Thursday, January 3, 2008

It's a good idea, but can it work?

I’m not sure where I stand on this one. On the one side of me, it’s a great idea. The other side says it ain’t gonna fly.

A legislative committee in Maine today unanimously passed a proposal by a Republican legislative person to cut 75 million dollars from our budget. (Read below in last night's offering of the budget woes of the sate ofr Maine.) The proposal, apparently, is in line with a Democrat controlled legislative hiring of an outside agency to study the economic woes on state government: (All quotes here are from a Republican press release)

Late last night the Prosperity Committee unanimously approved Senator Jon Courtney’s (R-York) proposal to cut $75 million from the state budget. Senator Courtney’s plan meets the goals put forth in the Brookings Report which called for an independent commission to find savings. The plan also offers tax relief by investing the budget savings in the Maine Tax Relief Fund.” Senate Republican press release.

The release goes on to say, “The plan will form a commission made up of 9 members. Four will be chosen by Democrat Leadership in the House and Senate and four will be chosen by Republican Leadership in the House and Senate. The final member will be picked by the eight appointees and will assume the chairmanship of the commission. This commission will cut $75 million from the budget; their cuts will then come to an up or down vote in each chamber.

Once the savings are enacted the surplus revenue that is brought in will be placed in the Maine Tax Relief fund. This fund will then be used to lower the state income tax. Rather then using the savings on new spending the savings will go to offering real tax relief to the people of Maine. Additional revenues above the LD 1 cap will continue to be placed in the Maine Tax Relief Fund until the income tax has been cut to 4.5%. Once the income tax has been reduced to that rate, surplus money will be released from the fund and budgeted for general purposes. Investment in the Maine Tax Relief Fund will force the state government to go on a diet keep the budget balanced and provide real tax relief for Mainers.

This sounds very good for Maine and its taxpayers. As I’ve said previously in other posts, we’re either the highest or second highest taxed state in the United States.

But the proposal doesn’t stop there. It goes on to discuss Maine’s second highest in the nation insurance costs. “In addition to the formation of this Budget Cutting Commission and tax relief plan, the prosperity committee report makes several recommendations to reduce government costs. Among these recommendations is a review of the guaranteed issue of insurance law and the creation of a high risk insurance pool. It calls for an examination of insurance co-pays for Maine Care recipients as well as looking at ways to increase competition within the insurance industry here in Maine. Each of these areas offer ways to reduce health care costs for individuals as wells as the state. ”Senator Courtney said, ‘This is a victory for the people of Maine. Getting a unanimous report was hard work and with the help of my fellow Republicans we were able to hold the line and get a report that will force the state government to be more efficient. This unanimous bipartisan report is a step in the right direction and as we begin the new session of the legislature I hope it is a sign of other reforms to come.’”Whether or not ii it is a victory for the state of Maine will be up to the Maine Legislature. The report than was passed was a committee report. Even though it passed unanimously in a so-called bi-partisan committee, it doesn’t mean it will be passed by the full legislative body. If both the Maine House and the Maine Senate don’t pass it, it will be a wasted great effort.’’

I believe it’s a great idea. I seriously doubt that the Democratically controlled houses will adopt its provisions.

(All quotes here, in italic type, were taken from the Republican press release and published on a Maine polical form, "As Maine Goes," Scott Fish, Owner and publisher.)

G. D.

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