MFPC Legislative Update May 4: It’s not over yet!

What was anticipated to be a short, quick second session turned out to be groundbreaking — and not in a positive way. The Legislature adjourned sine die Wednesday evening, but its work is far from finished and some of the unresolved issues are significant for the forest products industry. (See outcomes of MFPC’s top bills in the second session.
Before talking about what might come next, though, I want to thank our members for all their calls, emails and personal contacts with legislators, which were incredibly helpful and especially effective.
Legislators dealt with a number of vetoes May 2, but failed to override the veto of LD 1745 An Act Regarding a Biomass-generated Energy Purchase and Sale Agreement and Payments to Contractors. LD 1745, which MFPC supported, proposed to use funds not paid to Stored Solar for wood energy projects.
After vetoes were settled, bills to extend the session by five days, three days and one day all failed along partisan lines in the House and an order was passed to carry all of the bills that are currently pending into a special session of undetermined length with a date to be determined.
There are about 120 bills still pending on the Special Appropriations Table and the Appropriations Committee hasn’t prioritized them. The bond package hasn’t been framed or voted out of committee. There are roughly 70 bills pending between the House and the Senate, including several significant ones for MFPC:
  • LD 1655 An Act To Update References to the United States Internal Revenue Code of 1986 Contained in the Maine Revised Statutes (tax conformity).The Taxation Committee was divided on State conformity with the recent federal tax changes. Despite the current stalemate, we think there are still areas of agreement that could be achieved between parties in a special session but it is unlikely there will be compromise on everything. For example conforming State estate tax thresholds with the federal level remains a large policy debate. Conforming to bonus depreciation, or substituting it with the Maine Capital Investment Credit, will be a big help to businesses. Without action the personal exemption is maintained in Maine, which should offset concerns about an overall rate increase to individuals. Without conformity, businesses will be burdened with having to keep “two sets of books” for federal and state purposes, and Maine’s tax system will become much more complicated and difficult to administer. This  is  not something that can be put off until next year.
    LD 1862 An Act To Establish Municipal Cost Components for Unorganized Territory Services To Be Rendered in Fiscal Year 2018-19 (UT budget).
  • LD 1844 An Act To Provide the State the Right of First Refusal for the Purchase of Certain Land on Which a Subsidy Has Been Paid. Read MFPC floor sheet.
  • LD 1744 An Act To Create the Hire American Tax Credit for Businesses That Hire Residents of the United States. Read MFPC floor sheet.
  • LD 1654 An Act To Protect Economic Competitiveness in Maine by Extending the End Date for Pine Tree Development Zone Benefits. The Pine Tree Zone is an important business incentive that should not be allowed to expire this year.  Without the Pine Tree Zone program, the State of Maine will lack a tool that is frequently used to attract expanding businesses to the State, and will fall behind other states that have robust business attraction incentives at the state level.

After a cooling-off period, legislative leaders will discuss what comes next. It’s not anticipated a special session will be called until after the June 12 primary. The state Republican convention is going on now and the Democratic convention is May 18-20, followed by Memorial Day weekend (May 26-28). Ranked choice voting also may delay the primary vote count.
When legislators do return for a special session, it remains unclear what exactly they’re going to do. Obviously, everything is carried over and still alive, but leadership will be negotiating what they will actually consider, ranging from everything to just select matters.

One thing that might shorten a special session is that since the Legislature adjourned sine die, candidates can solicit campaign funds, but when the special session begins, the restriction on fundraising will be reinstated. The governor will have 10 days to veto any bills approved in the special session and legislators must reconvene to deal for another veto day. It’s possible a special session might not end until early July.

So we’re definitely not done yet, we still have some significant bills pending and we need your help to see this session through. When we know when the Legislature will return, we will notify you. So be on the lookout for legislative alerts because your influence can help. Our members can really make a difference at the Legislature.