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127Th Maine State Legislature - a Year in Review

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127Th Maine State Legislature - a Year in Review 127th Maine State Legislature - A Year in Review Dear MGFPA Member, The Maine Grocers & Food Producers Association is a community dedicated to the prosperity of Maine’s grocery and food producer industry through excellence in advocacy, networking and education. The 127th Legislative Summary – A Year in Review captures the work we do on your behalf at the Statehouse. The return on your investment is estimated to be several million dollars. We are very proud of our work keeping our promise to represent your interests through positive working relationships with the Legislature, the LePage Administration and industry partners. We have a strategic focus targeting issues of the highest importance to the membership and we build coalitions to amplify our message. We thank you for your on- going support and engagement. Successes That Save You Time & Money • Food Safety Regulations Upheld • Organized Retail Crime Classified in Maine law • BETR Program Fully Funded • NO Workers’ Bill of Rights Mandates • Beer, Wine & Spirits Market Share to Expand • Liquor Distribution & Sales Hours Extended • Technology Upgrades at BABLO • Tenant Brewers Gain Opportunities • NO Product Fees or Product Bans • Pharmacists Vaccination Authority Expanded A Year in Review highlights New Laws, Failed and Carry Over proposals. All New Laws become effective on October 15 unless they were “emergency measures” in which case they are now in effect. All Carry Over proposals will be sent back to the Joint Standing Committees for further consideration in January 2016. As always, visit mgfpa.org and click on Legislative Watch for detailed information. Thank you to the many members who engaged in the process through email, calls, testimony and meetings with Governor LePage, administrators and Legislators, and thank you to the members of the MGFPA Government Relations Committee for their outstanding contributions. There is nothing more of value than a business owner telling their story. Currently, we’re engaged in or are monitoring a list of issues and urge you to let us know if something pops up in your community. The deadline for submitting legislative proposals is September 25th. If there are areas of interest, please let me know. • Houlton to consider allowing beer and wine to be sold on Sundays. • Bangor and Augusta are discussing a minimum wage rate increase. • Maine People’s Alliance is gathering signatures for a statewide referendum to increase the state’s minimum wage to $12.00 by 2020. • Freeport, Yarmouth, York, and South Portland are considering fees on paper and plastic check out bags and bans on polystyrene food service containers. • Maine Milk Commission is considering increasing dairy farmer margins which may lead to higher retail milk prices. • Congress is taking a hard look at eligible foods under the SNAP (food stamps) Program. • Congress is considering GMO labeling legislation. • Grocery Manufacturers Association suit against the State of Vermont’s GMO labeling law is pending. I would like to also recognize MGFPA members that serve in the Legislature who were most helpful this session. Senator Amy Volk, Scarborough, Volk Packaging, Representative Jeff Timberlake, Turner, Ricker Hill Farms and Representative Gary Sukeforth, Appleton, The Common Market in Union. If you have a chance to say hello to your State Senator or Representative, please thank them for their service and for their support of your business. As always, please stay engaged by calling the office at 207.622.4461, by email to [email protected], or through the mgfpa.org website. Be well and enjoy the rest of summer, Shelley F. Doak, Executive Director Biennial Budget – July 1, 2015-June 30, 2017 & Tax Reform LD 1019, An Act Making Unified Appropriations and Allocations for the Expenditures of State Government, General Fund and Other Funds and Changing Certain Provisions of the Law Necessary to the Proper Operations of State Government for the Fiscal Years Ending June 30, 2016 and June 30, 2017 The State’s biennial budget took center stage this session as it typically does. But this year the reason wasn’t about how to fill a budget gap (we can all be happy about that), but rather Governor LePage’s ambitious $6.7 billion tax reform proposal that would lower the state’s income tax from 7.9% to 5.75%, lower the corporate rate, conform the estate tax to federal levels, eliminate revenue sharing, and increase and broaden the state sales tax rates. It also called for a number of spending increases; a masterful treasure trove leaving Democrats and moderate Republicans quietly supportive of much of the proposal. Conservative Republicans, on the other hand, expressed their opposition setting up for a long and arduous and often ugly session. The Governor’s proposal recommended spending increases, including keeping the 5.5% sales tax rate, broadening and expanding the sales tax on a very long list of personal services, amusements, and prepared foods (aka the “snack tax”). The list of spending reductions included eliminating retail from the Business Equipment Tax Reimbursement (BETR) Program, municipal revenue sharing saving taxpayers $62.5 million, and tax reform that would gradually eliminate the state income tax and lower corporate taxes. It was crafty and strategic, but it was not to be. The state’s two-year $6.7 billion budget was wrestled away from the Governor by four Legislative leaders who hammered out a smoky-back-room budget proposal in the final days of the session. Over the objection of the Governor, who by hand exercised the line item veto, vetoing some 64 expenditures and then the entire budget, finally passed with a 2/3 majority; the end. The Governor’s push to eliminate the state’s income tax was only slightly met, but at the expense of grocery shoppers who will see an expanded sales tax on prepared foods. This expansion was initiated by the Governor and had cross the aisle support. Maine Revenue Services is expected to issue an updated Sales Tax Bulletin prior to the January 1, 2016 effective date. Below are budget highlights; please note effective dates. Income Tax Reductions • Expands the number of rate brackets and amends when they kick in. For joint returns: • Rate of 5.8% up to $42,100 in taxable income • Rate of 6.75% from $42,100 to $100,000 • Rate of 7.15% (compared to current high rate of 7.95%) above $100,000 • Makes the state EITC refundable • Eliminates state income tax on military pensions Sales Tax • Rate for most goods remains at 5.5% • Rate on meals remains at 8% • Rate on lodging increased to 9% • Rate expanded to include additional prepared foods, remains at 8% Estate Tax Exemption Raised - Effective after January 1, 2016, conforms to federal estate tax level of $5.5 million Homestead Exemption – Increased for all taxpayers from $10,000 to $15,000 for property tax years beginning on April 1, 2016 and to $20,000 for tax year 2017. Refundable Sales Tax Fairness Credit - $125 for individuals and up to $225 for families. Phased out as income increases above $20,000 for individuals and $40,000 for families. BETE/BETR – Fully funded. Businesses participating in the BETR program saw cuts in 2013 and 2014. By fully funding the program, $14 million more is available to our members. Municipal Revenue Sharing & School Funding- Flat funded at $62.5 million per year. GPA is $40 million per year. Page 2 Taxes Carry Over One of the more complex and controversial proposals of the session was LD 1099 to add a $.20 fee on household consumer products, an estimated 10,000 products, to raise funds to support research at the University of Maine. The University’s intention has merit as they begin to develop in-state testing capacity for Lyme disease and other vector borne diseases. In November 2014, voters approved an $8 million bond proposal to fund an Animal and Plant Health & Insect Control Laboratory. With support from both sides of the aisle and an apparent “bye” from the Governor who indicated he wouldn’t veto the bill, retailers headed to their phones and computers to persuade lawmakers to change their minds; find funding in the state’s general fund and vote down the bill. It wasn’t until the very last day of the session that lawmakers, who struggled to find funding, agreed to carry the bill over in hopes of identifying funding to support the University’s research efforts. No one is arguing against the merits of the bill, just how it would be funded. We understand that it might cost the University $300,000 to ramp up its testing capabilities, whereas the $.20 fee is estimated to raise $3 million. We’re extremely concerned about the precedent of taxing products as a means of funding a University of Maine function. The 127th Legislature will tackle the issue in January. • LD 1099, An Act To Establish a Fund for the Operations and Outreach Activities of the University of Maine Cooperative Extension Animal and Plant Disease and Insect Control Laboratory, Representative Russell Black Alcoholic Beverages & Agency Liquor Stores New Laws LD 511 and LD 364 were worked in conjunction but are nuanced in their permission. LD 511 provides that a licensed sales representative may provide spirits for a taste testing a agency liquor store, as long as that product is purchased at the regular retail price from the agency store. Effective immediately, LD 364 permits a licensed sales representative to pour samples of spirits, wine or malt liquor at a taste-testing event at on-premise retail establishments, agency liquor stores or at off- premise retail establishments. • LD 364, An Act To Allow a Sales Representative To Serve Spirits or Wine at a Tasting Event, Representative Richard Malaby, Hancock • LD 511, An Act To Permit a Licensed Sales Representative To Provide Spirits at an Approved Tasting Event, Representative Sara Gideon, Freeport There are 500 agency liquor stores in Maine, and this number may likely increase as lawmakers agreed to allow the Bureau of Alcoholic Beverages and Lottery Operations (BABLO) to issue one additional liquor store license in a municipality with a population of less than 10,000.
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