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The Maine Legislature wrapped up their business last week ending a fury of activity that started in January. The Legislature heard hundreds of bills and dealt with serious budgetary issues impacting social programs, public infrastructure, and taxes – just to name a few. In the end, Democrats passed a partisan $11.7 billion biennial budget that leaves future services in doubt and little remaining for infrastructure investments. The Legislature also left the building without sending any bonding measures to the voters this November.
The Maine Biennial budget was passed in two parts. The first part was passed in March and was termed a “baseline budget” by the Democrats. The baseline budget, also known as “Part 1”, was passed with no Republican support and was done to avoid a government shutdown. This procedure has become common in Augusta. Republicans claim that the move is done to cut them out of the budget process, Democrats claim that passing the budget early ensures certainty for citizen services.
The ”Part 2” budget was funding for the remaining pieces of the budget that could be handled outside of the budget and not incur a government shut down. One of the large unknowns was how to fill a $130 million gap in MaineCare funding that was needed to pay Maine’s struggling hospitals. Many feared that Democrats would raise income and corporate taxes to cover this gap. In the end the Legislature chose to enact the following taxes to cover the gap and pay for new spending:
The taxes passed in the part 2 budget will go into effect on September 24, 2025.
ABC Maine also testified on many bills throughout the course of the first session of the Legislature dealing specifically with the construction industry. ABC Maine is excited about the passage of two different working groups. One that will analyze regulatory barriers to housing construction and another that will look at the same barriers in factory-made housing.
ABC Maine was part of defeating many bills that would have lead to poor outcomes for our members and their employees. Items like mandated regionally based living wages and increased penalties for labor violations were defeated in the current session.
At the time of this memo there are still a few bills that Governor Mills has not decided on yet that ABC is watching. One of which is LD 1270. This bill would create a new Department of Energy Resources and would raise the Current Governors Energy Office to a cabinet level position. The office is one that was fought for in the past two administrations and is now slated to become law. The new department would be in charge of procurement and would have many duties currently handled by the PUC housed in the new department. Fortunately, the bill has been amended to remove potentially harmful labor language that would have put merit shop contractors at a disadvantage.
As we look forward to next session there are still many bills that were “carried over” to be delt with next January. Bills like contractor licensing, individual and corporate tax increases, and labor concept drafts still loom on the horizon of 2026. ABC Maine will be there to defend the merit shop and fight for fair competition.