Panel backs bill to keep grads in state - Portland Press Herald

State House: The measure would give tax breaks on college loans to those who work in Maine.

by Ann Kim

AUGUSTA — A legislative committee gave a boost on Thursday to an effort to provide tax relief to Maine college students who work in the state after graduation.

The initiative, which would give graduates of Maine colleges an income tax credit for some or all of their student loan payments, already has enough petition signatures to be put to voters statewide.

But supporters of the plan went to the State House to urge lawmakers to enact the measure directly, and the Taxation Committee listened.

The 11 members present voted that the bill should be sent to the full Legislature for consideration.

Rob Brown, executive director of Opportunity Maine, the group that began the petition drive last year, called the committee vote a crucial step in a long process.

"I think it shows the power of people, and people speaking up," Brown said.

The petition organizers submitted more than 73,000 signatures to qualify for the ballot. On Thursday, more than 40 people packed the Taxation Committee's hearing room and all but a handful stood up when asked who was there to support the bill.

Under the proposal, anyone who earns an associate's degree or bachelor's degree from a college in Maine would be eligible for the tax credit in years the person lives and works in the state.

The credit would be limited to the amount actually paid toward loans, up to a maximum that would be calculated based on the costs of tuition and mandatory fees in the University of Maine System.

The limit based on current costs would be about $2,100 a year.

Any employer who makes the loan payments on behalf of a graduate could claim the credit.

Supporters of the proposal say it will encourage more people to pursue higher education, create a more skilled work force and help the state's economy.

All kinds of students -- young, old, traditional and those seeking to train for new jobs -- are burdened with heavy debt, said Andrew Bossie, president of Opportunity Maine and a recent graduate of the University of Southern Maine. He said many face the same difficult question.

"Will I be able to stay in Maine where I prefer to live and seek a decent living or do I go somewhere else where the wages are higher?" he said.

Anya Kamenetz, the author of "Generation Debt," told the committee that it is no longer possible for a student's full-time minimum-wage summer job to cover the next school year's expenses, as it was as recently as the 1980s.

The average student debt in Maine is $20,237 -- the seventh highest in the country, she said.

Rep. Herb Adams, D-Portland, urged the committee to support the initiative, which he called the GI bill for Generation Next.

Adams sponsored a fallback version of the bill that could have gone through the usual legislative process if the petition drive had not gathered enough signatures.

The enthusiasm of some committee members was clear, although there were some concerns raised about issues including the difficulty of recapturing wrongly claimed tax credit money.

Rep. L. Gary Knight, R-Livermore Falls, called the proposal a "terrific initiative" but said he would like to see a broader program that includes Mainers who attend school out of state and want to return.

Independent Rep. Richard Woodbury of Yarmouth predicted that the measure would succeed at the polls if it did not make it through the Legislature.

"It'll pass because it's a really great idea," he said.