AUGUSTA, Maine — Democrats pushed a state budget addition including $300 relief checks and a millionaire tax through the narrowly divided Maine House of Representatives on Wednesday, putting it on track to pass later this week.
The $529 million proposal is the last state budget for the term-limited Gov. Janet Mills. She has kept a firm hold on business in the State House for most of her tenure, but it has slipped somewhat in recent weeks given her underdog status in the Democratic U.S. Senate primary led by political newcomer Graham Platner.
The budget debated Wednesday was another divisive fight between Democrats and Republicans. In the end, Mills effectively executed a trade for the relief checks that she prioritized in her State of the State address in January in exchange for the millionaire tax, a progressive demand that the governor opposed as recently as last year.
“We are continuing to deliver for Maine people,” Rep. Drew Gattine, D-Westbrook, the co-chair of the Legislature’s budget committee, said in a floor speech.
The House passed the budget in a narrow 76-73 vote on Wednesday. Only one Democrat, Rep. Tiffany Roberts of South Berwick, voted with Republicans against the measure. The majority party systematically voted down a ream of amendments that mostly came in from Republicans.
It faces further votes in both chambers, but the House was the major test of the package that is expected to clear the Maine Senate controlled 20-15 by Democrats.
This even-year budget bill is one of the most consequential spending adjustments in recent history. It includes $237 million in new spending in the fiscal year beginning in July and $293 million from the state’s surplus account to fund the relief checks and a host of other initiatives.
Passing it required a host of compromises from Mills, who has long resisted raising income taxes on high earners. The new millionaire tax would hit an estimated 2,400 filers with a 2% tax on annual income over $1 million, generating an estimated $150 million over two years. It led the Maine State Chamber of Commerce to come out against the budget this week.
Legislative Democrats also slimmed down the number of relief checks. Mills proposed them for 725,000 Mainers in her January address, but lawmakers slimmed the total down to roughly 514,000. The income cutoff is now $100,000 for joint filers and $50,000 for single filers, and they are framed as a tax refund in an attempt to avoid federal taxation.
Republicans were incensed when Mills used her January speech to propose raiding the state’s surplus fund for checks that she pitched as part of an “affordability agenda.” That speech was quickly carved into an ad for her campaign for the right to face five-term Sen. Susan Collins in one of the biggest races in the country this November.
Mills was the target of that remark. But Platner has proven to be a political force, drawing major crowds and outraising both Mills and Collins since late last year. He has won over several lawmakers, including those who joined Republicans in their skepticism of the relief checks but were won over by the income tax changes.
“I’ve learned in my eight years here that it’s not worth it to sacrifice what you know is true for political expedience or for the political ambition of someone else,” Rep. Amy Arata, R-New Gloucester, a budget committee member, said on the floor.
