The U.S. Senate's vote against a federal jobs bill last night could have major ramifications for tens of thousands of Maine's unemployed. Maine's two U.S. Senators voted against a bill that would have extended jobless benefits. And state officials say the lost revenue could lead to more cuts in Augusta.

The state now faces the prospect of having to close a $85 million budget gap, after the U.S. Senate failed to advance a bill that would have sent that same amount in federal assistance to Maine.

Maine was one of 30 states that had counted on getting higher federal contributions for Medicaid, and the state's $2.6 billion budget for next year reflected that.

"It's very serious because it's $85 million that we will have to find a way to fix, whether that's through cuts, through expanding revenues or through both," says David Farmer, spokesman for Gov. John Baldacci. He says that without some further aciton at the federal level, the state will start looking at how to cut the budget in July. Those cuts would take effect in October.

In addition to the Medicaid issue, Farmer says the administration is also concerned that the Senate did not vote to extend unemployment benefits for jobless people who've used them up, which was another provision of the same bill.

"While Maine's unemployment rate is below the national average and we've seen that our state has created jobs in four of the last five months, at eight percent, we still have too many people unemployed," Farmer says. An estimated 30,000-plus jobless Mainers will have exhausted their unemployment benefits by the end of the year.

Despite heavy courting by Democrats, Maine's Republican Sens. Olympia Snowe and Susan Collins both voted with their party against the bill, which failed by a vote of 57 to 41.

The senators say the bill would have increased the federal deficit, and placed more of a tax burden on small businesses. Snowe spent 45 minutes on the floor of the Senate explaining her vote.

"What's proposed for legislation here today -- and that's the disconnect that exists between here and the rest of America -- is taxes, taxes, taxes, spending, spending, spending," she said.

But Snowe also stated her support for Medicaid aid to states and for extended unemployment benefits, the latter of which both she and Collins say should be addressed in a stand-alone bill.

The senators' votes were greeted with disappointment by unions in the state, and by the Maine Center for Economic Policy. Executive director Christopher St. John questions the senators' priorities.

"One of our concerns is whether senators are looking at some of the particular tax provisions, which affect a very small number of taxpayers in Maine, and how they're weighing that against the needs of very large numbers of unemployed people and people who depend upon Medicaid, and every Maine taxpayer who counts on the Medicaid funding for the state budget," St. John says.

But St. John says he is hopeful that the senators will be able to come to some compromise with Democrats so that the state and its unemployed can get some help from Washington.

Meanwhile, David Farmer of the governor's office says preparations are underway to send directives to department heads to trim their budgets. On the bright side, says Farmer, state revenues have been higher than projected, and some of that could be applied toward the hole created by a $85 million loss in anticipated federal funds.

"Individual income taxes were over budget in May by $12 million," he says. "And sales and use taxes were over budget by $5.5 million."

But Farmer says its too early to predict whether the state's economy will sustain that kind of growth, or even whether the state will end the year with a surplus at all.