Bonds Bonds Bonds Bonds

Last year, Democrats and Republicans were unable to reach an agreement on a series of bonds to finance road and bridge repairs, student debt relief and research and development. Negotiations came to a stalemate after Republican lawmakers announced that they would only support a $105 million transportation bond, while Gov. Paul LePage shockingly sided with Democrats on the need for more spending. A student debt relief bond and a research and development bond received majority support of the Legislature, but they failed to garner the two-thirds support necessary to be sent to the voters for approval. Nevertheless, LePage isn’t giving up on his crusade to get Republicans to support more borrowing.

In making his case for the student debt bond, LePage noted that Maine college graduates have some of the highest debt loads in the country and the highest loan payment delinquency rate in the Northeast.

“For our state to continue to grow, it must become easier for graduates to stay in Maine, and we must attract talented young people here,” said the governor in his weekly radio address. “Not only will these young people work in our industries, but they will also buy homes, invigorate our communities and have children. We can invest in our young people by relieving the burden of student debt for those who want to stay in Maine or choose to relocate here and start their professional careers.”

LePage said he will be submitting a bill that would provide businesses with a tax credit for every student loan payment they make for their employees. On January 11, the Legislature’s Appropriations Committee will also be hearing Le-Page’s $10 million proposal (LD 1614) to create a new program to provide loans of up to $7,500 a year for students pursuing undergraduate and graduate degrees in science, computer science, technology, engineering and mathematics.

On January 9, the committee will also hear LePage’s $2.4 million bond proposal (LD 1511) to upgrade Department of Marine Resources facilities. The measure would provide funds for energy-efficiency improvements, facility upgrades, a new roof and a parking lot expansion at the DMR lab in Boothbay Harbor. The rest of the money would support improvements at DMR’s lab in Lamoine, as well as the replacement of a sampling vessel and the purchase of a $600,000 marine patrol vessel to patrol the lobster fisheries.

More Biomass Subsidies

A year and a half ago, Gov. LePage and the Legislature delivered a $13.4 million taxpayer-funded bailout to the state’s ailing wood-to-electricity industry. This year, the Legislature will consider throwing another $45 million down the stacks, with a pair of bond proposals aimed at helping the biomass industry become profitable again.

Biomass electricity generators have struggled to stay in business due to low wholesale electricity prices as a result of low fossil-fuel prices, a low Canadian dollar, and new laws in Massachusetts and Connecticut that place stricter efficiency standards on biomass plants. Proponents of the bailout said it would help prevent the loss of 400 biomass plant jobs and 900 indirect jobs while biomass companies figure out a way to operate without taxpayer money. 

In November, the French-owned company Stored Solar, hich recently purchased two idled biomass plants in West Enfield and Jonesboro, also received a $500,000 state-backed loan from the Maine Rural Development Authority to build shrimp farms on its West Enfield property. The company has also expressed intent to build a biorefinery in East Millinocket. But despite the subsidies, Stored Solar has struggled to pay loggers for biomass deliveries, according to various news reports. As the Quoddy Times reported last month, Stored Solar still owes loggers about $400,000, down from its $600,000 outstanding debt in August.

Meanwhile, ReEnergy Holdings — which owns biomass plants in Ashland, Fort Fairfield, Stratton and Livermore Falls — has put out a request for proposals from companies looking to co-locate near the plants to take advantage of the energy they produce. According to a ReEnergy press release, each of its facilities is capable of operating as a combined heat and power platform and is located adjacent to undeveloped lands available for lease or sale. The company says that the plants can provide low-cost thermal energy, such as steam and hot water, as well as electricity and CO2 to industries that choose to locate there. And a current proposal in the Legislature could help them get closer to that goal.

On January 10, the Appropriations Committee will hold a public hearing on a $25 million bond (LD 897) that would be used to construct steam piping from stand-alone biomass generators to adjacent manufacturing facilities and to construct biomass combined heat-and-power generation boilers for sawmill manufacturing facilities. The borrowing proposal, which is sponsored by Sen. David Woodsome (R-York Cty.), would also provide funding to convert fossil fuel boilers in public buildings and commercial facilities to biomass boilers.

Also on January 10, the committee will hear LD 953, sponsored by Sen. Troy Jackson (D-Aroostook Cty.), which would borrow $20 million to establish a revolving loan fund administered by the Public Utilities Commission that would provide capital investment in biomass generators or “similar facilities.” On January 9, the Energy, Utilities and Technology Committee will also hear Gov. LePage’s proposal (LD 1632) that would allow biomass plants to enter into long-term power contracts as long as they create a certain number of jobs.

Economic Development, Infrastructure & Water

The Appropriations Committee will also be busy with several other bond proposals. On January 9, the committee will hear LD 178, sponsored by Rep. Russell Black (R-Wilton), which would provide $5 million to correct downstream pollution issues and improve stormwater management. Sen. Susan Deschambault’s (D-York Cty.) bond (LD 319) would create a $25 million grant program to invest in riverfront projects that “contribute to economic, environmental and community development and revitalization [and] promote economic activity.” Both Rep. Erin Herbig (D-Belfast) and Deschambault will present bond proposals to recapitalize a fund to provide grants and loans to municipalities for public facilities and infrastructure.

Also on January 9, House Republican Leader Ken Fredette (R-Newport) will introduce LD 1510, which would borrow $50 million to replace malfunctioning septic systems as well as fund wastewater treatment facility planning, construction grants and hydrographic modeling in coastal watersheds. The committee will also hear LD 1602, sponsored by Rep. Don Marean (R-Hollis), which would borrow $3.15 million to be used for sustainable agricultural water sources and irrigation system development and renovations to the State of Maine Building at the Eastern States Exposition in Springfield, Massachusetts. Known as the “Big E,” the Eastern States Exposition is a nonprofit dedicated to promoting New England agriculture. Built in 1925, the State of Maine Building features local food products as well as tourism information.

Fisheries, Broadband, Local Food & Other Bonds

On January 10, the Appropriations Committee will hold a public hearing on Rep. Walter Kumiega’s (D-Deer Isle) proposed $5 million bond (LD 416) to purchase federal groundfish permits for Maine fishermen. The measure would direct the state to retain revenue from leasing the quota of federal Northeast multispecies groundfish permits to cover the cost of administering the permit program.

The issue of groundfish permits has been a hot topic following the conviction of New Bedford fishing kingpin Carlos Rafael, known as the “Codfather,” for tax evasion and illegally manipulating fishing quotas by mislabeling cod as less valuable fish. In a recent editorial, the Boston Globe noted that the scheme particularly hurt groundfishermen like Randy Cushman of Port Clyde, who paid $49,000 for his fishing quota for American plaice (known as “dabs”) that ran out after four days on the water. The Globe reported that Rafael directed his crew to report dabs as other kinds of fish that have higher limits to avoid paying the higher quota prices that fishermen like Cushman paid. The practice depressed prices as a result of blackmarket fish flooding the market and skewed the data regulators used to set quotas. The scandal has led to a contentious debate in the fishing industry over whether Rafael’s permits should stay in New Beford or be redistributed to other places like Maine.

“The bond bill is a revival of something that we tried in the 126th [Legislature], so it’s not directly related to the Codfather,” said Kumiega. “However this is a great time to get it done. Those permits will change the fishery when they come out.”

Rep. Mick Devin will also present a $5 million bond to support improvements to sea level prediction models by providing more detailed mapping of coastal zones and monitoring sea level changes in order to help prepare for rising sea levels. Rep. Craig Hickman (D-Winthrop) will introduce his $20 million bond for food processing infrastructure to support local agriculture. The committee will also hear LD 520, sponsored by Rep. Seth Berry (D-Bowdoinham), which would borrow $100 million to provide broadband Internet service to underserved areas of the state.

Also on January 10, the committee will consider LD 345, sponsored by Sen. Roger Katz (R-Kennebec Cty.), which would borrow $6.1 million to replace Maine Public Broadcasting Corporation’s systems that carry the emergency alert system. And Sen. Tom Saviello (R-Franklin Cty.) will present a $6 million bond to provide grants to communities to create digital parcel maps to “accurately identify existing boundaries and land use, identify potential community development areas and protect environmental resources.”

Another Senior Housing Bond

For years, Gov. Paul LePage and House Republicans have blocked the release of a $15 million voter-approved bond to build housing for low-income seniors. If LePage ever releases the bonds, the money would be used in combination with $22.5 million in matching funds from other sources to build roughly 225 housing units in towns across the state.

On January 10, Sen. Amy Volk (R-Cumberland Cty.) will present another $50 million bond to create senior housing to the Appropriations Committee. Under the proposal, at least one of the facilities would be located in each of the 16 counties in the state, with preference given to locations that have access to health care and other essential services. The bond would be leveraged with $75 million in private and other funds. There are approximately 9,000 senior households on waiting lists for affordable housing in Maine.

Education Bonds

On January 11, the Appropriations Committee will hear a number of borrowing proposals to support educational institutions in the state. Sen. Bill Diamond (D-Cumberland Cty.) will present an $80 million bond (LD 376) to construct an engineering design and education center at University of Maine Orono. The university is in the process of planning to build the center to help meet Maine’s engineering workforce needs and address increased enrollment demands for UMaine’s popular engineering programs, according to a press release. The Legislature has so far provided $50 million in debt service for the new building, while UMaine is putting up $5 million. The university still needs to raise another $30 million for the center, which it is scheduled to break ground on in late 2019 or early 2020.

LD 47, sponsored by Rep. Ryan Fecteau (D-Biddeford), would borrow $40 million to be used for capital improvements and equipment for high school career and technical education centers. Sen. Brian Langley (R-Hancock Cty.) will introduce LD 1562, which would borrow $10 million for career and technical schools. The committee will also hear Rep. Phyllis Ginzler’s (R-Bridgton) bond (LD 1330) that would provide $20 million for consolidated pre-kindergarten through 16 schools. Ginzler will also present LD 1331, which would provide $20 million to fund renovation and capital repairs to public schools.

Overworked Nurses, Criminal History & Autocycles

On January 9, Senate Majority Leader Garret Mason (R-Androscoggin Cty.) will head to the Health and Human Services Committee to present LD 898, which would prohibit hospitals from requiring nurses to work more than 12 hours in a 24-hour period. The bill would provide exceptions for physicians and in case of emergency.

According to a 2014 survey of registered nurses by Vickie Milazzo Institute, a Texas-based nurse consulting firm, 64 percent of respondents said they rarely get seven to eight hours of sleep per night, while another 31 percent said they only get enough sleep two to three nights a week. A 2013 study by the Association of Rehabilitation Nurses concluded that long work hours not only pose a health risk to employees, but also reduce job performance and can even lead to errors that harm patients.

Also on January 9, Sen. Dave Miramant (D-Knox Cty.) will present to the Transportation Committee his bill (LD 1750) to allow people to drive autocycles with a driver’s license. Autocyles are fuel-efficient, three-wheeled enclosed vehicles that operate like a car but currently require a motorcycle license in Maine. 

Over in the Judiciary Committee, Rep. Patrick Corey (R-Windham) will introduce LD 1658, which would make all criminal record information in the Department of Public Safety’s database confidential. Under current law, most criminal history records are public and are available to anyone to access.

Cracking Down on Medical Marijuana

As Democratic lawmakers wrestle with LePage over how to craft new rules for the sale of adult-use marijuana, the state’s medical program will also likely be dragged into the fray. Currently, small individual growers known as caregivers may provide medical marijuana for up to five qualifying patients at a time. In addition to licensing fees, there is a 5.5-percent sales tax on medical marijuana.

However, following passage of the 2016 referendum to legalize recreational marijuana, Gov. Paul LePage has often questioned the need for having a medical program at all anymore.

“If you’ve got recreational marijuana [and] it’s over the counter, why do we need medical marijuana?” said LePage in a radio appearance in December 2016. “…You don’t need a prescription to buy Bayer aspirin, so why do you need a prescription to buy recreational marijuana or medical marijuana?”

In his veto letter of a bill to allow retail marijuana stores and bars, the governor argued that the bill didn’t apply the same regulations on the state’s existing medicinal program, which he said has weaker regulations and a lower tax rate. He said he also opposed the bill because it would create “a bifurcated regulatory structure with two Executive Branch departments regulating the market,” which would cause “unnecessary additional administrative costs and confusion.” He added that the two programs should be “considered together” to prevent recreational growers from taking advantage of the lower taxes on medicinal pot.

The Health and Human Services Committee will take up several measures to revise the state’s medical marijuana program on January 10. Rep. Paul Chace (R-Durham), a pharmacist and pharmacy consultant, will present a bill that aims to crack down on caregivers with heavier regulations and restrictions. His bill LD 1135 would make it a Class D crime, punishable by up to $2,000 in fines and a year in prison, for six or more caregivers to grow pot on the same parcel of land. The measure would also prohibit caregivers from having more than five patients in a calendar year and would allow municipalities to limit the number of caregivers in a town. Chace’s proposal would also require caregivers to disclose information in their license applications to town officials and law enforcement and would create a series of fines for failing to register as a caregiver or dispensary. In addition, the bill would allow the Attorney General to seek an injunction against marijuana caregivers who fail to register and allow the District Court to order caregivers to pay the costs of the investigation and attorney’s fees.

LD 1527, sponsored by Rep. Anne Perry (D-Calais), would impose new testing, labeling and recordkeeping requirements for caregivers and make them subject to inspection by the Department of Health and Human Services to ensure regulatory compliance. It would also subject caregivers to inspection by local fire departments and code enforcement officers. LD 1527 would also require mandatory testing of all medical marijuana products and impose a 20-percent tax on retail marijuana sold at stores and social clubs.

Allowing Patients to Possess Up to 8 Pounds of Pot

On the side of the caregivers, Rep. Deb Sanderson (R-Chelsea) has submitted a handful of bills to liberalize medical marijuana laws. Her bill LD 1539 would allow physicians to recommend medical marijuana for any medical condition that the physician believes may be alleviated by the patient’s using marijuana for medical use. However, it would also require patients to consult with at least three medical professionals first. The legislation would increase the limit of marijuana that a qualifying patient may receive in a 15-day period from 21⁄2 ounces to 8 pounds. LD 1539 would also increase the number of employees a caregiver can have and allows caregivers to transfer pot to each other, among several other provisions.

Sanderson has also sponsored LD 762, which would dedicate a percentage of the fees derived from medical marijuana licenses to create a special fund to provide grants for research into medical marijuana. Sanderson will also present LD 1098, which would allow caregivers serving children to administer marijuana to the child on school grounds. According to finance reports, 75 percent of the funding for Sanderson’s last election campaign came from marijuana growers.

The HHS Committee will also hear Sen. Eric Brakey’s (R-Androscoggin Cty.) proposal (LD 411) to allow physicians to recommend marijuana to treat opiate addition. A recent study published in the journal Drug and Alcohol Dependence found that in states that have legalized marijuana, hospitals did not see an increase in pot users, but did end up treating far fewer opiate users.

Colonial Pemaquid, In-State Tuition & Suicide

On January 9, the Agriculture, Conservation and Forestry Committee will hear Sen. Dana Dow’s (R-Lincoln Cty.) bill to direct the state to lease operations of Colonial Pemaquid Historic Park in Bristol to the private nonprofit Friends of Colonial Pemaquid. The lease agreement would require that the property and historical collections be used exclusively for historic preservation and public education purposes.

The next day, the Education Committee will hear Sen. Dave Miramant’s (D-Knox Cty.) bill (LD 1749) to allow students who have been a Maine resident for just one year, rather than the current two years, to qualify for in-state tuition at state universities. The same day, Rep. Jared Golden (D-Lewiston) will present LD 1694, which would require the state to adopt protocols for schools designed to prevent youth suicide. According to the Centers for Disease Control and Prevention, suicide was the second leading cause of death among young people aged 10 to 24 and adults aged 25 to 34 from 2012 to 2014. Maine’s youth suicide rate is above the national average.

Maine’s Bicentennial Bill

Also on January 10, the Education Committee will hear LD 1696, sponsored by Rep. Gary Hilliard (R-Belgrade), which would appropriate $75,000 to fund the Maine Bicentennial Commission in planning for Maine’s bicentennial celebration in 2020. Maine became the twenty-third state on March 15, 1820, as part of the Missouri Compromise that allowed Missouri to be a slave state and Maine to be free. According to University of Maine history professor Liam Riordan, the movement for the District of Maine to separate from Massachusetts began in 1785, and six popular referendums for statehood were held between 1792 and 1819.

“Lack of military support from Massachusetts for the District in the War of 1812, especially during the British occupation of downeast Maine in summer/fall 1814, revitalized the separation cause,” wrote Riordan on the bicentennial website. “The final campaigns for independence from 1816-19 were championed by Republican party leaders and their newspaper the Eastern Argus.”

In the final vote, Thomaston, which included present-day Rockland, as well as the towns of Belfast, Belmont, Camden, Hope, Appleton, Searsmont, Cushing, St. George, Nobleboro, Wiscasset and Ballstown (Whitefield), voted for Maine to became a state. Ducktrap (Lincolnville), Northport, Union, Waldoboro, Warren, Vinalhaven and Newcastle voted to stick with Massachusetts.

Another Solar Bill

Recently, Maine’s Public Utilities Commission announced that it will delay implementation of a new rule that would reduce the compensation solar users receive from utilities for the power they produce until April. One of the most controversial provisions in the new rules would require solar producers to install new meters to measure the total output of the grid-tied solar photovoltaic systems. CMP has stated in PUC filings that it will cost $300,000 to comply with the rule and suggested that solar customers pay for it, which solar installers strongly oppose.

Currently, Maine’s net energy billing (NEB) rule allows homeowners and businesses with grid-tied solar panels to receive a credit, valued the same as the standard retail rate, for any excess power that they send to the grid. They can then save those credits for up to a year and redeem them for power from the grid when the sun isn’t shining. Under the new PUC rules, existing solar power producers would be compensated at the full retail rate for 15 years, but anyone who installs solar from 2018 on would see their credits gradually reduced over time. The Legislature has tried repeatedly to amend the rules to preserve net metering incentives, but has so far been unsuccessful.

On January 11, the Energy Utilities and Technology Committee will consider LD 1686, sponsored by Sen. Tom Saviello (R-Franklin Cty.), which would prohibit utilities from requiring customers to meter the gross output in order to participate in the net energy billing program. The bill would also require that solar producers who sign up for net energy billing after April 30 be credited for 90 percent of the excess energy they generate, then 80 percent the following year and 70 percent the year after that. Then in each subsequent year after 2021, the percentage of the customers’ excess energy generation that applies to their electric bills may not be reduced more than 10 percent. Net energy billing customers who apply before April 2018 would still receive the credits at the full retail rate until 2033 under Saviello’s bill. LD 1686 would also increase the number of meters that can be on a cooperative solar array or “solar farm” from 10 to 50 meters. Finally, the measure would require the PUC to do a cost-benefit analysis of net energy billing compared to its own proposed recommendations.

Pine Tree Development Zones

The Labor, Commerce and Economic Development Committee will take up a measure to extend a controversial tax subsidy program for businesses on January 11. The proposal comes as the $12 million Pine Tree Development Zone business tax subsidy program has come under increasing scrutiny for its lack of accountability and transparency. The Legislature’s nonpartisan Office of Program Evaluation and Government Accountability (OPEGA) reported last fall that it has been unable to determine whether the subsidies are stimulating job creation, reaching the intended beneficiaries, or if the businesses would have opened or expanded without financial support from taxpayers. 

The program provides subsidies to qualifying businesses, including expanded tax increment financing (TIF) reimbursements, insurance premium tax credits, income tax credits, sales tax exemptions and sales tax reimbursements. It also provides discounted utility rates, electricity sales benefits, and energy conservation incentives. In total, OPEGA estimates the program costs the state about $12 million per year. 202 business are certified under the program, and 146 received benefits in 2015, according to the report. 

In the most economically challenged Tier 1 zones, which include everywhere except certain parts of York and Cumberland counties, certain businesses are eligible to receive benefits for up to 10 years. Tier 2 locations, which include the municipalities in Cumberland and York counties that are not already in Tier 1, may only receive the benefits for five years. The program stopped taking Tier 2 applications in 2013 and is scheduled to cease accepting applications for Tier 1 locations at the end of this year. All PTDZs will cease paying subsidies in 2028. LD 1654, sponsored by Senate Democratic Leader Troy Jackson (D-Aroostook Cty.), would extend the end date of the PTDZ program for another five years.