Maine Gov. Paul LePage vowed Friday to reject the legislature's latest bipartisan budget proposal, setting the stage for the state’s first government shutdown since 1991.
LePage told reporters he would not support any two-year budget plan that includes new taxes. The Maine legislature was slated to vote Friday afternoon on a $7.1 billion spending plan that includes increasing the hotel and motel lodging sales tax to 10.5% from 9%.
“There will not be a signature on anything that increases taxes,” said LePage in a press conference from his office. “This budget that they have has no prayer and if they are hell bent on bringing this budget down then we will shut down.”
LePage remains opposed to the budget deal brokered between Democrats and Republicans Thursday even though it repeals a voter-approved 3% tax surcharge on households earning more than $200,000. The budget would also boost education spending by $162 million.
The Maine legislature has split majorities with Republicans narrowly controlling the Senate and Democrats in narrow control of the House of Representatives. The fiscal proposal needs to garner two-thirds support for passage since it is considered an emergency budget that takes effect July 1.
Two-thirds support would also enable an override of a LePage veto. LePage said Friday however that he is willing to use the 10 days allowed under state law to respond to the budget, which would trigger a budget shutdown of non-essential government services starting with the Fourth of July weekend.
“In a divided government, compromise is the only option,” said Maine House Speaker Sara Gideon, D-Freeport, in a statement. “I urge my colleagues to support this proposal and urge the governor to take action immediately.”
Maine general obligation bonds are rated AA by S&P Global Ratings and Aa2 by Moody’s Investors Service. The state has a $26,657 non-GO debt payment owed on July 13, according to S&P.
