Tax bill debate heated at times
By SUSAN M. COVER
Staff Writer
Kennebec Journal & Morning Sentinel Friday, June 22, 2007

Staff photo by Andy Molloy
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Staff photo by Andy Molloy
Rep. Richard Cebra (R-Naples), center, catches a yawn while meeting with fellow Republicans in a House caucus Thursday morning before the reconvening of the Legislature at 9 a.m. Members of the House and Senate departed around 1 a.m. Thursday. At left is Rep. Peter Edgecomb (R-Caribou) and at right is Rep. Windol Weaver (R-York).
AUGUSTA -- Gov. John Baldacci told lawmakers late Thursday that he will develop a plan for tax reform for them to consider next year. In closing remarks to the Legislature, just minutes before they adjourn for the year, Baldacci both praised lawmakers and told them there's more work to do.

"This has been one of the most productive legislative sessions in recent history," he said while standing in the House of Representatives.

He listed off accomplishments -- passing a bill to require major changes to the state's school districts, a major borrowing package, a measure to reduce greenhouse gases and a bill to crack down on predatory lenders.

When lawmakers finished their work for the night, House Speaker Glenn Cummings, D-Portland, appointed members of the Taxation Committee to be the official party to ask the governor for his comments.

While greeting them in his office, Baldacci told them to take some time to relax.

"As you embark on it, I hope you enjoy your summer," he said.

During his speech, he thanked the committee for its work, and said he will develop a plan that changes the tax code and reduces spending.

"We will do more to take our case to the people," he said.

Baldacci said there's also more work to do on health care, and that it's his goal to make "Maine the healthiest state in the nation."

He then walked down the hall to the Senate, where he delivered a slightly modified version of the speech. The House adjourned at 10:24 p.m., while the Senate adjourned ten minutes later.

Tax reform dominated debate at the Statehouse in recent days. Here's an excerpt from the tax reform debate which is part of what can be found online at kjonline.com.

Noon: The Senate is debating a motion to kill the major tax reform bill. If they vote in favor of the motion to indefinitely postpone, it will head to the House. A frustrated Taxation Committee Chairman Sen. Joe Perry, D-Bangor, explains that he and others tried to find a way to expand the sales tax base to make it more stable, to extend it to items that are discretionary and to get tourists to pay more of their fair share. The proposal seeks to lower the income tax, while expanding the sales tax to more items.

In the end, Perry said on the Senate floor, last minute questions and a "campaign that has scared the public" killed it.

"We can keep moving it further along, at some point, we have to decide if we're going to do it or not," he said.

Sen. Ethan Strimling, D-Portland, said he hopes Gov. John Baldacci calls back lawmakers for a special session to work once again on tax reform.

Strimling worked with Sen. Richard Nass, R-Acton, to help lay the early groundwork for the proposal.

1 p.m.: The Senate tax reform debate rages on. The pending motion is to kill the bill, which proposes to lower income taxes and expand sales taxes. Judging by the debate, the motion will pass.

Some of those who spoke said lawmakers are out of touch with the people they serve.

"This is my ninth year as a legislator and I've never spent the night in Augusta," said Senate Minority Leader Carol Weston, R-Montville. "The longer you stay in the building, the crazier you get."

Weston said lawmakers failed to get citizens involved.

An angry Taxation Committee member Sen. Ethan Strimling, D-Portland, responds to Weston by saying he too has never spent the night in Augusta.

He said he keeps in touch with the people he serves, and took exception to comments that the tax plan won't save people money.

"Maine people will not get a reduction in taxes today when this plan fails," he said. "That is simply the truth."

Assistant Senate Majority Leader John Martin, D-Eagle Lake, said the Senate action means there will be no tax reform this year or next.

Lawmakers have to face voters again in November 2008.

"If anyone in this body thinks any Legislature can pass a tax package in an election year, you haven't been in the Legislature as long as I have been," he said.

Martin said lawmakers must come back in a couple of months to try to work it out, before campaigns begin.

After the Senate vote, the bill heads to the House. Will they try to revive it?

2 p.m. Now that the Senate has voted 26-9 to kill the tax reform bill, the House is considering an amendment in hopes of keeping it alive. Rep. Thomas Watson, D-Bath, is offering an amendment that he believes addresses nearly all of the objections raised in the Senate.

The bill seeks to lower the income tax and expand the sales tax. His amendment exempts some of the most controversial services that would have been taxed -- snowplowing, plumbing, haircuts and a long list of other services.

Watson's amendment also makes changes to the real estate transfer tax proposal and would lower the income tax to 6.5 percent.

"Nothing comes easy and important and historic things, if you will, come the hardest of all," he said. Taxation Committee Chairman Rep. John Piotti, D-Unity, tries to convince fellow House members to look beyond lobbyists.

"What's happened the last few weeks is all about politics," he said. "We have all been manipulated. Special interests, with one narrow interest, tells you you have to fight this."

He makes a prediction: "If you care about tax reform, this is our last chance. No one in these halls is going to take up this charge again and put in what this committee has put in knowing failure is the result."

3 p.m. The tax reform ball is back in the Senate's court. A House vote of 80-59 to pass an amended version of tax reform sends the bill back to the Senate for consideration.

Here's a quick recap: Last week, the House passed a tax reform bill that lowers the income tax and expands the sales tax. Earlier today, the Senate voted to kill it.

The House just voted to support an amended version that takes out some of the more controversial items that would have been subject to the sales tax, such as haircuts and snowplowing.

That means the amended version of the bill now goes back to the Senate.

During House debate, Rep. Meredith Strang Burgess, R-Cumberland, said she needs more time to consider such a big change in tax policy.

"This amendment hit my desk at 1:30," she said. "To me, this is about process, it's just we've run out of time."

Taxation Committee member Rep. Kathleen Chase, R-Wells, encourages representatives to support the amendment, although she knows not everyone agrees. "We all are going down the same road, we're just in different cars," she said.

4 p.m. There's a lot of paper moving back and forth. And it isn't all tax reform related.

As they push toward the end, the House and Senate are taking votes on dozens of bills.

They've given final approval to a bill that directs the Attorney General to write rules to outlaw the sale of flavored cigarettes and cigars. Sorry, no more grape cigars for you. They held over until next year several bills, including one that seeks to allow slot machines on Indian Island and one to create the position of public access ombudsman.

Mostly, though, House Democrats are trying to convince their Senate colleagues to support the amended version of tax reform. The Senate bell is ringing.

5 p.m. Tax reform died sometime around 4:20 p.m.

Despite efforts by House Democrats -- and some Senate Republicans -- the Senate voted to stick with its original position, which is to kill the bill. Officially, since the House and Senate don't agree, the bill is dead for this legislative session.

During debate, Sen. Peter Mills, R-Cornville, gives a passionate speech urging Senators to support the House amendment, which calls for a more modest expansion of the sales tax with a reduction in the income tax.

"Every pundit, egghead, geek, commentator, economic development expert who opines on the tax code has said we ought to do two things that are so obvious it's like egg on your face," he said. "Expand the base of the sales tax and cut the income tax."

He said lawmakers can't be concerned with pleasing everyone. "I don't think this is easy politics," he said. "This is taking your medicine time."

Others -- Sen. Richard Nass, R-Acton, among them -- said something is missing.

What about reducing spending?

Susan Cover -- 623-1056

scover@centralmaine.com

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previous page | next page1-10 of 15 comments:

Steve CS of Augusta, ME
Jun 22, 2007 5:29 PM
Speaking of blah blah blah. Stop complaining. Jump in and fix it. Come up with a specific list of things to cut,convince the voters to send you to Augusta and convince your fellow legislators to vote for your cuts and see what happens. The one specific cut listed - cutting DHHS would seriously save the taxpayers a load of money. . or the couple billion sent back to your town for schools and roads. Then in the next session you can deal with the consequences of people and services you cut loose. Put your time where your mouth is . . . jump in and fix this.report abuse
Tim of Weld, ME
Jun 22, 2007 3:46 PM

Only a politician would list going further into debt as a positive accomplishment.....along with the global warming bill that will raise our electric rates and accomplish little else....and lending regulations that, at best, will make it harder for people with borderline credit to buy a home.

Well done Augusta....at least I'll now know maple syrup when I see it.report abuse
Nelson Donnell of West Gardiner, ME
Jun 22, 2007 2:30 PM
"He (Baldacci) listed off accomplishments -- a major borrowing package, blah, blah, blah and a bill to crack down on predatory lenders."

When is State government going to crack down on its being a predatory borrower? State government is constantly borrowing monetized debt (money) based on the State's ability to coerce every man, woman and child into participating and contributing (by the use of force and arms if necessary) to governments "tax schemes", a regular rob Peter to pay Paul piece of work in progress.

These government promises of tax relief sounds like the promises of a married person saying that they are going to stop cheating on their spouse, but in reality they are just too weak and addicted to cheating to break free from their bad habits and their promises just aren't worth listening to. You can't change a cheater and you can't get todays government to stop their tax and spending habits.report abuse
Tom Davis of winslow, ME
Jun 22, 2007 1:03 PM
his plan should for next year is shut down DHHS he can resign and cut the legislature in half.report abuse
MadDog of Providence, RI
Jun 22, 2007 11:11 AM
Maybe the Governor can dust off his copy of the report issued by the special Commission he chaired back in the 1990s. Lots of good ideas (broaden the sales tax base; lower income tax rates; etc.) in that one because the commission had many people with varied backgrounds involved. I think he decided then that the timing wasn't right, so he would develop a plan for consideration by the Legislature next year! Some things never change, even when it becomes critical that they do. report abuse
Pat of Winthrop, ME
Jun 22, 2007 10:11 AM
And flavored cigars & cigarettes, don't forgetreport abuse
RichardW of Gardiner, ME
Jun 22, 2007 10:02 AM
Uhhh let me see if I got this right. The legislature incresed spending this biennium $600 million dollars (8%) or twice inflation and was patting itself on the back for a $140 million dollar tax reduction/shift "reform" package. Duhh I don't get it. Maybe next time you could increase spending 1 Billion dollars and give us a $300 million dollar break!!! Yeah!! Morons! report abuse
MattB of Augusta, ME
Jun 22, 2007 9:41 AM
Next year. Next year. Baldacci keeps saying "next year". He's said it before, (when we were facing a vote on the Pelesky plan), and he said it again, (when we were facing a vote on TABOR), but it still hasn't happened. I'm glad the current plan went down the tubes because it wasn't tax reform. It didn't reduce our rediculously oversized budget. It needs to start there. Time to revive TABOR!report abuse
Marilyn Burgess of Leeds, ME
Jun 22, 2007 9:17 AM
I have always been willing to pay taxes that contribute to the health and strength of our state, as least as long as I can eat, be clothed and stay warm. If this is truly an attempt to get a good bill as opposed to a poorly constructed bill, I can wait. But if it is just an opportunity to avoid doing something constructive, the legislators are in for a rude awakening. Making out a state of Maine tax form that differs so much from the federal is an exercise in frustration. I will be reminded of legislators every time I do it until they come up with a better plan. I am not sure if the lack of experience in legislators who turn over frequently is a problem or not. I was once told it takes one term to find the bathroom and figure out how to avoid lobbyists.report abuse
Active Voter of Out of Control, ME
Jun 22, 2007 8:59 AM
Shift and Shaft tax policy is not going to work. The only true tax reform is to reduce spending which to this day has not been possible with the current occupants of the Blaine house. It is time for a drastic change starting with new leaders that have a clear vision of the future, that can manage and control spending.

It is not just the dem's that are to blame this time. I am very dissappointed with our local rep's because they caved on so many issues.
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