Robust bond package is vital to Maine businesses
To the editor:
Maine's roads and bridges are in rough shape.
That's not only bad for motorists, who according to the American Society of Civil Engineers fork out an average of $285 a year for wear and tear on their cars. It's also bad for businesses that rely on a sound transportation system to import raw materials, get their goods to market and connect with customers.
Maine lawmakers can take a big step toward fixing the problem, and make other wise investments in the state's economy, when they return to Augusta on May 15. All they have to do is approve a common-sense bonds package to fund roads, bridges, research and development and communications technology. Such investments will make Maine businesses more competitive, create jobs and save taxpayers money over the long term.
Two specific proposals offer important benefits for Maine's economy and workers. One, LD 225, would provide $50 million for research and development in precision manufacturing, information technology and a variety of other critical and growing industries. Jobs that result from such investment will pay well above current average wage levels and are exactly the kind of employment opportunities we should be encouraging. Another, LD 829, would invest $100 million in transportation, broadband, downtown revitalization and higher education in regions with high unemployment. Such investment will provide a timely boost in areas of greatest need and contribute to future prosperity.
Over the years, Maine voters have routinely approved bonds. The Legislature failed to send a bond package to voters in 2011.That means fewer job opportunities now and a worsening business climate. With a growing backlog of projects, interest rates at historically low levels and significant federal matching funds available, it is critical that legislators put a robust bonds package before voters. Failure to do so two years in a row would be unprecedented in recent memory and increase the cost of future projects for everyone.
With more than 50,000 Mainers still unemployed three years after the end of the worst recession since the Great Depression, putting people back to work should be this Legislature's top priority. Removing bonds as one of the tools for doing this is like trying to construct a house without a hammer. Bond-funded investments will get people working, put money in their pockets and deliver sound fiscal and business returns.
The case for bonds is as strong as the case against them is weak. The facts do not support claims that Maine's existing debt is unsustainable. Maine's tax-supported debt is $865 per resident, well below the $1,066 national median. Maine retires its bonded debt in 10 years, while many other states take decades. Maine uses general obligation bonds only to fund road and other infrastructure improvements, while other states also use them to cover operating expenses. And Maine's funding of approximately half of its annual bricks-and-mortar spending with available funds places the state in a much stronger position to issue bonds.
Moody's Investors Service, one of America's most respected rating agencies, has recognized Maine's solid record of responsible debt management. In spring 2011, Moody's wrote: "Maine continues its conservative approach to debt, with an aggressive payout structure and capacity to accommodate unforeseen borrowing needs."
For Maine businesses, the stakes are high. Bad infrastructure is bad for business. To build a world-class economy Maine must have world-class communications and transportation systems. A smart bonds package means smart public investments so Maine businesses can compete and win. The Legislature needs to set political differences aside and give voters a chance to decide on future investments. Legislators need to hear from all of us that failure to send a robust bonds package to voters in 2012 will seriously hurt our state's ability to create jobs and build a strong economy.
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