review process by which the department projects expenditures every six months using object level data. He indicated that this information could be shared with the committee.

Also scrutinized was language providing the department with broad authority to adopt emergency rules to implement programs and changes with very limited legislative oversight. This language was first used in 2009 to allow the department to quickly implement a particular initiative while the legislature was out of session. It has been asserted as “boilerplate” language ever since.

The afternoon focused on cuts to Maine’s public health infrastructure proposed by the governor.

Unanimous public testimony urged the rejection of these proposals.

Friday

Supplemental budget

A final work session was held on LD 302, the supplemental budget,. An Act To Make Supplemental Appropriations and Allocations for the Expenditures of State Government and To Change Certain Provisions of the Law Necessary to the Proper Operations of State Government for the Fiscal Year Ending June 30, 2017

The Appropriations committee:

Unanimously adopted Sen. Breen’s proposal to provide $4.8M in state funding for treatment of substance abuse, particularly opiates

Unanimously approved $155K necessary to hold the scheduled June 2017 referendum election.

On a 9-2 vote the committee removed the governor’s proposed $550K to promote diversity at the University of Maine School of Law. Members expressed concern about the appropriateness of addressing this in a supplemental budget.

Members spoke of their disappointment that agreement could not be reached to pay the state’s obligation to provide indigent legal services.

It was also expressed that the policy committee is the proper place to determine the path forward on support for county jails.

The supplemental budget was unanimously approved as amended.

Public hearings

Proceeding with the HHS committee the final day of Health and Human Services public hearings opened with testimony by Deputy Commissioner for Programs Ricker Hamilton.

  • Substance abuse and adult mental health
  • Services for the elderly and disabled
  • Developmental disabilities
  • Children’s mental health
  • Other Children’s services

The Secretary of State testified in opposition to the administration’s plan to transfer responsibility from the Driver Education and Evaluation Program (DEEP) from DHHS to his office.

Jim Martin, Director of the Office of Child and Family Services (OCFS) presented information related to his office including the elimination of state funding for Head Start. A proposal rejected in 2011, 2013,  and 2015.

Though not in the budget as initiatives, the department is poised to implement rate cuts to both Sec. 17 Community Support Services and Sec. 65 Behavioral Health Services. This faced opposition.

The budget does contain another attempt to use estate recovery to claim homes held in joint tenancy to repay MaineCare costs incurred by those older than 55 years of age. This has been rejected at least twice in 2009 and 2010.

Providers, consumers and the families of consumers gave their support for increases in Sec. 29 services.

Monday morning public hearings continue with the State and Local Government committee.

AFA Update- Week of February 13-17: Higher education, Transportation, Criminal Justice, indigent legal and Marine Resources

Appropriations continued public hearing on the governor’s proposed biennial budget.

Tuesday, joined by the Education committee, AFA heard testimony from the administration and supporters of the governor’s plans regarding the cultural agencies and higher education.

Wednesday morning the Transportation committee and AFA heard from the administration on the General Fund impacts of the governor’s proposed budget. Most significant is the proposal to shift 100% of State Police costs to the General Fund.

Criminal Justice and Public Safety participated in the afternoon as the Department of Public Safety (DPS) and Commissioner Fitzpatrick delivered the administration’s proposals regarding public safety and the Department of Corrections (DOC).

Discussion focused on:

  • Plan to reduce professional services(primarily inmate medical) costs by 10%
  • The return of a proposal to shutter Downeast Correctional Facility (DCF).

 

Members of the public roundly rejected the plan to close DCF.

Discussion of the 10% reduction in medical services revealed that this will be achieved by incarcerating 450-500 fewer people.

Thursday’s public hearing was dominated by opposition to the governor’s renewed plan to replace the current means of providing constitutionally required indigent legal services with a Public Defender’s Office. This proposal was rejected in the last legislature.

Public hearings wrapped up for the week with Marine Resources and testimony on the governor’s proposals for the Department of Marine Resources.

Concerns were expressed about the 30% increase in commercial fishing license fees, the elimination of 9 positions at the department and expenditures on the lobster marketing collaborative.

Appropriations and Health and Human Services committees will hold joint public hearings throughout next week’s break.