And the latest cuts come after years of state human-services reductions during Baldacci’s tenure and the Democrats’ control of the Legislature. The National Alliance for the Mentally Ill–Maine calculates that state mental-health programs, including the loss of matching federal dollars, were cut by $33 million in just the 2007 fiscal year.
Yet the Legislature this session ardently expressed its desire to give away more money to the very rich and to businesses. The House, with Democrats in a 90-59 majority over the Republicans (with two Independents), voted 83 to 57 (with 11 absences) to reduce the state estate tax — the tax paid by estates after (literally, only) millionaires die — to conform to the Bush-administration-promoted lower federal estate tax. The Senate, controlled 18 to 17 by the Democrats, voted 31 to 3 for this quintessentially Republican “tax reform” (Republicans call it the “death tax”). Only Portland-area Democratic Senators Ethan Strimling, Joseph Brannigan, and Beth Edmonds, the Senate president, voted against it (Senator Lynn Bromley, a Democrat of South Portland, was absent).
State House analysts calculated this reduction would cost the treasury a total of $55 million in the next three years, so despite the enthusiasm for the bill expressed in both houses the Appropriations Committee killed it in the last days of the session. The Legislature probably would have had to increase another tax to pay for it.
“Everyone would like to get to the point where these things could be done,” says Democratic Senator Margaret Rotundo of Auburn, the Appropriations chairwoman, on the subject of reducing the estate tax. “It would be something that would be nice to do.”
She is concerned that because of the state estate tax Maine is losing “very large numbers” of philanthropically inclined rich people — though she had no statistics to back up the claim.
Senate Majority Leader Libby Mitchell agrees, “It’s a nice idea, but we can’t afford that.”
By contrast, Senator Strimling, who is running for Congress in the 1st District Democratic primary, spoke forcefully on the Senate floor against the estate-tax reduction: “We just passed a budget a week ago in which we cut $200 million from many of the neediest, the poorest, the disabled, and the working families of this state. It would be completely fiscally and morally irresponsible to now give a tax break to those with over a million dollars.”
Strimling, Brannigan, Edmonds, and another Democratic senator, Bruce Bryant of Dixfield, also lost initially when the Senate passed, 29 to 4 (with 2 absent), a bill extending the state’s exemption on new business equipment from local property taxes to retail stores with less than 20,000 square feet. The House passed it 139 to 0 (with 12 absent). Analysts determined, however, that the bill would cost the state $4.2 million in the next two-year cycle, and it, too, was eventually killed by the Appropriations Committee before final Senate passage.
Why did Democrats go for this bill when huge cuts were being made to social services?
