AUGUSTA – On Wednesday, the Maine Legislature’s Health Coverage, Insurance and Financial Services Committee advanced a bill from Senate President Troy Jackson, D-Allagash, to support state and federal workers during prolonged government shutdowns. The vote was 7-4 with Republican committee members voting against the proposal. 

“When a federal shutdown occurs, the federal workers living in our state are in dire need of our help,” said President Jackson. “We may not be able to restart their paychecks, but we can ensure that they have access to funds to continue paying their bills until their backpay kicks in and their paychecks restart.”

LD 2113, “An Act to Provide Relief to Federal Employees Affected by a Federal Shutdown” would provide a state guarantee on private, interest-free loans from banks and credit unions to state and federal government employees living in Maine, who have been furloughed without pay or who have been required to work without pay during a government shutdown lasting longer than seven days.

“Federal employees in Maine are the backbone of essential services, from maintaining our Navy submarines to providing Social Security benefits to seniors and safeguarding aviation, infrastructure, public safety, and our borders. Yet, when they are furloughed or compelled to work without compensation, they face a daunting challenge: struggling to pay for heat, put food on the table, and meet their financial obligations,” said Scott Lizotte,  a federal firefighter from Washington County and President of IAFF Local F-316. “It is crucial to understand that these dedicated individuals are not the architects of federal shutdowns and should not be pawns in partisan games.”

Each employee would be eligible for up to three loans during a shutdown, each equal to their monthly after-tax pay, minus unemployment benefits – up to a maximum of $6,000. 

“The threat of federal shutdown has loomed more often in recent years, by passing LD 2113, Maine’s credit unions, will be prepared in case the situation unfolds once again. Maine credit unions are here to help their members and this law will allow them to help more impacted members and more quickly by reducing the risk of lending,” said Ellen Parent, Maine Credit Union League. “By creating a permanent solution for assistance during federal shutdowns, Mainers no longer have to wait for the Legislature to bring a bill and are not stuck if the shutdown occurs outside of session.”

Eligible impacted workers can access the program at a participating bank or credit union. Lending institutions can choose whether or not to participate in the program.

“Maine has many residents who are employees of the federal government. During a partial shutdown or full shutdown of the government, these federal employees are not paid, regardless of whether they are working. This can cause enormous stress, both fiscal and emotional, on those employees,” said Bill Norbert of the Finance Authority of Maine. “We are happy to play a role in assisting them until they return to paid work.” 

There would also be a grace period before repayment could be required, either until the end of the shutdown or 90 days after disbursement, whichever is later, and there would not be any interest allowed on the loans until 180 days following the end of the grace period. 

The original proposal only covered federal workers and federal government shutdowns lasting 14 days. With President Jackson’s support, the Committee expanded the loan program to cover state workers and state government shutdowns. The Committee also shortened the minimum length of the shutdown required for the workers to be eligible for the program from two weeks to one week.

LD 2113 faces additional votes in the Senate and House in the coming weeks.