Appropriations Committee Democrats Break Promises During Late-Night Spending Spree
In the famous movie “Gremlins” the tagline is “Don’t feed them after midnight.” This rule clearly also applies to the Democrats on the Appropriations and Financial Affairs (AFA) Committee. Late Friday evening and into the early morning hours on Saturday, the AFA Committee was working, but they weren’t working to improve state programs, help struggling families or reach bipartisan compromises that benefit Mainers. Instead, they worked to undermine previous political agreements and remove funding from crucial state infrastructure.
Last Friday was truly the night of broken promises, as AFA Democrats alienated Republicans on the committee and even the Mills administration. The most controversial action taken by AFA Democrats was the movement of around $11 million immediately from the Highway Fund into the General Fund, with $60 million each future year. The funding in question came from a 2023 bipartisan agreement to support the Highway Fund with a portion of vehicle sales tax revenue, a move championed by Maine Policy to close the state’s ongoing transportation funding shortfall without tax increases. But if the budget approved along party lines by AFA Democrats moves forward, that funding could now be no more. This change also includes removing the Highway Fund budget from the purview of the Legislature’s Transportation Committee and turning it over to the AFA Committee.
This, along with increases to the pension exemption, were two major deals made with Republicans during last year’s budget negotiations that were broken by AFA Democrats last weekend. Moreover, the committee moved Gov. Mills’ controversial Sears Island Wind Project permitting into the budget despite the project’s independent bill failing on the House floor with a vote of 65 to 80.
However, this was the only major project belonging to Gov. Mills the committee supported last weekend. Her plan to give nonprofits a sales tax exemption and offset that revenue loss by applying the state sales tax to digital streaming services failed. The committee unanimously voted for the nonprofit tax exemption but did not support the implementation of a streaming service tax.
Additionally, the Committee unanimously removed Part G, which contained Gov. Mills’ rollover slush fund. In a written statement, Gov. Mills expressed concern about the legislature moving highway funds into the general budget and refusing to sign onto her future-spending support fund. Ironically, Gov. Mills created this slush fund in the first place to avoid the budget surplus automatically entering a separate highway improvement fund through the normal revenue cascade. So, the governor who proposed creating a seemingly purposeless reserve fund to avoid funding highway improvements is now complaining that the Legislature is reducing funding for highways. Though, to her credit, all of the hijinks associated with raiding the Highway Fund in the dead of night is a particularly brazen political move by AFA Democrats.
It is not entirely clear what the AFA Committee intends to fund with the $107 million Mills wanted to save. Items they added unprompted to the budget after 2 a.m. on Saturday morning include $30 million for MaineCare stabilization, $18 million for eviction rental assistance, and $15 million for education funding stabilization. All of these measures were passed by committee Democrats along party-line votes, with Republicans objecting.
In light of their enormous cut to the state’s Highway Fund, it is important to remember that some of the funds left unspent before the end of the fiscal year would return to our highways. This means that if Gov. Mills line-item vetoes some of AFA Democrats’ budget, the revenue surplus created would likely return to the Highway and Capital Improvements Fund, in effect offsetting some of the damage AFA Democrats have done.
Given the strong pushback AFA Democrats have received from both Gov. Mills and Republicans in the Legislature, it’s likely they’ll have to go back to the drawing board at least one more time before the supplemental budget bill sees the light of day on the floors of the House and Senate. Additionally, It’s unlikely they’ll be able to allocate as much as they want for pet project spending from the Special Appropriations Table.
Lawmakers have roughly one week to sort this all out and dispense with the rest of their work before statutory adjournment.