Surtax repeal, Medicaid expansion add to uncertainty in Maine revenue forecast

Good morning from Augusta. A November revenue forecast presented to lawmakers on Monday found that Maine’s economy is growing. However, that rate is slower than last year and recent referendum votes have added to uncertainty around the projections.

Forecasters lowered their projections for income growth in 2017. The Maine Consensus Economic Forecasting Commission said both personal income growth and wage and salary income growth is expected to be at 3 percent in 2017, down slightly from a previous projection of 3.2 percent. While it noted that fuel prices are low, personal income is rising and foreclosures are down, Maine still faces an aging population and almost no population growth.

Some growth in tax payments was attributed to the repealed surtax on high-income earners. In 2016, Maine voters approved a surtax on all income over $200,000 for education, but the Legislature stripped it from the two-year budget passed in July. The commission said income tax payments and withholding growth were likely affected by the surtax, which wasn’t repealed by a June payment deadline. Michael Allen, Maine’s associate commissioner for tax policy, told Maine Public that the repeal could result in lower payments and higher tax refunds next year. That has been worked into the forecast, but Allen said it’s hard to estimate.

But Medicaid expansion hasn’t been worked into forecasts yet. This forecast was made before Maine voters overwhelmingly backed Medicaid expansion under the Affordable Care Act in this month’s election. The commission says it will reconvene in January to make any necessary adjustments because of that election. But Gov. Paul LePage and fellow Republicans look poised to block expansion this year, so it’s unclear if projections will need to be changed.

A new Maine license plate is in the works

Secretary of State Matthew Dunlap will unveil Maine’s bicentennial vehicle registration plate on Dec. 4 during an event at the Maine Cultural Building, which is next to the State House. The Maine Bicentennial Commemorative License Plate will feature the Maine State Seal against a dark blue background — similar to the state flag — with the years 1820 and 2020 on the sides. Sales of the plate begin Dec. 4 and will be available for display on vehicles through the end of 2020. The new plates will be available for the front of vehicles only. You can buy one, after Dec. 4, by clicking here, but you’ll have to keep your old license plate for re-use starting in 2021.

Mills opposes national park fee increases

Attorney General Janet Mills has joined a coalition of 11 attorneys general in opposition to the National Park Service’s proposal to increase fees at 17 national parks, including Acadia here in Maine. The proposal would hike the cost of a one-week pass during the five-month peak season from $25 or $30 to $70. The cost of motorcycle, bicycle and pedestrian access would also increase by double or more. Mills, who with the others has sent a comment letter to the park service, said the fee increase would “make it more difficult for working-class families to afford this experience.” Mills is vying for the Democratic nomination in the 2018 Maine gubernatorial primary.

Reading list

  • A defense analyst says Bath Iron Works is well positioned for a $15 billion frigate contract. The Navy is looking to reactivate its guided-missile frigate program to build its surface warfare force to 355 ships. Money has been requested in the 2018 budget and the overall contract would be worth $15 billion. BIW built 24 frigates in the 1970s and 1980s. The Navy intends to name five finalists next year and award a detailed construction and design contract in 2020.
  • Test drilling is beginning for a new mine in northern Maine. Canadian mining company Wolfden Resources Corp. has purchased nearly 7,000 acres north of Patten and plans to test the area for precious metals. The $8.5 million purchase, known as the Pickett Mountain property, went through Nov. 16. It would be Maine’s first new large-scale mine since the 1970s. This development comes after the Legislature enacted a comprehensive new mining bill this year that bans large-scale open-pit mining.
  • A wind power demonstration project near St. George is causing strife. The Maine Aqua Ventus deep-water wind project has been in the works since 2009 but a new announcement that the company is about to lay a transmission cable along the ocean floor has some locals protesting. One fisherman told the Bangor Daily News that the project could threaten the livelihoods of future fishermen.
  • The operator of a Portland halal market will plead guilty to federal welfare fraud charges. Ali Ratib Daham, the operator of Ahram Halal Market on Forest Avenue, will plead guilty to several charges, according to Maine Public. As part of that, dozens of other charges will be dropped and Daham will agree to at least a 33-month jail sentence and pay at least $1.4 million in restitution. His younger brother faces a trial next year.

Another British invasion?

News of British Prince Harry’s engagement to American actress Meghan Markle broke hearts around the globe and sent gossip purveyors into a frenzy. Here at the Daily Brief, we view everything through a loftier, political lens, so our first thought was: Does this new alliance represent the latest twist in the American political system’s tilt toward dynastic government leadership?

We’ve had the Kennedys, the Bushes the Clintons — and now the Trumps. Could the Windsors be next? After all, it was only a year ago that Queen Elizabeth II offered to resume British rule over the United States. If the children Harry sires with his American wife are born on U.S. soil, they could grow up to be presidents, further enhancing the possibility of a long-overdue colonial reunion. Maybe this whole Brexit thing was just to clear a path for a belated U.S. return to the empire.

Blimey, it’s all coming together like steak and kidney pie. Here’s your soundtrack. — Robert Long

Today’s Daily Brief was written by Christopher Cousins and Michael Shepherd and edited by Robert Long. If you’re reading it on the BDN’s website or were forwarded it, click here to get Maine’s only newsletter on state politics via email on weekday mornings.

Michael Shepherd

About Michael Shepherd

Michael Shepherd joined the Bangor Daily News in 2015 after covering state, federal and local issues for the Kennebec Journal for three years. He's a Hallowell native who now lives in Gardiner. He graduated from the University of Maine in 2012 and is a graduate student at the University of Southern Maine's Muskie School of Public Service.