Report: Maine Taxation Committee Public Hearing on Corporate Welfare bill

The hearing room in the state house was packed yesterday with the vast majority of the people there to oppose LD 1781 – the $60 million in corporate welfare for General Dynamics (GD).  The bill was introduced by the two sponsors, both Democrats, Rep. Jennifer DeChant (Bath) and Sen. Eloise Vitelli (Arrowsic). 

Following those preliminaries BIW V-P and lawyer John Fitzgerald took the podium and began a long-winded sorrowful testimony on the trials and tribulations of the shipyard staying competitive; securing contracts; and barely scraping by in this hard cruel world.  Once the Taxation Committee members began asking him questions he did his best to hem and haw without giving direct answers.

In particular he:

• Refused to commit to reporting to the state how the money was spent if the bill is past

• Refused to commit to job increases at the shipyard if the $60 million was granted

• Refused to answer any question about GD stock buy backs ($12.9 billion since 2009)

• Refused to give any information about GD’s real need for the requested corporate welfare

But LD 1781 was actually the second item on the Taxation Comm. agenda yesterday.  The first bill was requesting more money for the Department of Transportation to fix roads, bridges, rails and ports.  The state has a $60 million shortfall at the DOT.  Currently 33% of bridges in Maine are in deficient condition.  Even the Truckers Association supported an increase in gas taxes if the terrible roads in northern Maine could be repaired.  The testimony on this bill really set the mood for LD 1781 that followed.

Only one person from any BIW unions spoke (a V-P from Local 7, the smallest union at the shipyard).  Those in the know later commented that it appeared to all that the unions (there are several at the shipyard) had made their ‘required’ testimony in favor of the bill but had done it half-heartedly.  There is no love for GD by the workers at BIW who got screwed in their last contract.  One BIW worker wrote on the Facebook page post that I have recently been boosting, “We had to give back $15,000 in benefits in the last negotiations” with GD.

So that was it for the pro-LD 1781 forces.  A couple bill sponsors, the BIW lawyer, one Chamber of Commerce exec and one union V-P from the smallest union.  Everyone else who spoke was opposed.

The first speaker was a woman from Presque Isle who said, “The more profits the military industrial complex makes, the more unstable the world becomes.  GD does not need this subsidy.”

The person who stole the show was the second speaker.  He worked for BIW for seven years as the Director of Taxes at the shipyard.  He opposed the bill.  He made some very important points such as:

• There needs to be a mechanism to audit BIW/GD’s claim of need and if passed there must be annual audits to see how they spent the funds

• Maine currently does not audit any such ‘subsides’ to corporations given in the state

• When BIW pays state taxes GD writes that off in their contracts with the Navy to build ships – (that raised some eyebrows on the committee and in the audience)

• If passed the amount of years giving tax credits to GD should be reduced from 20 years to five

• The credit should be eliminated in any year that employment drops below 4,000 workers.

Then a long string of other speakers (all opposed) made many excellent points.  Here are some of them:

• There is no transparency currently from BIW/GD about their need

• The state has no evaluation process written into LD 1781

• We’ve heard for the last 20 years that BIW might have to leave if they don’t get support from Maine.  Why doesn’t the state have a Plan B to convert the shipyard if they did leave?

• Companies get hooked on these corporate give-a-ways

• GD should open their books and show their financial need

• Corporate welfare is hurting our country

• What is the cost to our souls to keep building warships in our state?

• Corporate stock buy backs are a primary reason for reduced wages and US economic decline

• Kill the bill – don’t amend it and don’t compromise

• A recent Fortune Magazine article had a telling quote from a GD consultant that read:  “Boeing makes planes; Raytheon makes missiles; General Dynamics makes money.”

• Currently we are hearing that GD is telling Maine state legislators that they need more money to train young workers.  It should be stated that the federal contract GD signs with the Navy to build ships at BIW covers all their costs: workers’ pay, materials, equipment, corporate profits and the training of the workforce

• We keep hearing about competition from the Mississippi shipyard.  The Navy wants two shipyards – if a hurricane hit Mississippi they’d want BIW still working

• Manufacturing sector in America will do very well in the new Trump federal tax bill.  GD does not need our support

• Why should a poor state like Maine have to subsidize military production?

• GD always plays the fear card

• Our economy is a war economy

There were three newspapers represented in the hearing and MPBN listened to the live feed and gave limited coverage to the hearing.  See below for a couple of links to initial hearing coverage.

The next step will be a Taxation Committee Work Session (note date change) on Thursday, Feb 8 at 1:00 pm in State House Room 127.  The public is invited to attend but not allowed to speak unless called upon.
 
Our strategy on LD 1781 is to continue to alert the public to this corporate welfare bill so that Mainers can contact their state elected officials urging them to vote it down.  In order to do that we must keep the letters and Op-Eds flowing into daily and weekly papers across the state.  Even if you’ve already written a letter – please write another and get others to write one as well.  So far there have been at least 35 pieces printed in 14 papers.

One state representative from West Bath was in the hearing room yesterday to listen.  She told one person in our group that she has been getting a lot of calls and that ‘people are against this bill’. 

I think our collective efforts on LD 1781 has moved the lever from 'full speed ahead' to 'drop the anchor and hold position’....If we all do our bit we can defeat this bill or at the least dramatically reduce the amount of money that is put into it.  Don’t we all recognize the urgent human and infrastructure needs in Maine that would go unfunded if this bill is passed?

Bruce

https://www.pressherald.com/2018/01/30/proposed-60-million-tax-credits-for-biw-draws-supporters-and-critics/comments/

http://mainepublic.org/post/bath-iron-works-seeks-20-year-60-million-tax-break#stream/0


This campaign is supported by:

Americans Who Tell the Truth (Brooksville)
COAST (Citizens Opposing Active Sonar Threats, Hancock)
Global Network Against Weapons & Nuclear Power in Space (Bath)
Greater Brunswick PeaceWorks
Green Horizon Magazine (Topsham)
Island Peace & Justice (Deer Isle)
Maine Green Independent Party
Maine Natural Guard (Solon)
Maine Veterans For Peace
Maine War Tax Resistance Resource Center (Portland)
Maine Women’s International League for Peace & Freedom (Brunswick)
Peace Action Maine (Portland)
Peace & Justice Center of Eastern Maine (Bangor)
Peace & Justice Group of Waldo County
Peninsula Peace & Justice Center (Blue Hill)
Resources for Organizing & Social Change (Augusta)