Budgets, Barack, bans
Placeholder budget
- Guv reveals his proposed cuts
- Lawmakers predict changes
Gov. John Baldacci is proposing a $6.1 billion budget for the next two years that cuts hundreds of state jobs, increases a few fees and reduces funding for education. The proposal would also shift millions in expenses to local government.
One portion of the budget relies on a $98 million “placeholder” that anticipates passage of a federal stimulus package that includes an increase in the federal match rate for Medicaid. That worries Rep. Sawin Millett (R-Waterford), the lead GOP member of the appropriations committee.
“That is using one-time money for on-going costs,” Millett said. “While the governor has sought to restructure to lower costs in some areas, he is also raising some fees and that has to be carefully reviewed.”
Millett served as finance commissioner in the administration of former Gov. John McKernan and said lawmakers will have to work to craft any alternatives to what the governor has proposed.
“I think the governor has done a good job in setting his priorities, but it is up to this [appropriations] committee and the whole Legislature to set the state’s spending priorities,” said Sen. Bill Diamond (D-Windham), co-chairman of the panel.
Rep. John Martin (D-Eagle Lake), a longtime committee member and former speaker of the House, called the proposed budget “dead on arrival,” the day before it was released. “They all are.”
Some sections, for example, have been defeated in past sessions, like the governor’s bid to send some inmates out of state. That idea is broadly opposed and was defeated last session. Sen. Stan Gerzofsky (D-Brunswick), co-chair of the Legislature’s Criminal Justice Committee, said the idea does not overall save taxpayers money.
That is a familiar refrain among critics of the budget. The governor plans to shift costs back to local cities and towns, and local governments have already lost expected revenue from the decrease in sales and income tax revenues from which they receive 5.1% of the total. Baldacci wants to reduce that further by an overall 10% cut.
He also proposes to freeze school aid at this year’s reduced level for the next two years and reduce the tree growth tax program by 10%. Saying all parts of the state’s economy need to “feel the pain,” the governor’s budget also reduces the funding for the Business Equipment Tax Reimbursement program by 10%.
Public hearings on the budget will not start until February. Lawmakers need to pass a budget to fund state government through the rest of this budget year with revenues $140 million less than first projected.
Baldacci: Maine needs $3.6B stimulus
- Guv sends letter to Obama
- Asks for help with brick-and-mortar, social services
In a letter to President-elect Barack Obama, Baldacci argues for an expansive stimulus package that would bring at least $3.6 billion into Maine over the next two years.
“Where I am coming from,” Baldacci said in an interview, “is trying to develop a package that works along the lines the president-elect and his team have put forward — trying to make sure that these are shovel-ready, trying to make sure they are sustainable, trying to make sure they will not only help in the short term, but will help in the long term with our economy.”
In his letter, the governor urged substantial investments in traditional infrastructure, like roads, bridges and buildings, as well as non-traditional infrastructure such as fiber optic communications and electric transmission lines. The largest investment would be $1.88 billion for school construction and repair, then $500 million over two years for roads and bridges, and $186.9 million for other transportation projects from airports to walking trails.
The governor wants $250 million to repair, upgrade and weatherize state facilities from office buildings to state parks, and $130 million for water and sewer projects.
The letter also outlines a $200 million loan program for businesses to improve their energy efficiency and $115 million to expand fiber optic communications infrastructure into rural Maine. It also lists a $100 million expansion of the state’s electric transmission grid and funding for the first year of a 10-year plan to weatherize every home in the state. That first year cost is pegged at $72 million.
“We also need to make sure we keep providing the services that are in greater demand in this recession,” Baldacci said.
The governor wants to expand the federal food stamp program and training programs to provide new skills to workers who have lost their jobs and increase the federal share of Medicaid that would reduce the state cost by at least $100 million a year. Baldacci also suggests the federal government meet its commitment to fund 40% of the cost of special education in local schools.
“While many federal programs are helpful in moving the economy, it is the states whose programs can provide immediate, tangible results in putting people to work and building the architecture for a strong economy,” Baldacci wrote.
Offshore drilling ban?
- Bill would block Maine drilling
- Guv, GOP leaders critical
Drilling for oil or natural gas off the coast of Maine would be banned under legislation proposed by Rep. John Martin (D-Eagle Lake). It’s a bill sure to provide lawmakers something to fight about besides budget cuts.
“I am convinced if we don’t have a ban in place, somebody will drill,” Martin said in an interview.
Martin believes there will be efforts to drill in the Gulf of Maine after Congress allowed the federal ban on offshore drilling to lapse a few months ago.
State territorial waters end three miles from their shores, and beyond that limit, Maine and the 18 other coastal states have “administrative zones” established in 2006 by Congress to help the federal government determine areas that would be negatively impacted by energy development.
States will not have the final say, but they will have significant influence on any drilling because any pipelines bringing crude oil or gas to shore will travel through state territorial waters and be subject to state laws and regulations.
Baldacci said his Ocean Energy Task Force is looking at all offshore energy options and includes a wide range of members, including environmentalists and members of the business community.
“I have an obligation to do a complete inventory of what is available,” Baldacci said. “I may agree in the end that we should not drill, but I need the facts. Maine people want the facts.”
Baldacci said a review of existing data by state geologists indicates little chance of finding significant oil or gas deposits in the Gulf of Maine. But he said banning all drilling is premature until a more thorough review of geologic data can be completed.
Rep. Josh Tardy (R-Newport), the House GOP leader, said it would be a mistake for the state to ban drilling without first fully exploring the potential of oil and gas off Maine’s coast.
“To take away an option right now when we are in an energy crisis in the United States would be the wrong thing to do,” he said.
Mal Leary runs Capitol News Service in Augusta. He can be reached at editorial@mainebiz.biz.
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