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Welcome to the Policy Blog at the Maine Corner Store! We understand that most small business owners simply don’t have the time to stay abreast of all the legislation and regulation that our legislators churn out. So our legislative experts keep up with anything coming out of Augusta and Washington that might affect your business. It's like having your own Public Affairs department, at no cost.





A Disappointing Outcome in Comp

Posted Monday, April 30, 2012 by Peter Gore


By now most of you have read that Maine has made changes to the workers comp law passed nearly two decades ago.  That is not an insignificant event.  For most of those years, workers’ compensation as a public policy issue was considered a third rail. For good reason, the reforms enacted in 1991 and 1992 were preceded by a government shutdown, and lingering bitterness.   In fact, until the action taken by the legislature this session, no major piece of workers’ compensation legislation had been enacted by lawmakers since the “Kotch” battle in 2002.  That experience 10 years ago also left an indelible mark on both parties as well as the labor and management communities for the level of emotion left in its wake.

So when Rep. Andre Cushing (R-Hampden), introduced legislation proposing an extremely extensive re-write of the 1992 reforms in the First Session of the 125th Legislature, many in the legislature and business community reacted warily.  The Labor, Commerce, Research and Economic Development Committee (LCRED), tasked with dealing with the bill adopted a methodical and cautionary approach to their work on the bill.  In fact, the issue had nearly a year’s worth of study and then committee work. But despite this, the end result was almost predictable.

As a longtime comp observer I could and did predict – in this legislature - an outcome in which labor would oppose the final committee product and democrats in the statehouse would back them up.  I could and did predict an outcome in which employers would support the final product and republicans in the statehouse would back them up.  And while my predictions at first proved to be spot on, in the end I was not quite right.

At the center of the controversy surrounding L.D. 1913 was how and to whom this state going forward, would make eligible for comp benefits for injures that result in a “partial incapacity” beyond our ten year cap.  Under the 1992 law we guarantee that 1 in 4 workers with this type of injury will qualify for benefits beyond the cap – in many cases up to lifetime.  No other state makes such a policy guarantee.  The business community had long wanted to change this portion of law – labor had steadfastly refused.  The work of the committee, administration officials – lead by Paul Sighinolf;, the Executive Director of the Workers’ Compensation Board (WCB), and business community reps (myself and others) produced what we all believed was a responsible and fair alternative to the existing law.  And so it went to the full legislature for their approval.

And that’s where my prediction slid off the rails.

The House, on what can only be described as a very courageous vote, approved the majority ought to pass report along party lines, with republicans supporting and democrats opposing.  I can tell you, for many, supporting the majority report wasn’t easy.  But they did it because it was best for employers, employees and the state as a whole.

Then the bill went to the senate, where most believed passage was a foregone conclusion.  In hindsight that may have been our mistake.    Senate Republican leadership informed the business community they lacked the needed votes to pass the majority report as approved by the House.  Changes – amendments – a weakened bill would be required to achieve passage.  Bi-partisan passage was the goal. 

R leadership couldn’t and wouldn’t tell us which senators had a problem with the house version of the bill.  Without that knowledge we couldn’t effectively lobby the bill.  So negotiations were held with republican and democrat senators, labor, and the administration, a compromise was reached, and the senate voted to support a different- albeit weaker – version of L.D. 1913.

It was not a version of the bill the business community was willing to support.

The house was in the unenviable position of agreeing with the senate version or having the entire bill die and keep the old law in place.  I have to imagine that for many house members, knowing the business community could not support the compromise but also knowing that the bill faced certain death without their agreement, made it one of the toughest votes of the two year session.

In the end the house relented, accepted the senate version of the bill, and it went on to become law on.

So after the dust has settled what are we left with? 

In some way it can be argued that we have a better comp law from the perspective of the business community.    No longer is there an automatic guarantee that 1 in 4 injured workers will be entitled to lifetime benefits regardless of their ability to work.  But the true overall impact of the bill as passed is really unknown. There is still plenty of room for litigation and thus for attorneys to manipulate the system.  How successful…or unsuccessful they are in doing so may determine, over time, the effectiveness of the compromise legislation  

But the sting of bitter disappointment for the many in the business lobby is that we could and should have done more.  Opportunities like that posed by L.D. 1913 only come along once a decade – not years.  The law passed this session is likely to be the law for many years to come.  It should have been the strongest – yet fairest law possible.  Some will argue that is exactly what we have, and it may be so.  But the failure of the senate to even take a vote on the house version, or to give the employer community a chance to talk with republican senators who may have questions about the proposal, ensures we will never really know.





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A Message From the President...

Posted Monday, April 09, 2012 by Dana Connors


"Today's workforce is tomorrow's workforce…"

Maine already holds the distinction of being the grayest state in the nation.  Coupling the rate of aging with Maine’s slow population growth presents a most compelling challenge. Making Maine Work—the Maine State Chamber’s joint report with the Maine Development Foundation—brought to light what the aging of Maine’s population and the barely noticeable increase in our population growth means for our workforce, our employers, and our economy.  As our people age during the next 20 years, the workforce we have today is essentially the workforce we will have in the future as well.

In the past seven months, we have been involved in three workforce initiatives that offer creative solutions to these issues by employing sectors of our population that were previously under-utilized in order to meet Maine’s unique labor challenges and boost their bottom line. Companies such as The Jackson Laboratory, Fairchild Semiconductor, and Barber Foods have been able to meet their workforce needs by employing Maine’s immigrant community.  Others, such as P&G/Tambrands, Le Garage, L.L. Bean, and Inland Hospital, have turned to Maine’s disabled population to solve some of their workforce shortages. And still others are successfully matching their needs with the skills and talent of our veterans. 

In September 2011, we hosted “Staying Competitive in a Global Age:  The Role of the Immigration Community in Maine’s Job Creation,” a joint effort in collaboration with The Partnership for a New American Economy (www.renewoureconomy.org).  The event encouraged a greater understanding of the role of immigrants in our state and the impact that the immigration community has on our economic success both today and for the future. 

In October and November 2011, we hosted a Hiring our Heroes (www.uschamber.com/veterans) job fair specifically for Maine veterans and military spouses.  This nationwide program was launched earlier this year by the U.S. Chamber of Commerce and works with state and regional chambers in an effort to encourage companies to hire veterans.  In addition, we are partnering with the Maine Manufacturing Extension Partnership to offer Jobs Now for Maine Vets, a new private-sector job training initiative that will complement a national Hiring our Heroes initiative.

And just this week, we hosted “Maine’s Untapped Workforce: How hiring people with disabilities makes good business sense,” in partnership with the Maine Department of Health and Human Services and the Maine Department of Labor (see page 11). Hiring people with disabilities is a proven strategy.  And, the result is overwhelmingly win-win: employers get reliable, productive, high-quality workers; and, job seekers with disabilities gain new skills, economic independence, and a better quality of life.  Beyond that, people with disabilities, as customers, have an annual buying power of $3 trillion and an aggregate income of $220 billion.  And 88% of Americans prefer to give their business to employers who hire people with disabilities (more at ThinkBeyondTheLabel.com).

Going forward, Maine needs to keep an open mind as we seek to attract and entice workers—because we have real opportunities before us to expand our workforce and to meet the needs of businesses across our state. We will need to break down the barriers and create opportunities in accepting and including diversity of many types in the workplace.  Because in the end, we all benefit from employees who are skillful, loyal, eager, and who come to work with the attitude to do their very best every day.

These few examples of investment and inclusion in the workforce have not only made good business sense for those employers but they are also a proven investment that yields a great return.  As Maine seeks to address the inevitable workforce issues presented by our aging and slow-growing population, I encourage you to get creative in meeting those needs.  It will take everyone to build a stronger Maine!





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LD 1858

Posted Friday, March 23, 2012 by Jessica Laliberte


It has been an interesting couple weeks for me as I sat in the Joint Standing Committee on Education and Cultural Affairs listening to the Governor’s education bills being debated.  For ten years I was classroom teacher.  As I sat and listened to testimony in support and opposition of bills a little voice in the back of my head kept saying “How would I feel about this if I were still in the classroom?”

As much as I hate to admit it, there are bad or ineffective teachers out there. I know this because I worked with some.   Every profession has them.  Would you want an ineffective doctor operating on you?  How about an ill trained mechanic fixing your car?  A police officer who is not meeting standards patrolling your neighborhood streets?  Every other profession has safeguards in place to weed out those in the profession who are not performing up to expectation.  That little voice in my head kept saying “why should it be any different for teachers?”

The Governor’s bill, LD 1858, An Act to Ensure Effective Teaching and School Leadership, is an effort to hold teacher’s accountable.  Research shows that having an ineffective teacher for just one year can have a big impact on a child’s education.  I saw the effects of this too.  I knew which kids came from classrooms where teachers were effective and innovative.  I also saw the results when a child had a teacher who was less than effective.  That child was behind and had to play catch up.  The bar for what children are expected to accomplish in school has been raised.  So why not raise the bar for those delivering instruction?

Several hours of testimony was heard on this bill.  Dozens of teachers turned out to speak against the bill.  One by one they stood before the committee and told lawmakers if this bill were passed into law teachers would be stripped of their due process thus making it easier for administrators to get rid of them.  One teacher said LD 1858 would create a climate of fear.  What if the principal had an ax to grind?  When I first heard the Governor’s proposal (thinking like a teacher) my first reaction was to not like the bill.  But then I started to reflect on my teaching and my experiences.  Sure, I worked for some terrible principals. But I also recognized that I worked darn hard to make sure I was the most informed and best trained teacher I could be.  I owed it to my kids.  I thought too of the teachers I worked with over the years that bucked every change.  They were the ones that put themselves first, not the kids.  I thought of the teachers that spend little if any time crafting lesson plans.  I thought of those that refused to partake in professional development or collaborative learning groups.   Those are the teachers that need to be evaluated and held accountable for their work. 

Education Commissioner Stephen Bowen listened to the teachers concerns about due process and having a role in developing the evaluation systems.  He took what he heard and drafted a nine page amendment to the bill.  His amendments included language that clarifies “that a summative rating of ineffective for 2 consecutive years is just cause for nonrenewal, unless the ratings are the result of bad faith.  Bowen amendment also included a definition of a “professional improvement plan”- a written plan developed by a school or district administrator with input from the teacher or principal that outlines steps to be taken to improve the teacher or principal’s effectiveness.  Another key piece of Bowen’s suggested change include establishing The Maine Educator Effectiveness Council which will have a vast array of members from the business community, college prep institutions, DOE , teachers, school board members and school administrators.

With Commissioner Bowen’s amendment the bill got unanimous backing of the Education and Cultural Affairs Committee.  The bill now head to the House and Senate.





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Governor’s Controversial Education Bills Heard

Posted Saturday, March 17, 2012 by Jessica Laliberte


Bills that would create open school enrollment, allow public funding of private religious schools, hold teachers more accountable for being effective and mandate  technical and career education school calendars align are all part of the Governor’s plan to reform education in the state of Maine.  Public hearings were held this week before the Joint Standing Committee on Education and Cultural Affairs on the controversial measures.   The proposals drew large crowds and testimony on the measures lasted well into the evening.

Dozens of teachers turned out Wednesday to tell committee members if LD 1858, An Act to Ensure Effective Teaching and School Leadership, is passed into law it will be easier for administrators to get rid of continuing contract educators.  Education Commissioner Stephen Bowen said that is not true.  He said the goal behind the bill was to create a rigorous model where teachers are given feedback and allowed to improve.  Bowen told legislators that of the 160 bills that have gone before the committee during the 125th session, none “no other bill has the potential to impact education in Maine like this bill does.”  Teachers claim if passed this bill would strip them of their right of due process.  The bill states if a teacher receives an ineffective rating for two consecutive years it is grounds for non renewal.  Teachers may not appeal the professional judgment of the evaluation, only the process by which the evaluation was done. 

Should private religious schools receive state funding (LD 1866, An Act to Remove Inequity in Student Access to Certain Schools) and should students and parents have a say in what school their child attends (LD 1854, An Act to Expand Educational Opportunities for Maine Students)?  Those were the heated topics before the committee on Thursday.  The Governor is proposing the state strike language from law that says only nonsectarian private schools may receive public funds for tuition.  LD 1854 would allow schools to opt into an open enrollment system.  Funding would follow the student to the school where they attend, not the community where he or she resides.  Opponents say this jeopardizes small and rural schools and would create a two tier education system which would put disabled and low income students at a disadvantage because they would not have the means to seek other school options.  Backers of the bill say lines on a map should not determine where a student attends school.  Kids should be able to have a choice in where they go to school and be allowed to match school with their learning styles.

The least controversial bill, LD 1865, An Act to Enhance Career and Technical Education, would require schools to have common calendars with no more than 5 unlike days and allow students earn credit for programs that use national industry and state certification standards. 

The bills have work sessions this coming week.  The education committee will also have budget hearings with appropriations on Wednesday.





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A Message From the President...

Posted Monday, March 12, 2012 by Dana Connors


Legislators are not shying away from the key issues…

The Second Regular Session of any legislative session has a tendency to move along pretty rapidly, due in large part to its limited days and a smaller number of bills to deal with.  However, one of the biggest differences in this particular session, as many long-time legislative observers have noted, is the magnitude of the issues that remain to be addressed.  Generally, the short session hosts complex budget discussions then focuses on legislation carried over from the previous session, with very few new proposals. 

This session appears different, with legislators not shying away from complex or controversial issues, despite the election cycle.  Up to this point in the session, we've seen or anticipate progress in regulatory reform, energy policy, workers' compensation, tax policy, and education reform.

With the recent passage of the supplemental budget, discussions will turn to the next biennial budget.  Those discussions get more complicated with every passing day.  I would like to take a moment and congratulate both the leadership and the rank and file of the 125th Legislature for the way it conducted itself in order to pass a two-thirds supplemental budget.  There is great significance in achieving this goal, getting that process behind them, and positioning the bodies to deal with both the remaining budget questions – as well as the many important policy issues that remain before them in the next 5 weeks.  It also provides hope for the rest of us in anticipation of addressing other issues facing our economy.

And speaking of progress and success, I want to point out to our members that the Maine State Chamber recently launched two exciting new products this month.  Our weekly video series, the Legislative Week Ahead, is designed to aid our members in staying current with the happenings at the Statehouse.  And News That Matters to You provides a focused compilation of daily headlines from Maine's leading news sources on business, politics and other issues of importance to you.  These latest member offerings are intended to provide you with increased information and connectivity to our efforts on your behalf.  Together, we are the Voice of Maine Business, and together, we will build a more prosperous Maine.





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The Discussion About Workers’ Comp

Posted Thursday, March 01, 2012 by Peter Gore


If you have been following IMPACT, and even some of the daily newspapers, you may have picked up on the fact that the Maine legislature is having one of the most significant discussions about the future of our workers’ comp system in more than 10 years. 

As a small business person, you may – or may not – be wondering why comp should be a topic of debate.  For most employers, since the enactment of the comp reforms in 1992, rates have gone down.  I recognize this isn’t the case for all employers, but for most this has proven to be true.  Equally important, the number and severity of workplace injuries have fallen dramatically.  That means employers in this state have taken the message regarding the benefits of a safer workplace seriously.  They recognize the best way to lower their comp premiums is to make sure injures don’t happen in the first palace.

So with this good news, you may ask, ‘why should the legislature look for trouble and make changes to an act that, for the mast 20 years has proven to be successful for both employers and employees?”

The answer is it can do more for both.  It can be improved on, and now is the time to make our system better.

The Labor, Commerce, Research and Economic Development Committee (LCRED) has spent more than 10 hours reviewing a proposal crafted by the Workers’ Compensation Board (WCB) Executive Director Paul Sighinolfi that seeks to both increase benefits for injured workers, but also bring certainty to a controversial part of the 1992 reforms that have long troubled employers. The proposal doesn’t have a Legislative Document (L.D.) number yet, but it will soon.  We will let you know when it does.   But what we do know is that workers comp, as a public policy issue, has long been a flash point for emotions in the statehouse, and Sighinolfi’s proposal is no exception.

The public hearing on the proposal produced almost 7 hours of testimony – with opponents lead by organized labor and trial attorneys outweighing proponents, including the Maine State Chamber.  The work session earlier this week was somewhat of a different story, at which Sighinolfi was able to dispel much of the opponent rhetoric and scare tactics simply by answering the questions the committee had posed to him during the public hearing, and by providing them with evidence disputing allegations that people might lose their benefits should some of the proposed changes be made.

At the heart of the issue is this – will organized labor be willing to accept considerable increases in benefits for the people they say they represent – in exchange for eliminating a portion of the act that has long brought instability and uncertainty to the system; something that is important to employers.

In the coming weeks expect to hear much about this issue.  Unless the two sides can come together on this issue…and that question is most certainty in doubt…then the debate on the proposal is sure to be contentious.  Both side will work hard to make their points as to why they bill should be passed or rejected.  From our prospective, remember this – the employer community is prepared to accept this proposal knowing it may result in a slight cost increase over the short term to comp costs.  Why?  Because the proposed changes – on balance - will result in a better system for both stakeholders.

I have written about the details of Sighinolfi’s proposal on page 6 of the February 9th issue of IMPACT.  The link to that issue is here: http://www.mainechamber.org/docmecc/Publications/Impact-2012_PDFs/Impact12_04Feb09_WEB.pdf

Take a few minutes to read over what is being considered and the issues in play.  I think the problems with our current law become clear, and the solutions presented by Sighinolfi and supported by employers reasonable.  If you have questions, don’t hesitate to call or email me. 





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Governor Rolls Out Controversial Education Plan

Posted Monday, February 13, 2012 by Jessica Laliberty


Proposals Draw Criticism from Educators

Student choice in where they attend school and public funding of private religious schools are two of the most controversial pieces of Governor Paul LePage’s education proposals he laid out Wednesday.  The Governor unveiled four proposed pieces of legislation that could vastly change the landscape of education in the State of Maine.

One of the bills would remove statutory language that prohibits public funds from going to private religious schools.  Another of the Governor’s education proposals would give students greater choice in the schools they attend.  It would create an open enrollment where students could attend whatever schools they wish if the school district accepts them. “Schools of choice” would not have to provide transportation.  Critics of the plan say it puts students of single parents, working parents and those of limited means at a disadvantage for attending schools outside of their immediate community.

The Governor says the legislation aims to provide students and their families more power to choose the school setting that is best for each student.  Another LePage proposal would take steps to ensure students are being taught by effective teachers.  Multiple measures such as student achievement and growth would be used to evaluate teachers and would be used in making staffing and personnel decisions.

The final piece of the Governor’s education plan is designed to enhance career and technical education by requiring school districts that share a career and technical center to develop a common calendar and accept credits student earn at the centers.  The proposal would also call upon the Maine Community College System to review state and nationally certified programs and determine the amount of college credits a student could earn by successfully completing courses.





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Education Reform

Posted Thursday, January 26, 2012 by Jessica Laliberty


The state’s education system could face a massive overhaul and change how Maine’s school children are taught and assessed.  The legislature’s Education and Cultural Affairs committee voted unanimously to back LD 1422, An Act to Prepare Maine People for the Future Economy.  The 11-0 “ought to pass” vote signals strong support for the measure that would institute a standards based model where student progress upon demonstrating proficiency on a set standard or skill.  Under the current model students earn credits.  If LD 1422 is passed into law, students starting with the class of 2017 would have to show proficiency in eight core academic areas as well as the five guiding principles of the Maine Learning Results.  The eight core academy areas are:

  1. Career and education development
  2. English Language arts
  3. World Languages
  4. Health, Physical Education, and Wellness
  5. Mathematics
  6. Science and Technology
  7. Social Studies
  8. Visual and Performing Arts

35 schools around the state including schools in Hallowell, Oakland, South Portland, Bingham and Auburn have begun work on a standards based framework.  Education Commissioner Stephen Bowen said this model gives students “voice and choice” in their education.  Students would have input in how they demonstrate proficiency.  The commissioner told members of the committee that under this plan students would be given a wide variety of learning opportunities and settings−“Learning outside the classroom should count.”  Bowen envisions building community partnership to provide kids these opportunities.





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Legislative Issue Spotlight - Part III

Posted Thursday, January 12, 2012 by Peter Gore


WORKFORCE DEVELOPMENT

We have seen the workforce development, or “skills gap” issue leapfrog many other issues in the past year.   Employers – particularly in the manufacturing sector – indicate that good paying jobs with quality benefits are going unfilled in their company due to a lack of properly skilled applicants.  Maine’s unemployment rate resides at about7% statewide, yet thousands of jobs going unfilled everyday due to lack of properly trained workers.  Now add to this equation the fact that Maine, as a percentage of population, is one of the “oldest” states in the country.  Those older workers will retire, and many currently work in highly skilled jobs.   Who will fill those jobs when they retire?  We know that, as a state, we are staring down the barrel of an imminent problem that will get worse with time unless we address it immediately.

It is likely that, as we head into the upcoming legislative session the Governor’s proposal to add a 5th year of high school in order to allow students to learn a skill before they enter the workforce, will be the central theme of the workforce development discussion in the statehouse.  This proposal is likely to be controversial, in part due to cost.  In addition, legislators are likely to have their own ideas on how best to address future workforce preparedness.  The Chamber will work with legislators and the administration during this process of how best to identify the right skills needed by the business community, and assist in developing a strategy that will helps us meet the challenges ahead.

In addition the Maine Chamber has joined with the national campaign “10 by 20 Pledge for America” campaign, which challenges states and employers us nationally to identify and train 10 million skilled workers by 2020 simply to replace our retiring skilled workers.  This initiative, hosted by Center for America, spotlights hundreds of training programs across America that provide the skills necessary to fill millions of jobs.  The Maine State Chamber will be working with various partners during this campaign, including the Legislature, the LePage administration, the Maine Community College System, the Maine Manufacturers Association, and the Maine State Chamber’s InternHelpME.com program.  This is just one small part of the larger issue that will dominate policy discussions over the next decade.

ENVIRONMENTAL ISSUES

One of the hallmark issues of the First Legislative Session of the 125th Legislature were environmental issues.  The legislature made significant changes this past year in this policy area, from reforming our chemical laws, to making our environmental regulatory system more business friendly, along with many other changes to Maine’s environmental laws that both protect our environment and improve our business climate.   Due to the major changes that were undertaken this past legislative session the legislature is likely to adopt a wait and see approach to better determine the impact of the major environmental changes recently enacted have before moving ahead with further new initiatives.  However they will deal with carry over legislation and report backs to the committee from the department.  The top of this list will include shoreland zoning regulations and product stewardship.

The Maine Chamber stands ready to work with the Environmental and Natural Resources Committee and the DEP on the report backs from the Department and carry over legislation with the goal of ensuring that we continue to work towards a balance of protecting our environment and improving our business climate.


These are just a few of the issues we expect to be working on for you.  Please don’t hesitate to reach out to us with questions.





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Legislative Issue Spotlight - Part II

Posted Tuesday, January 10, 2012 by Peter Gore


LABOR AND WORKERS’ COMPENSATION

2011 saw little labor bills of consequence, this despite a combining of the Labor and the Business, Research and Economic Deployment Committees. As we move into 2012, it appears the new LCRED Committee may have more to discuss, particularly in the area of unemployment insurance.  While Maine’s UI Trust Fund remains strong and solvent, employers are increasingly expressing their frustration with what they see as systemic flaws.  These concerns have been voiced to both individual legislators as well in the statewide Job Summits the Governor has undertaken.  As a result of those discussions, it is expected that the LePage administration will submit a legislative package to address some of these concerns.  Of particular concern to some employers is the rejection of a bona-fide job offer by UI recipients in favor of continuing to collect benefits.  It appears very likely that legislation will address this issue specifically as a continued cost driver to the UI system.

Remarkably, the core of the 1992 reforms passed almost 19 years ago, remain as law in this state.  Given the turbulent history of workers compensation policy in Maine, this is really a surprising development.  To be clear, there have been considerable attempts to alter the reforms since their passage; most from the labor, and none of significance succeeded.  This year, however, policy suggestions for more sweeping changes to the 1992 act come from the employer side of the aisle.  L.D. 1571, submitted at the end of the 2011 session, seeks multiple changes to current law, but the most significant and controversial concern benefits to injured workers with a “partial incapacity” (section 213). Benefits costs associated with this section of our law have been cited as considerably higher than other states in the northeast region.

Without question, significantly altering the 1992 reforms places the business community in a difficult position.  Employers have long pointed to Section 213 as the most significant cost driver in our law; promoting litigation and contributing to instability in the reforms.  But making the changes necessary to bring certainty to the comp act will not come easy, and run contrary to the arguments the business community has used in the past – that of preserving the sanctity of the reforms.

TAX AND SPENDING

The work done by the legislature and Governor LePage in 2011 was historic,  lowering Maine’s personal income tax rate, increasing the out of state resident tax period, conforming with the federal tax code, enacting bonus depreciation and increasing the estate tax exemption from $1 million to $2 million.  Despite this major overhaul the weight of our overall tax burden continues to be cited as a barrier to a stronger and more diverse economy.  In “Making Maine Work,” Maine businesses expressed a firm belief that ongoing meaningful and effective tax reform efforts must be in concert with spending restraints on state and local governments in order to reduce the overall tax burden on both Maine business and the people they employ. 

For the business community in Maine, taxation priorities are more than reducing our income tax rate – though lowering the income tax rate is our top priority.  The Maine State Chamber has long identified the importance of tax policies that allow for, and encourage, business investment.  Incentive programs like the Business Equipment Tax Reimbursement (BETR) program and Pine Tree Zones – to name but two - are critical tools that allow Maine employers to compete on the global stage, and represent the few economic development tools we hold out to encourage business to locate or expand here.  We remain committed to supporting policies that enable existing businesses to invest and expand their businesses – allowing for the creation of jobs and out of state investments, and the preservation of investment incentives like the BETR Program. At the same time, we expect to oppose any attempt at eliminating vital sales tax exemptions currently in place and utilized by the business community.  Adding to the cost of doing business in this way only hurts our competitiveness, and lessens the likelihood of future expansions or attraction efforts, particularly in the manufacturing sectors.

The Governor has made statements that eliminating the taxation of private sector pensions will be a priority for him this upcoming session.  This could be an effective tool in attracting and keeping retired CEOs and businesspeople in Maine, which in turn can help spur capital investment.  The price tag for eliminating this tax is considerable but we look forward to working with the administration and the legislature to explore the possibility of this idea to help retain some of our best and brightest during their retirement years.

We expect to continue to monitor developments with the upcoming supplemental budget.  While it appears there may be a need to address shortfalls in the current biennial budget, it is likely the legislature will again seek to reduce spending levels rather than raise revenue.  This is particularly important given that BETR funding, last session, legislators agreed once again to fully fund the BETR Program after previous legislature reduced the programs funding as part of budget cutting measures.  To change the rules, once again, in mid- stream, would only serve to undermine business confidence in the future of the program – a program that is responsible to encouraging $100 millions in investments to expand and modernize plants and equipment that have created or preserved thousands of good paying jobs in this state.  In order to maintain our competitiveness, we expect to closely monitor events in the tax and Appropriations Committees.

Check back here soon for part III.





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Information on this site is intended to provide guidance, not legal advice. Since exact language and definitions of key terms are critical to understanding the requirements of legislation, rules or laws, we encourage you to read each carefully. Articles, blogs, and information offered here may be reprinted with attribution given to “the Maine Corner Store, a program managed by the Maine State Chamber of Commerce.” Please address comments to Melanie Baillargeon, director of communications, by calling (207) 623-4568, ext. 20, or by emailing melanieb@mainechamber.org.

 
 
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