An Act To Implement the Recommendations of the Commission To Reform the State Budget Process
Maine Legislature, Session 122, LD 2045
Committee: Appropriations and Financial Affairs
Sponsors: ROTUNDO, BRANNIGAN, NASS, MILLETT
Amends: 5 MRSA §1664, 5 MRSA §166, 5 MRSA §1665, 5 MRSA §1666

Legislative Document 
No. 2045 
S.P.790 
In Senate, March 2, 2006 
An Act To Implement the Recommendations of the Commission To 
Reform the State Budget Process 
Reference to the Committee on Appropriations and Financial Affairs suggested and ordered 
printed. 
JOY J. O'BRIEN 
Secretary of the Senate 
Presented by Senator ROTUNDO of Androscoggin. (GOVERNOR'S BILL) 
Cosponsored by Representative BRANNIGAN of Portland and 
Senator: NASS of York, Representative: MILLETT of Waterford. 
Pnnted on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 5 MRSA §1664, as amended by PL 2005, c. 2, Pt. A, §6 
and affected by §14, is repealed and the following enacted in its 
place: 
§I664. 
Form of budget document 
1. 
Form. 
The state budget document. setting forth a 4-year 
financial plan for the State Government for each fiscal year of 
the ensuing biennium and the following biennium. must: 
A. 
Consist of a budget message by the Governor-elect or the 
Governor that outlines the 4-year financial policy of the 
State Government for the ensuing biennium and the following 
biennium. 
describing 
in 
connection 
with 
the 
important 
features of the financial plan: 
B. 
Embrace 
a 
general budget 
summary setting forth the 
aggregate figures of the budget in such a manner as to show 
the 
balanced 
relationship 
between 
the 
total 
proposed 
expenditures and the total anticipated revenues 
together 
with the other means of financing the budget for each fiscal 
year 
of 
the 
ensuing 
biennium. 
contrasted 
with 
the 
corresponding figures for the last completed fiscal year and 
the fiscal year in progress. 
The general budget summary 
I!l.Y.£t...t 
(1) 
Be 
supported 
by 
explanatory 
schedules 
or 
statements. 
classifying 
the 
expenditures 
contained 
therein by organization units. objects and funds and 
the income by organization units. sources and funds: and 
( 2) 
Include a summary and details of programs funded 
through the Fund for a Healthy Maine, presenting the 
allocation 
re~uirements 
and 
projected 
revenues 
and 
other available resources shown in a budget fund flow 
statement and 
a 
comparative statement that presents 
income sources for revenue projections and allocation 
estimates by program categories: 
C. 
Include a financial plan for the following biennium with 
forecasted General Fund. Highway Fund and Fund for a Healthy 
Maine appropriation 
re~uirements and projected revenues by 
income 
sources 
as 
provided 
in chapter 
151-B 
and other 
available reso_urces shown in a budget fund flow statement 
and a comparative statement that presents income sources for 
revenue projections and appropriation estimates by major 
program categories; 
D. 
Specifically describe the estimated loss in revenue 
during the last completed fiscal year and the fiscal year in 
progress, 
and the anticipated loss in revenue for 
each 
fiscal 
year 
of 
the 
ensuing 
biennium, 
caused 
by 
tax 
expenditures provided in Maine statutes. 
For purposes of 
this paragraph, 
"tax expenditures" means those state tax 
revenue losses attributable to provisions of Maine tax laws 
that allow a special exclusion, exemption or deduction or 
provide a special credit. a preferential rate of tax or a 
deferral of tax liability: 
E. 
Contain 
the 
priorj_~ed public 
improvements 
budget 
estimate required by section 1665, subsection 5: 
P. 
Include statements of the bonded indebtedness of the 
State Government showing the debt redemption requirements, 
~ebt authorized and unissued and the condition of the 
sinking funds: and 
G. 
Contain any statements relative to the financial plan 
that the Governor-elect or the Governor considers desirable 
or that may be required by the Legislature. 
2. 
Judicial Department appropriations or allocations. 
If 
the Governor submits legislation setting forth appropriations or 
allocations for the Judicial Department that differ from the full 
budget request submitted by the Judicial Department under Title 
4, section 24, the Governor shall simultaneously submit a report 
to 
the 
joint standing 
committees 
of 
the 
Legislature having 
jurisdiction 
over 
appropriations 
and 
financial 
affairs 
and 
judiciary 
matters 
explaining 
why 
the 
Governor's 
budget 
legislation 
differs 
from 
the 
Judicial 
Department's 
budget 
submission. 
3. 
Office 
of 
Program 
Evaluation 
and 
Government 
AC~Quntability appropriati2ll&.~~~ations. 
If the Governor 
submits legislation setting forth appropriations or allocations 
for 
the 
Office 
of 
Program 
Evaluation 
and 
Government 
Accountability that differ from the budget request presented by 
the Legislative Council on behalf of that office, the Governor 
shall simultaneously submit a report to the Legislative Council 
and 
the 
Office 
of 
Program 
Evaluation 
and 
Government 
Accountability explaining why the Governor's budget legislation 
differs from the Legislative Council's budget request. 
4. 
Position identification. 
The Governor, when submitting 
the budget to the Legislature, shall submit the budget document 
and the budget bills in 
a 
manner that identifies positions 
authorized by the Legislature for less than 52 weeks in a fiscal 
~ar as 
"Positions 
Full-time 
Equivalent," 
or 
"PTE," 
and 
positions authorized by the Legislature for 52 weeks in a fiscal 
year as "Positions -
Legislative Count" for all funds. The State 
Budget Officer shall 
implement 
and 
administer 
procedures 
to 
ensure sufficient FTE and appropriation or allocation control for 
positions authorized by the Legislature for less than 52 weeks in 
a fiscal year. 
5. 
LiDlit on General Fund ilP,Pro.vriation. 
The total General 
Fund appropriation for each fiscal year of the biennium in the 
.G.Qvernor' s budget submission to the Legislature may not exceed 
the General Fund appropriation limitation established in section 
~ 
Sec. 2. 5 MRSA §166S, sub-§l, as amended by PL 2005, c. 2, Pt. 
A, §7 and affected by §14, is further amended to read: 
1. 
Expenditure 
and 
appropriation 
requirements. 
On 
or 
before September 1st of the even-numbered years, all departments 
and other agencies of the State Government and corporations and 
associations receiving or desiring to receive state funds under 
the provisions of law shall prepare, in the manner prescribed by 
aBe-~-:ela&lf.s--.foQ-£fi.,i5hee--t-herA--By the State Budget Officer, and 
submit 
to 
the 
officer 
estimates 
of 
their 
expenditure 
and 
appropriation requirements for each fiscal year of the ensuing 
biennium 
eeB~~as~ee-~it~-~he-~~~~&4~~-.f~~~-e~-~~-las~ 
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fiseal--yeaF. 
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ehaJl~e-.,ifi-~~~-~~-iB-~~~~~~-~eF-a-~~--~rr-as 
es~iffia~ee-&y-~~~it~-S&a&es-gepaF~~eB~-~-~~r-S~~a~-et 
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±JleeH-.f~--&htt~-ealeBQa~-~,--~~-p~F~eses-~--t~~-sQBseetieJl T 
!!b9JlSQ~e ~ - ...p.~iGe- - .,I-ndeK-!'- - has- -~a& --&ame- - ffi9afi.,ifi~--as - -i-n- - !I'~-t.~-e- - ~ e T 
seetie&-~7--~io-n--l... 
The expenditure estimates must be 
classified to set forth the data by funds, organization units, 
character and objects of expenditure. The organization units may 
be subclassified by functions and activities, or in any other 
manner, at the discretion of the State Budget Officer. 
All 
departments 
and other 
agencies 
receiving or desiring to 
receive state funds from the Highway Fund shall submit to the 
officer 
estimates 
of 
their 
expenditure 
and 
appropriation 
requirements for each fiscal year of the ensuing biennium that do 
not exceed the Highway Fund appropriation of the previous fiscal 
year multiplied by one plus the average real personal income 
growth rate or 
2.75%, 
whichever is less. 
The 
Highway 
Fund 
highway and bridge improvement accounts are exempt from this 
spending limitation. 
Sec. 3. 5 MRSA §1665, sub-§2, as corrected by RR 2003, c. 2, 
§6, is repealed. 
Sec. 4. 5 MRSA §1666, as amended by PL 2005, c. 457, Pte GGG, 
§l, is further amended to read: 
S1666. Review and revision of estimates 
The Governor-elect or the Governor, with the assistance of 
the State Budget Officer, shall review the budget estimates, 
altering, 
rev~s~ng, increasing or decreasing the items of the 
estimates as may be determined necessary in view of the needs of 
the various departments and agencies and the total anticipated 
income of the State Government during the ensuing biennium. 
This 
review must cover all budgets regardless of source of funds, 
including, but not limited to, budgets related to the Highway 
Fund, the Federal Revenue Sharing Fund and other special revenue 
funds. 
The 
State 
Budget Officer, 
at 
the 
direction of 
the 
Governor-elect or the Governor shall then prepare a state budget 
document in the form required by law. 
The Governor-elect or the 
Governor is fully responsible for all budgetary recommendations 
made to the Legislature. 
The Governor shall transmit the budget 
document to the Legislature not later than the Friday following 
the first Monday in January of the first regular legislative 
session. 
At that time the Governor shall also transmit aay 
9ieaaial---9~e~e~---9ills---~aa~---a~~aeFiBe---appFepFia~ieas---eF 
alleea~ieas-~~~~-~peemia~-~~~~~-~ae-Ge¥e£~-~-wisa 
~e--p~~~-~-~~~--as any 
emergency bills 
that 
authorize 
additional appropriations or allocations in the current fiscal 
year that the Governor may wish to propose. 
A Governor-elect 
elected to a first term of office shall transmit the budget 
document to the Legislature not later than the Friday following 
the first Monday in February of the first regular legislative 
session. 
At that time the Governor-elect shall also transmit aay 
9ieHaial---9~g~e~---9ills---~aa~---a~~aeFiBe---appFepFia~ieas---eF 
alleea~ieas-~~~~-~peemia~-~~~~~-~ae-~~-~-wisa 
~e--pFepese--as--well--as any 
emergency 
bills 
that 
authorize 
additional appropriations or allocations in the current fiscal 
year that the Governor may wish to propose. 
The Governor, when submitting the budget to the Legislature, 
shall submit the budget document and the General Fund and Highwa~· 
Fund bills in a 
manner that identifies the gross 
amount of 
resources for each program. The gross unified budget bills an,l 
budget 
document 
encompass 
resources 
from 
the 
General 
Fund 
Highway 
Fund, 
Federal Expenditures 
Fund, 
Federal 
Block Grant 
Fund, Other Special Revenue Funds, internal service funds and 
enterprise funds. Separate gross unified budget bills must be 
submitted for the General Fund and the Highway Fund. 
All funds 
except trust and agency funds, bond funds and costs of goods sold 
expenditures in internal service funds and enterprise funds are 
subject to legislative allocation. All programs with Highway Fund 
allocations and all internal service funds, enterprise funds and 
Other 
Special 
Revenue 
Funds 
accounts 
of 
the 
Department 
of 
Transportation are subject to legislative allocations and are 
presented for informational purposes only in the budget document 
grul General Fund budget bills unless a 
separate Highway Fund 
budget is not enacted. 
A 9~eRR~al budget 9~11 document transmitted by the Governor 
or Governor-elect must include a part that asks the Legislature 
whether it wishes 
to 
continue 
funding 
each 
individual 
tax 
expenditure, 
as 
defined 
in 
section 
1664, 
provided 
in 
the 
statutes. 
The part must include for each tax expenditure a 
statutory section reference, 
a brief description of each tax 
expenditure and the loss of revenue estimated to be incurred by 
funding source and fiscal year. 
This paragraph applies with 
respect to the preparation of the budget document aR9-.£H.eBBial 
9Y9~e~-9~lls for the 1998-1999 2008-2009 biennium and thereafter. 
SUMMARY 
This bill implements the statutory recommendations of the 
Commission to Reform the State Budget Process. 
The purpose of 
these changes is to create a budget document that is more useful 
throughout the budget deliberations of the Legislature and to 
adjust the statutes to reflect the recommended change in the 
budgeting methodology. 
This bill shifts the starting point for the biennial budget 
from 
the 
traditional 
current 
services 
model 
to 
a 
modified 
flat-funded 
model. 
Instead of 
building 
from 
prior 
biennium 
requests 
increased 
by 
an 
inflation 
factor, 
requests 
for 
appropriations and allocations start from authorized positions 
and 
flat-funded 
nonpersonal 
services 
appropriations 
and 
allocations. 
Increases from those flat-funded amounts would need 
to be justified and the initiatives presented in the unified 
budget bill. 
This bill eliminates some recently enacted restrictions on 
departmental 
budget 
requests, 
which 
are 
replaced 
by 
the 
/48 
flat-funded restrictions. 
It also provides more flexibility in 
the Governor's budget document. 
This 
bill 
also 
changes 
submission 
of a budget bill and 
the budget document, which will 
2008-2009 
biennium to mirror 
approved by the commission. 
references 
to 
the 
Governor's 
replaces them with references to 
be reformatted beginning in the 
the 
new budget document 
format