THE CHAMBER NEWS
WHAT WE STAND FOR From the business perspective, the 125th Maine Legislature made significant progress. That’s particularly true for every organization, like The Chamber, that’s championed lower taxes, reformed health insurance markets, and a better regulatory climate. It was particularly good to see that most of the 125th legislature’s work was bipartisan, starting with a state budget that many thought would never pass; as well as regulatory reform, charter schools and hundreds of other bills. The governor and lawmakers worked together across the aisle in Augusta this year, setting an example for their badly divided colleagues in Washington DC. So what was accomplished? Income taxes were lowered. Maine moved toward conformity with federal tax laws. Market reforms were instituted in the health insurance market. Regulatory reform began with the passage of LD 1.
Some Progress But … Insurance Costs and Taxes are Still a Problem There are absolutely no surprises in the top policy issues that must be addressed in order to grow local business. The Chamber perennially advocates for these highestranked issues in “What We Stand For”: *Cost of Health Insurance *Cost of Workers Comp Insurance *Property Taxes *Income Taxes *Cost of Energy in Maine
Resources Needed by Businesses To compete in today’s global, mobile economy, businesses continue to cite the need for telecommunications infrastructure more than any other resource. Other needs include: quality of life assets such as recreation and cultural amenities and quality K-12 schools.
CHALLENGES STILL FACE MAINE For the 126th Legislature, priorities have not changed. We need to “stay the course” and build on reforms enacted in the 125th Legislature. Maine businesses face the following challenges in seven policy areas:
Health Care and Health Insurance Reform The high cost of health insurance remains the most important issue for Maine employers and their employees. Last session, the Legislature aimed to stabilize the costs of health insurance. And those costs have been evened out in the individual market and for some small businesses. For others, the costs have continued to rise far beyond their ability to pay. The ultimate solution to this huge problem is a universal coverage system. The most significant way to stem the rising cost of health insurance is to have everyone in “the pool.” The results of the 2012 election reaffirm that the Affordable Care Act will not be repealed. We need to move forward.
Maine moved toward conformity with federal tax Five actions will continue work on this perplexing problem: laws The underlying costs of health care must be stabi Market reforms were instituted in the health insurlized through efficiencies and eliminating costly ance market redundancies. Regulatory reform began with the passage of LD 1 Health care must be provided in the most cost-
effective settings -- meaning that many services must not be delivered in the emergency room and others should be provided regionally. The State must stay current with what it owes health care providers. Barriers to associations providing health insurance need to be removed. Maine must immediately participate in setting up an exchange under the Affordable Care Act while federal assistance is available and so we do not let others set policy for us. While it is probably too late to have a stand-alone exchange, Maine could become part of a “Partnership Exchange.”
Tax and Fiscal Policy The 125th Legislature made progress on tax policy: Conforming to the IRS on section 179 business expense deductions. Allowing bonus depreciation. Lowering top income tax rates from 8.5% to 7.95% with fewer graduated tax levels. Simplifying the Maine Opportunity credit for students who go to school in Maine and remain in Maine after college to work. Setting the $2 million exemption on estates and simplify filing requirements. The 126th Legislature needs to continue progress and achieve more conformity. It must: Lower overall tax rates. Maine continues to have one of the highest property tax burdens in the country and one of the highest income tax rates. Improve Maine estate laws and decrease retirement income taxation. Eliminate the property tax on personal property completely. It is a very cumbersome tax to report and few states have it. Align Maine’s public assistance benefit levels and eligibility with the national median. Further, changes at the state level must not increase the fiscal burdens on municipalities.
Government Structure Over the past two years, considerable progress has been made in consolidating state government agencies. Time will judge the effectiveness of those efforts. Within the legislature and at the local government level, no real progress has been made. We still have more than 800 local and regional governments and special districts
across the state. Simply put, Maine has too much government. At county and municipal levels we must continue to work toward more cost effective governance. Both state and local governments need to focus on restructuring. They should: Formulate and pass a constitutional amendment to reduce the size of the Maine Legislature. Institute strong incentives for intergovernmental collaboration. Centralizing services like emergency dispatch centers would greatly increase both efficiency and effectiveness and lower costs. The State should create “bonus revenue sharing” to recognize collaborative efforts that save taxpayer dollars. The Lewiston/Auburn area needs to continue to be the statewide leaders in developing collaborative solutions to local problems, looking to consolidate additional municipal functions (including schools).
Education and Workforce Training Our businesses have reported the need for a more educated and skilled workforce in order to reach full economic potential. In the Lewiston/Auburn area, a significant number of positions go unfilled because of a lack of qualified applicants. The following actions must be instituted: Implement the Governor’s concept of the “5th year” for high school students, allowing those who have met graduation requirements to take college courses or enroll in a career technical course. Change learning systems to establish a successful path for all students, whether that is higher education, specialized training, or entering the workforce. K-12 systems, with the support of the business community must ensure that all students leave school “ready to work” or ready to continue their education. Consider alternate means of education on a wider basis to ensure success for all: charter schools, distance learning, alternative schools, etc. Reallocate resources to create a unified, highquality, statewide pre-K effort. Locally, work has been done to develop a mutual understanding of what employers need and how businesses and schools can work together to meet those needs. This has led to the “Put Up or Shut Up” project presentations by each group to the other, the Young Entrepreneurs
Academy (YEA!), and a rejuvenation of the Adopt-A- D is poor and condition and capacity will likely have School program. Continued conversations and collabo- a negative impact on economic activity. In summary of their review the ASCE stated: “Maine’s economy is ration between all stakeholders must be a priority. built in its infrastructure. The health, safety and Energy Costs & the Environment welfare of our citizens are directly tied to the quality of our infrastructure. Current and forecasted funding High energy costs in Maine compared to other states is inadequate to meet current and future needs.” puts the State at a disadvantage for attracting new businesses and retaining existing ones. Energy costs The LA region has distinguished itself as a hub for intermodal freight movement while transportation, need to go down to make Maine and our region more distribution and logistics is one of the fastest growing competitive. Providing leadership in this effort will sectors in the LA region. Nationally it is recognized also attract businesses to this region as they will view that a key to the economic future with global competius as having innovative thinking and being environ- tiveness is our capacity to efficiently move goods and services. Fundamental to such a strategy is world mentally conscientious. class telecommunications. Maine needs to have diversity in power generating sources. Natural gas, biomass, hydro, wind, Towards these goals, we recommend the following pritidal, and solar are all alternative generation orities: sources which should be explored and encour Authorize a legislative study to evaluate the aged based upon current and future availability, tolling of the parallel routes, the I-295 corridor technology, and financial performance. This between Portland and Augusta with the I-95 / should be one part of a coordinated state energy Maine Turnpike corridor. The public needs to policy. understand how the free Interstate 295 with Maine should encourage those communities more exits impacts the competitiveness of the willing to support trash-to-energy plants to exL/A region. Continue to work with the Maine pand their facilities, if feasible, to prevent the Turnpike Authority to establish toll equity for additional landfilling of municipal solid waste. travelers making the trip from LewistonIntegrate local power districts serving local conAuburn to either the Portland or Augusta areas. sumers of additional energy into industrial parks Establish commuter and passenger transportaor other unique economic development assets. tion services between downtown Lewiston Power generation cost savings must be suppleAuburn and Portland, with key links to include mented by expanded energy conservation to the Portland Transportation Center and the minimize the demand on any and all fuel Portland International Jetport, to foster exsources. panded transportation choices for the region Communities should develop and identify load and enhanced access to jobs for unemployed density areas (high energy consumption areas, and underemployed residents of our downtown businesses, high residential density areas). This neighborhoods. base load data can identify areas to explore State government needs to provide leadership non-traditional generation for heat, power, and funding to resolve the State’s tremendous infracooling. structure problems. Develop pedestrian and alternative transportaTransportation and Infrastructure tion integrated with expanded transit and rail passenger systems. Multimodal transportation and infrastructure are Improve the telecommunications infrastructure, critical to thriving businesses in Maine. The Maine especially high-speed broadband to keep Maine Section of the American Society of Civil Engineers connected. (ASCE) recently released its second “Report Card for Relocate the Lewiston Steam Substation from Maine’s Infrastructure, assigning the state’s 14 infraMill Street to Middle Street, and upgrade the structure areas reviewed a cumulative grade of C-. A Lewiston Loop transmission and distribution grade of C is considered as mediocre with some risks grid to a 115kV system which will provide of failure and deferred maintenance likely. A rating of
safety, capacity, and redundancy for downtown Lewiston as well as the broader region. Encourage PanAm Railways to improve rail servicei in the State to help support businesses utilizing their services to drive down transportation costs and to minimize unnecessary truck traffic on Maine Roads. Expand passenger rail to Montréal along the Portland to Auburn to Bethel corridor.
Regulation The Administration’s focus on improving the regulatory process over the past two years is a great start toward a fairer regulatory climate. We remain convinced that further improvements in the regulatory process are all about "attitude." What businesses and developers look for are fair, equitable, and timely decisions. At the local level, two actions would be helpful: Establish uniform construction codes for neighboring communities with enforcement staff that work together across municipal boundaries. Revamp rehabilitation standards so that codes for downtown neighborhoods make it more economically feasible to rehabilitate and reuse older buildings.
The Board of Directors gratefully acknowledges the following members of the Chamber’s Business Advocacy Committee for their assistance in preparing this document: Division Co-chairs Peter Traill, Nason Mechanical Systems and Clifton Greim, Harriman Architects & Engineers Mark Adams-- Sebago Technics Inc Dick Albert-- Champoux Insurance Agency Maureen Aubé-- The Chamber Michael Bigos--Berman & Simmons Ryan Booker-- Hahnel Bros Co Art Boulay--Strategic Talent Management Mike Cox-- Central Maine Orthopaedics PA Adam Dunbar-- Wells Fargo Advisors LLC Hillary Dow-- Austin Associates PA CPAs Kate Egeland-- International Paper Auburn Kevin Fletcher--Better Homes and Gardens The Masiello Group Patti Gagne--Patti Gagne Agency, Allstate Insurance Elaine Hemenway-- Payroll Management Inc Jonathan LaBonte—Androscoggin Land Trust Jim Lamson-- L & B Electrical Contractors Inc Paul Landry-- Fish Bones American Grill Ronald Lebel-- Skelton Taintor & Abbott Michael Malloy-- Brann & Isaacson Chip Morrison-- The Chamber Mark Overhaug--Austin Associates PA CPAs Cindy Quinlan-- Clover Health Care Dan Smiley -- Turner Publishing John Snyder-- On the Spot Rental Management Linda Snyder-- ReGroup! Business Solutions Peter Steele-- Twin City Times Robert Thompson-- AVCOG Marlee Turner-- Northern Pines Bed and Breakfast Ralph Wallace-- Trask-Decrow Machinery Inc Jim Wellehan--Lamey Wellehan Shoes Jim Wilkins-- Auburn Public Library Bud Willey-- Canteen Service Co
104 R Rep. Dale
54 Riverside Dr
PO Box 927
75 R Rep. Stephen Wood
Chair, Health and Human Services; Government OverME 04240 sight Committee
ME 04252 Inland Fisheries and Wildlife
Chair, Energy, Utilities and Technology; Labor, Commerce, Research and EcoME 04210 nomic Development
ME 04210 State and Local Government Appropriations and Financial ME 04240 Affairs
Judiciary; Veterans and LeME 04210 gal Affairs
ME 04280 Inland Fisheries and Wildlife
New Gloucester ME 04260 Inland Fisheries and Wildlife Oxford ME 04270 Taxation Livermore Falls ME 04254 Taxation Criminal Justice and Public Lewiston ME 04240 Safety 71 D Rep. Michel Lajoie 783-1927 Rep.Michel.Lajoie@legislature.maine.gov 279 Old Greene Rd 73 D Rep. Nathan Libby 12 Orange St Lewiston ME 04240 Taxation 312 Ridge Rd Lisbon Falls ME 04252 Veterans and Legal Affairs 17 R Sen. Garrett Mason 353-9086 firstname.lastname@example.org Education and Cultural Af27 Pismire Mountain Rd Raymond ME 04071 fairs 103 R Rep. Michael McClellan 655-4438 email@example.com Energy, Utilities and Tech84 Small Rd Litchfield ME 04350 nology 80 R Rep. Mel Newendyke 268-2553 firstname.lastname@example.org 280 Thompsons Point Rd Naples ME 04055 Transportation 101 D Rep. Christine Powers 318-2511 email@example.com Chair, Appropriations and 446 College St Lewiston ME 04240 Financial Affairs 74 D Rep. Margaret Rotundo 784-3259 firstname.lastname@example.org Agriculture, Conservation 284 Ricker Hill Rd Turner ME 04282 and Forestry 96 R Rep. Jeffrey Timberlake 225-6016 email@example.com 70 D Rep. Wayne Werts 783-6931 556 Pownal Rd Auburn ME 04210 Transportation
2 Passing Lane
41 Russell St
183 Davis Avenue
12 Lewiston Rd 50 Hebron Rd 453 Moose Hill Rd
344-3017 RepMichael.Carey@legislature.maine.gov 10 Perrier St
784-0036 RepMike.Beaulieu@legislature.maine.gov 27 Sherman Ave
105 R Rep. Eleanor Espling M. 926-6082 firstname.lastname@example.org 100 R Rep. Roger Jackson 539-4613 email@example.com 81 R Rep. Gary Knight 897-2489 firstname.lastname@example.org
16 D Sen. Margaret Craven
15 D Sen. John
72 D Rep. Micheal Carey
69 D Rep. Brian
68 R Rep. Michael Beaulieu
D P Title
Local Legislative Delegation