When I swore in the 128th Legislature this week, I urged them to reduce the negative impact of two referendum questions that will cause significant harm to our economy.

Dear Maine Taxpayer,

All elected officials must respect the will of the people. However, the Legislature’s first duty as elected representatives is to do no harm to our state.

Two questions will cause significant harm to our economy. They will hurt restaurant workers, small businesses, successful people and particularly our elderly. They will drive away doctors, dentists, scientists, engineers and other much-needed professionals.

Question 2 hikes the income tax by 42% on successful Mainers, supposedly to boost funding for education. But it will punish high-earners by slapping them with the second-highest income tax in the nation. It will drive them out of our state. We already have examples of this.

These folks already pay the most in taxes. If they leave and take their income with them, it will result in even less money for education and less revenue from property tax, sales tax and excise tax.

Question 4 raises the minimum wage too fast for local businesses to absorb. Combined with the higher income tax, small business owners will face a financial death spiral. They will first get hit with a 10.15% income tax, then they will have to pay a significantly higher minimum wage.

On top of that, the minimum wage will automatically go up every year, based on the Consumer Price Index. Even during an economic downturn, small business owners would be required to raise wages.

Your friends and neighbors who own small businesses may close up shop and go to New Hampshire or another state with low or no income taxes. Then their employees will be out of a job, and the state will lose their tax revenue, too.

We must slow down the rate of increase to the minimum wage, and we must not eliminate the tip credit so restaurant workers can continue making $25 to $30 an hour.

But those who will get hurt the worst are the elderly. 5,900 Mainers who now earn minimum wage will get a $4-an-hour increase, but 325,000 Mainers won’t get a raise. Those on Social Security will get an average increase of just $4 a month.

As labor costs rise so fast, small businesses will have to lay off workers and raise prices. The elderly will be left out in the cold. They will have to spend more of their fixed income on higher prices on everything they buy. This will push them even deeper into poverty.

I have asked the Legislature to delay implementation of these bills so we can work together to improve them. We can respect the will of the voters, but we must do no harm to our economy, our small businesses and, most importantly, our elderly.

Thank You,

Paul R. LePage

Governor