With a few tugs and pulls along the path, the Legislature bumped its way to final, "sine die" adjournment on the evening of June 20, 1997.

The Legislature reconvened for "Veto Day" as an opportunity to address Governor King’s rejection of three bills that were enacted before a temporary adjournment on the first of June.

The most controversial of the three vetoes was the cigarette tax proposal, which doubled the state’s cigarette tax from 37 cents to 74 cents per pack and used the $30 million in new revenues to: (1) expand the Medicaid health insurance program for children; (2) expand a prescription drug subsidy program for the elderly; and (3) create an anti-smoking program targeted to Maine’s youth.

Although the Governor agreed with the cigarette tax increase and some form of smoking education program, he adamantly opposed using the new tax revenues to fund new programs.

We should note that none of the Governor’s vetoes were overturned, the original cigarette tax bill was replaced and the others failed to gather the 2/3rds needed to overturn. (See "Pending Bills" on page 2 of this Legislative Bulletin).

In addition to dealing with the vetoed bills, the legislative docket included several new bills and reconsideration of several bond proposals that had failed to obtain the necessary level of support in the Senate two weeks ago.

The debate over the $13 million environmental bond revolved around two issues: (1) whether the entire $13 million environmental bond should be sent to the voters in November, or split between the November 1997 and June 1998 referenda votes; and (2) whether or not some of the uses for the bond proceeds were appropriate; i.e. using the bond money for "soft costs." In the end, both the Senate and the House voted to split the bond between the November and June referenda without making any other changes.

In November 1997, Maine citizens will be asked to vote on a $7 million environmental bond issue to:

• construct water pollution control facilities ($4.5 million);

• cleanup of tire stock piles ($2 million); and,

• address environmental health deficiencies in drinking water supplies ($500,000).

In June 1998, citizens will vote on an environmental bond issue of $6 million to be used for:

• the construction of water pollution control facilities ($1 million);

• grants to municipalities to close/clean up landfills ($4.5 million); and

• the mitigation of storm water pollution through the establishment of a comprehensive watershed program ($500,000).

Other bonds approved on Friday included a $10 million bond for state facility improvements and a $5 million dollar bond to fund capital expenses at the vocational high schools. The state facility improvements bond would create an Adaptive Equipment Loan Program ($1.5 million) and provide funds for facility improvements to the University of Maine ($6.5 million), as well as to the State House ($2 million).

The cigarette tax compromise between the Democratic majority and the Governor became possible with the discovery of $6.2 million in unanticipated inheritance and estate tax revenue, and by tacking on an additional $1.8 million, over the biennium, garnered from the state’s abandoned property and Medicaid reimbursement accounts. Suddenly, $8 million was available to fund a Children’s Health Reserve Account.

With this resolution, the doubling of the cigarette tax could go forward without the Governor’s veto, because none of the cigarette tax revenues would be used for a new program (except for $3.5 million a year which would be devoted to teach kids not to start smoking).

The balance of the cigarette tax revenues - approximately $15 million in the start-up year FY 98, and $27 million in FY 99 - will be dedicated to the Tobacco Tax Relief Fund. This new cigarette-tax-supported fund is dedicated to "address urgent tax relief needs of citizens of the State."

With an anticipated $30 million of new revenues, dedicated to tax relief, the question is what or who will be the target of relief. The "Taxpayers Relief Fund" created earlier in the session (see May 23rd Legislative Bulletin) "solely for the tax relief of Maine citizens" has been used to expand the "circuit breaker" program but has also funded new sales and income tax exemptions for the bio-tech and high-tech industries.

When the Legislature addresses this question next session, will the fact that Maine’s property tax still represents 43% of the income/sales/property tax mix raise the need for property tax relief to the level of "urgent"? Coincidentally, $30 million would provide a modest $5000 homestead exemption. In the absence of any meaningful tax reform, can Maine’s property taxpayers expect tax relief? We can only wait to see what the next session offers.

LD 1902, An Act to Amend the Filing Date Provision in the Maine Residents Property Tax Program, to Provide an Application Clause for Certain Provisions of Law Regarding Transfers of money from the Tax Relief Fund for Maine Residents to the General Fund and to Correct Certain Provisions in Recently Enacted Legislation, introduced the last day of the session as the so called "corrections" bill, offered a handful of technical changes to bills passed earlier in the session. The original portions of the bill elicited little debate and eventually passed to be enacted.

The bill appeared to gain importance to municipalities when Rep. George Kerr (Old Orchard Beach) offered the long awaited "Christmas tree" amendment. This end of session amendment is used to fund proposals that earlier "died on the table" in the Appropriations Committee for lack of funding, but are brought back to life in the last hours of the session if new sources of revenue become available. Legislators who saw their bills perish earlier in session had hoped to get their proposals hung on the tree for possible funding at the end of the session. In this case, the funds to pay for the ornaments on the tree were to come from the Tax Relief Fund, for a total of $4.2 million.

Included as one of the ornaments on the tree was the unfunded LD 549, a proposal to raise the daily reimbursement to towns for the cost of sending police officers to court. The amendment offered would have increased the $10 daily reimbursement to $30, costing the General Fund $421,960. MMA and the Maine Police Chiefs Association, along with many legislators, had worked on this issue throughout the session. Representatives Ken Lemont (Kittery) and Gary Wheeler (Eliot) especially worked hard to give this bill one last chance.

The "Christmas Tree" amendment offered to fund and endorse a wide collection of proposals, including a discount liquor store in Calais, clarifying the definition of non-profit fire and ambulance services, and funding an elderly abuse unit within the AG's Office.

The amendment eventually failed in the Senate after a series of see-saw votes in the House that gave the amendment a slim majority of only a few votes. The "Christmas tree" had something for everyone on it, but the size of it and the fact that the Tax Relief Fund would be used to pay for programs not offering any form of tax relief pushed some legislators into opposing it.

The following bills were pending final disposition when we reported on them in the "New Laws" section of the June, 1997 issue of the MAINE TOWNSMAN.

LD 147 - AN ACT to Extend the Jurisdiction of the Maine Labor Relations Board to Employees of Public Higher Education Institutions Who Have Been Employed Fewer Than 6 Months (Sponsored by Rep. Green of Monmouth); LD 1180 - AN ACT to Amend the Workers Compensation Law as It Pertains to Employer-selected Health Care Providers (Sponsored by Rep. Mitchell of Portland), and LD 1887- AN ACT Regarding Health and the Prevention of Smoking (Majority Report of the Joint Standing Committee on Health and Human Services), were enacted in the House and Senate but vetoed by the Governor. The vetoes were sustained on June 20, 1997.

The other two bills, LD 271 - AN ACT to Allow a Greater Share of the Transfer Tax to Remain in the Counties Where it is Collected (Sponsored by Sen. Goldthwait of Hancock) and LD 434 - AN ACT to Amend the Veterans’ Estate Tax Exemption (Sponsored by Rep. Layton of Cherryfield), died on adjournment.

Public law citations were left off the following bills which appeared under the "New Laws" listing in the June, 1997 MAINE TOWNSMAN because they were not available at the time of publishing.

Effective dates. Emergency legislation became effective on the date it was signed by the Governor.

Non-emergency legislation becomes effective 90 days after adjournment of the Legislative Session in which it was enacted. All of the bills listed below were enacted on or after March 28, 1997 (the technical end of the First Session); therefore; the effective date of non-emergency legislation is September 18, 1997.

LD 1106 – AN ACT to Increase Access to Education, Training and Employment for Displaced Homemakers (Sponsored by Sen. Pingree of Knox). P & SL 1997, c. 48.

LD 1437 – RESOLVE, to Study the State’s Regional Service Center Communities (Sponsored by Sen. Jenkins of Androscoggin). Resolves 1997, c. 78.

LD 1452 – AN ACT to Establish the Task Force to Study Equal Economic Opportunity for All Regions of the State (original bill sponsored by Rep. Joy of Crystal by request). P &SL 1997, c. 51.

LD 1589 – AN ACT to Amend the Composition of the Information Services Policy Board and Establish a Task Force on Information Technology in the Public Sector (Sponsored by Speaker Mitchell of Vassalboro). PL 1997, c. 554.

LD 64 – AN ACT to Provide Reimbursement to Counties for Persons Jailed on Probation Revocations (Sponsored by Rep. Wheeler of Bridgewater). PL 1997, c. 553.

Education and Cultural Affairs

LD 857 – RESOLVE, to Require the Department of Education to Review the Methods Used to Determine the Tuition Rates of a Receiving School for a Student from Another School District (Sponsored by Rep. McElroy of Unity). Emergency signed 6/12/97; Resolves 1997, c. 75.

LD 913 – AN ACT to Provide Additional Operating Funds for Homeless Shelters (Sponsored by Speaker Mitchell of Vassalboro). PL 1997, c. 552.

LD 1896 – AN ACT Regarding Temporary Assistance for Needy Families and Welfare Reform (Sponsored by Sen. Paradis of Aroostook for the Joint Standing Committee on Health and Human Services). Emergency signed 6/12/97; PL 1997, c. 530.

LD 1559 – AN ACT to Establish the Uniform Unclaimed Property Act (Sponsored by Rep. Taylor of Cumberland). PL 1997, c. 508.

LD 1835 – AN ACT to Implement Federal Welfare Reform Mandates for State Child Support Enforcement Laws (Sponsored by Rep. Nass of Acton). PL 1997, c. 537.

LD 967 – AN ACT to Clarify the Laws Relating to Backyard Burning (Sponsored by Rep. Volenik of Brooklin). PL 1997, c. 512.

LD 1217 – AN ACT to Protect the State’s Lakes, Rivers and Coastal Wetlands Through a Comprehensive Watershed Protection Program (Sponsored by Rep. Fuller of Manchester). PL 1997, c. 519.

LD 1455 – RESOLVE, Regarding Legislative Review of Chapter 500: Stormwater Management, a Major Substantive Rule of the Department of Environmental Protection, Bureau of Land and Water Quality (department bill). Resolves 1997, c. 67.

LD 1582 – AN ACT to Clarify and Amend the Storm Water Management Laws, the Erosion and Sedimentation Control Laws, and the Site Location of Development Laws (Sponsored by Rep. Rowe of Portland; cosponsored by Sen. Treat of Kennebec). PL 1997, c. 502.

LD 157 - AN ACT to Impose a Surcharge on Documents Recorded in a Registry of Deeds to Fund Preservation of Registry Documents (Sponsored by Sen. Daggett of Kennebec). PL 1997, c. 503.

LD 1408 – AN ACT to Redistrict Knox County and Provide for 5 County Commissioners (Sponsored by Rep. Savage of Union). PL 1997, c. 510.

LD 792 – AN ACT Concerning Technical Changes to the Tax Laws (Sponsored by Rep. Tripp of Topsham; additional cosponsors). Emergency signed 6/12/97; PL 1997, c. 504.

LD 1826 – AN ACT to Change the Name of the Bureau of Taxation and to Allow Other Agencies of the State to Benefit from its Services (Sponsored by Sen. Ruhlin of Penobscot) (Governor’s bill). PL 1997, c. 526.

LD 1897 – AN ACT Concerning Tax Relief (Sponsored by Rep. Tripp for the Joint Standing Committee on Taxation). Emergency signed 6/12/97; PL 1997, c. 557.

LD 626 – AN ACT to Provide for Department of Transportation Assistance in the Rehabilitation of Access Roads to Bridges of Historic Significance (Sponsored by Sen. Mills of Somerset). PL 1997, c. 547.

LD 1227 – AN ACT to Require the Department of Transportation to Improve the Conditions of Any Road that may be Turned Over to a Municipality (Sponsored by Sen. Harriman of Cumberland). Emergency signed 6/12/97; PL 1997, c. 539.

LD 1339 – AN ACT Relating to Municipal Excise Tax Reimbursement (Sponsored by Sen. O’Gara of Cumberland). Emergency signed 6/12/97; PL 1997, c. 505.

LD 1377 – RESOLVE, to Establish a Maine Mobility Fund Task Force (Sponsored by Sen. O’Gara of Cumberland; additional cosponsors). Emergency signed 6/12/97; Resolves 1997, c. 73.

LD 1586 – AN ACT Regarding Reimbursement for Sand and Salt Storage Facility Construction (Sponsored by Rep. Pieh of Bremen). PL 1997, c. 551.

LD 1842 – AN ACT to Authorize Department of Transportation Bond Issues in the Amount of $56,850,000 to Match Available Federal Funds for Improvements to Municipal and State Roads and State and Local Bridges (Sponsored by Rep. Kerr for the Joint Standing Committee on Appropriations and Financial Affairs). P & SL 1997, c. 56.

The following bills came out after the June issue of the MAINE TOWNSMAN went to press. Therefore, they were not included in the "New Laws" section of the TOWNSMAN.

LD 1902 - AN ACT to Amend the Filing Date Provision in the Maine Residents Property Tax Program, to Provide an Application Clause for Certain Provisions of Law Relating to Computer Software, to Clarify Provisions of Law Regarding Transfers of Money from the Tax Relief Fund for Maine Residents to the General Fund and to Correct Certain Provisions in Recently Enacted Legislation (Sponsored by Sen. Michaud of Penobscot) (Governor’s bill).

See article in this issue of the Bulletin.

LD 1905 - RESOLVE, Establishing a Blue Ribbon Commission to Study the Effects of Government Regulation and Health Insurance Costs on Small Businesses in Maine (Sponsored by Sen. MacKinnon of York).

This Resolve establishes a commission to study the effects of government regulation and health insurance costs on small businesses throughout the state.

LD 1904 - AN ACT to Discourage Smoking, Provide Tax Relief and Improve the Health of Maine’s Citizens (Sponsored by Speaker Mitchell of Vassalboro). Enacted 6/20/97; PL 1997, c. 560.

See article in this issue of the Bulletin.

LD 1899 - AN ACT Regarding the Restructuring of Contracts Between Public Utilities and Qualifying Facilities (Sponsored by Sen. Carey of Kennebec). PL 1997, c. 558.

This Act adds an exception to the requirement that each investor-owned electric utility divest all generation assets and generation-related business activities on or before March 1, 2000, for a contract with a party other than a qualifying facility or affiliated interest entered into solely for the purpose of restructuring a contract with a qualifying facility.

The Maine Municipal Association thanks legislators and municipal officials who worked with our staff on the hundreds of bills we tracked during the session. We especially want to thank those legislators who supported legislation beneficial to Maine’s cities and towns. We also want to thank those municipal officials who served on the Legislative Policy Committee and the numerous municipal officials who contacted their legislators to offer their opinion and input on the issues before the legislature.

Our efforts at the State House are effective because our members are involved and active. Our thanks go to all of you who worked to strengthen local government in Maine.