AUGUSTA, Maine — Gov. Janet Mills released a $10.3 billion state budget proposal on Wednesday, calling it a “fiscally responsible” even though it looked likely to prompt a fight with Republicans over rising spending driven by inflation.
The two-year plan will be a centerpiece of legislative debate in 2023. It comes during a time of tension in Augusta. Mills already struggled to pass a $473 million heating aid plan, which Senate Republicans held up for weeks.
But Mills remains in the driver’s seat after winning a second term in the 2022 election. Democrats kept control of the Legislature and minority Republicans have been divided on spending so far. If the majority party detects obstinance, they could set aside the traditional consensus budget process and pass a budget alone by April.
Mills’ offer would hike the state budget above $10 billion for the first time. It contains few major initiatives, according to an outline released by her office. It keeps income taxes flat, continues funding K-12 education and municipal revenue sharing at statutory levels, contains $58 million to keep funding free school meals and continues a free community college program.
The document also attempts to address some of Maine’s most pressing issues, though advocates are likely to say it does not go far enough. It dedicates $30 million to rental housing during a wide affordability crisis, $15 million for foster care and adoption and $17 million more for the embattled legal services program for low-income Mainers, far below its funding request.
The governor’s budget would draw down $490 million in state and federal funds for behavioral health, expanding services for seniors and improving access to services for people with intellectual and developmental disabilities that have been subject to long-standing waitlists.
This budget offer would wipe out the smaller Section 29 waitlist and put $3 million toward emergency services in the Section 21 program, an outline of the budget says. There is another $42 million to bolster wages for providers that struggled to retain workers during the pandemic.
Mills’ tenure has been marked by a wave of federal COVID-19 aid that kept state budgets afloat during the COVID-19 pandemic. It led to runaway surpluses that enabled an $8.5 billion state budget in 2021, plus $1.2 billion more in a spending bill centered on relief checks last year. Another $280 million surplus fueled the heating aid measure passed this month.
Recession fears are high entering 2023, and other states are running into budget problems, including in California, where Gov. Gavin Newsom outlined cuts to bring the budget into balance. Mills noted revenue projections of $10.5 billion for the two-year cycle beginning in June, arguing that her proposal is fiscally responsible.
But legislative Republicans have long decried spending levels under Mills. After she took office in 2019, they were only able to cut a scant amount from her $8 billion proposal during negotiations. They were incensed when Democrats bypassed them in 2021 to pass an initial budget along party lines.
It could happen again with differing positions among Republicans on spending already. The House caucus engaged with Mills to win more relief checks in the heating aid deal, while Senate Republicans won nothing except their hearing before handing over the votes needed to pass it.
On Tuesday in the State House, Rep. Jack Ducharme, R-Madison, who sits on the budget panel, said his goal was to cut spending relative to the 2021 budget. But Senate Republicans have called for more money for nursing homes and services for people with disabilities. A conservative member, Rep. Laurel Libby of Auburn, doubted she would support any deal.
At the center of the action on the Republican side will be Rep. Sawin Millett of Waterford, another budget writer, declined to discuss the budget situation on Tuesday but indicated that he would keep pursuing a two-thirds deal.
“Always my goal,” he said.
BDN writer David Marino Jr. contributed to this report.
