House Passes Bills to Address Tax Conformity and Education Funding/Reform Bill

Compromise includes full tax conformity with federal law and formation of Commission to study education funding in Maine

Augusta – This morning, a bill to fully conform to the federal tax laws overwhelmingly passed the House. In addition, a separate bill to provide more funding and accountability to Maine’s education spending also passed the House in convincing fashion. These two bills are part of a compromise reached after negotiations between all legislative leaders and Governor LePage.

  • Tax Conformity:

LD 1583 fully conforms to the changes made at to the federal tax laws after the recent passage of the PATH Act (Protecting Americans From Tax Hikes Act) in Washington a few months ago. The deal also keeps the Maine Capital Investment Credit in place. By fully conforming to the federal tax laws, we have now provided stability and predictability to our business community for the foreseeable future.

 

  • Education Funding and Governor’s Blue Ribbon Commission to Reform Public Education and Improve Student Performance in Maine:

 

  1.  LD 1641  provides $15 million in additional funding to help districts who have seen a financial shock this year due to the amount of state funding they will receive as calculated by the Essential Programs and Services Formula (EPS) that determines the state’s share of education funding. This $15 million in additional funding comes on the heels of an $83 million increase to education funding which was part of the recently passed biennial budget.

 

  1. Formation of the Governor’s Blue Ribbon Commission to Reform Public Education and Improve Student Performance in Maine.

 

Governor LePage will serve on the commission and Dr. Bill Beardsley will serve as the chair. The Commission will also consist of teachers; superintendents; representatives from Maine’s charter schools; municipal officials; and legislative leaders from both parties.

 

The Commission will be working to get to the bottom of the troubling trends such as increases in state spending on education along with a decrease in the number of students and no measurable improvement in student performance which instead has flat lined.

 

“House Republicans held strong on tax conformity from the very beginning and at the end of the day we did the right thing for the Maine people and the Maine business community,” said House Republican Leader Ken Fredette. “We have also agreed to put additional money into education which is important, but we must all realize that with more money comes a commitment to reform. The formation of the Governor’s Blue Ribbon Commission is a critical component to this. We cannot continue to throw more and more money into an education system that is not producing results.”

“I’m pleased we were able to come to an agreement that both sides could live with, but it’s disappointing that House Democrats dragged their feet this long on tax conformity. By stalling this simple bill, they’ve sent a terrible message to Maine’s small business community,” said Assistant House Republican Leader Rep. Ellie Espling of New Gloucester. “House Republicans have been saying for months now that conforming to the federal tax laws helps to encourage Maine businesses to invest and grow in our state which is vital to improving our business climate and bringing good paying jobs to Maine. In addition, we need to take a serious look at education, specifically how we’re funding education, and LD 1583 addresses that as well.”

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