Signatures certified; beverage tax repeal headed for ballot

AUGUSTA (Aug 20): A veto of taxes on beer, wine, soda and health insurance passed at the end of the legislative session to fund the state’s subsidized insurance plan known as DirigoChoice will appear on the November ballot after the Secretary of State’s Office on Monday certified 72,432 signatures on a petition calling for the referendum.

The number certified — 17,345 more than the 55,087 needed to get the veto on the ballot — likely means the Secretary of State’s decision won’t be challenged in court.

“I would not anticipate a court challenge,” said Gordon Smith, head of the Maine Medical Association and spokesman for the group opposed to the tax veto. “We’re much better off, given the margin, putting our money into educating Maine voters about what this proposed law really did; why it’s important to keep it; and to begin the fall campaign.”

Newell Augur, spokesman for the successful Fed Up With Taxes veto drive and a lobbyist for the Maine Beverage Association, said his group is also focused on November.

“This clearly reflects how people feel right now, and we’re moving full speed ahead to begin our campaign to urge all Maine people, who are fed up with high taxes, to vote yes on Question 1,” Augur said.

The signature-gathering campaign was funded largely by the beer, wine and soda industry, with help from the Maine Restaurant Association, tourist-related industries, convenience store operators and other businesses. It spent nearly $500,000 to get the needed signatures in the 60 days required by law.

Opponents of the veto spent $86,000 to try to dissuade people from signing, money that largely came from a single out-of-state donor who lives part time in Maine and supports Democratic causes and candidates.

Fundraising for the fall campaign battle is expected to dwarf those amounts.

The taxes passed would raise between $55 and $75 million, depending on whose estimates one believes.

They include a new $4 tax on a gallon of syrup used to make soda in restaurants; a new 42-cent per gallon tax on bottled soft drinks; and a doubling of the current tax on beer and wine, to 54 cents a gallon on beer and 65 cents a gallon on wine.

The package also includes a 1.8 percent tax on claims paid by insurance companies and the self-insured to replace a similar fee that today supports DirigoChoice insurance.

The beer, wine and soda taxes were passed without warning to the beverage industry and without a public hearing in the final days of session to replace a proposed hike in the cigarette tax that didn’t have the votes to pass in the Senate.

While opponents say without the new taxes the DirigoChoice health plan will cease to exist, in reality there is a funding mechanism in place that can be continued for the foreseeable future.

It is an assessment on private health insurance and the self-insured that this year is raising just less than $33 million. Next year’s assessment will be determined in September and collected if the people’s veto prevails at the ballot box.

The problem is the assessment has not raised enough money to grow DirigoChoice, which Gov. John Baldacci pushed through in his first term and has protected as the state’s best chance at insuring the uninsured.

There are currently just more than 12,000 people enrolled in the health plan because of limited funding. The assessment also pays the state’s share of enrolling another 5,000 people in straight-up Medicaid — the federally subsidized insurance plan for the poor.

The Fed Up With Taxes campaign says it’s not against DirigoChoice, but rather the raising of taxes in bad economic times. ”These taxes were passed without a public hearing in the dead of night,” said Augur.

The anti-veto campaign, aligned under the group Health Coverage for Maine, argues the beer, wine and soda industry simply wants to avoid a tax at the expense of health care for Mainers.

“We are certain that when the voters are informed, people aren’t going to trade health-care coverage for Maine people for a few pennies on beer, wine and soda,” Smith said.

Opponents have until 5 p.m. Monday, Aug. 25, to challenge the Secretary of State’s certification of the petition signatures. That challenge would then be heard in Superior Court.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.