The Maine Legislature on March 9, 2016, passed a bill package that conforms Maine’s tax laws with recent changes to federal law, while providing $15 million in additional funding for local school districts.
The tax conformity bill, LD 1583, conforms fully with the federal tax extender bill approved by Congress in 2015, and funds extensions of tax relief for businesses, teachers and homeowners for two years. The Senate enacted the bill with a unanimous vote, following a 121-19 enactment vote in the House of Representatives.
The school funding bill, LD 1641, provides an additional $15 million of state aid to local schools, which are facing a shortfall in funding from the state. The Department of Education has recommended $20.9 million to keep local property tax rates from rising. The bill also creates a Blue Ribbon Commission to study school funding, to ensure the state is doing the best it can to provide for K-12 education. The Senate enacted LD 1641 with a unanimous vote, after a 131-8 vote in the House of Representatives.
Senate President Michael Thibodeau, R-Winterport, called the passage of LD 1583 a “huge win for Maine’s small businesses and for all tax filers.”
“As I said before, tax conformity is the seed corn of our economic future, because the seeds we plant now will greatly benefit us in the short and long term,” Thibodeau said. “By passing this bill, we are telling businesses that they are appreciated and welcome here in Maine, and that will benefit all of us. I was pleased that we were able to provide additional resources for education which will help our local communities mitigate property tax increases.”
The package culminates weeks of negotiations between Democratic and Republican leaders and Gov. Paul LePage.
“I knew that if we kept negotiating, we could arrive at ‘yes’ and ‘yes’ -- we could do the right thing for our job creators and for our schools. It never had to be one or the other,” said Senate Democratic Leader Justin Alfond of Portland. “This compromise gives Maine businesses every advantage to invest in more jobs, and provides critical money to school districts dealing with budget shortfalls.”
Having been enacted in both the House and Senate, the tax conformity/education funding package has been sent to the governor, who has publicly pledged to sign both when they cross his desk.