Last Monday, Gov. Janet Mills introduced her vision for a new $8 billion Maine state budget, focusing on investments to Medicaid, education, and tackling the opioid crisis.
“This is a pragmatic, common-sense budget that lives within our means and delivers what Maine people want,” said Mills in her State of the Budget speech in the Legislature. “In short, this budget is sustainable. This budget is balanced, as the Constitution requires; it makes responsible investments to tackle serious challenges facing our state; and it honors the will of the people.”
Here are the highlights from the Governor’s proposal, which will be deliberated over in the Legislature's budget writing committee before heading to votes in the Democratic controlled House and Senate sometime in April.
- Gov. Mills plans to set aside $147 million in the state budget, and an additional $29 million in the Medicaid Reserve Account to support MaineCare expansion which will extend health care coverage to 70,000 Mainers preventing many of them from “having to choose between vital medical care or bankruptcy.” This initial investment will trigger about $1 billion in additional federal dollars, meaning that no new taxes or fees are needed to fund the expansion in Maine.
Mills called it the “bargain of a century” and said it would stimulate the economy by bringing in $500 million in federal funds and an estimated 6,000 jobs throughout the state.
“All of these workers will pay income and sales tax, which will in turn help the state’s bottom line,” said Gov. Mills. “This is economic development on a large scale.”
- Highlighting grim statistics from the Attorney General’s office which showed that 282 Mainers died from drug overdoses in the first nine months of last year, Gov. Mills proposed $5.5 million to provide action against the opiate crisis. These funds would provide: training for recovery coaches, increased Narcan distribution, increased education and prevention efforts, and treatment based on the regional “hub and spokes” model.
Gov. Mills also proposed investing $10 million for programs to prevent young people from using tobacco and nicotine.
- Rebuilding Maine’s education infrastructure, which Gov. Mills said has “suffered from years of neglect,” is also a stated priority for the new administration. Her plans to do this include implementing a universal pre-k program statewide, $18.5 million set aside for Child Development Services, and an additional $126 million provided for public schools through the biennium, bringing the state’s share of public education funding to 51 percent. This budget also ensures that Maine teachers won’t make less than $40,000 a year.
- Other education investments include: $3 million more in Maine State Grants for college students, and increased funding for the University of Maine system.
Gov. Mills closed her nearly 30 minutes speech with proposals on how to upgrade the state’s infrastructure and expand the economy. “Over the next two years, we will pave about 2,000 miles of roadway, fix or replace about 135 bridges, and invest in rail, public transit, and seaports,” said Gov. Mills.
The new budget sets aside $2 million to expand broadband access to rural areas, and funds to market all all parts of Maine, “not just as a tourist destination, but as places to live and work and raise a family.”
- Although specific funds haven’t been proposed yet, the budget also mentions the creation of an agenda to tackle climate change without using funds in the Maine’s $273 million “rainy day fund.” Gov. Mills expressed interests in assisting the University of Maine in their research of offshore wind power, providing incentives for solar power, expanding charging stations for electric vehicles, and install 100,000 heat pumps in businesses and houses throughout the state by 2025 (an effort to lower carbon emissions and save taxpayers on heating bills).
BUT IS IT SUSTAINABLE?
As expected, Republicans are critical of the new budget proposal and argue that the increase of spending might force Maine to tap into their rainy day fund if the economy takes a dip.
"My concern is that the Governor’s 11 percent increase in the State Biennial Budget is unsustainable,” said House Republican Leader Kathleen R. J. Dillingham. “Respectfully, any plan that burdens taxpayers with over $8.04 billion dollars every two years represents a failure to truly prioritize what matters most."
Former Gov. Paul LePage reemerged to lambast the new budget, repeating his concern that the Medicaid expansion is funded on projected revenue forecasts which by his logic makes it unsustainable, despite the fact that the federal government would fund more than 90 percent of the expansions cost.
“The difference between Janet Mills’s budget and a drunken sailor is that a drunken sailor spends his own money,” said former Gov. Paul LePage in a press release. “It is outrageous. She’s spending the projections before the money is even in the bank. It is irresponsible.”
Mills defended her budget on Monday by reiterating that it prioritizes the needs of Maine people who she recognizes overwhelmingly want better health care, better jobs, better schools, and greater economic opportunity without raising taxes. Gov. Mills is confident that future revenue projections will be enough to pay for her increased spending plan. “When taken in combination with the robust Rainy Day Fund that we have protected, Maine is well-positioned in the years to come,” she said.
According to the official overview of the budget, released by the Governor’s office, the spending plan is an 11 percent increase over the current $7.2 billion budget, but the increase is offset by 8.3 billion that the independent Revenue Forecasting Committee estimates Maine will collect in the next two years.
The non-partisan Maine Center for Economic Policy reacted to the budget last week in a statement to the press, praising it for “making progress on investments critical to Maine’s future, particularly in the area of health care.”
But according to Garrett Martin, the executive director of MECEP, the budget doesn’t do enough to address Maine’s revenue challenges because it maintains LePage era tax-cuts which doesn’t provide the necessary resources to fully fund education and local services.
“These revenue challenges were caused by tax policies established under Gov. Paul LePage, which resulted in underfunded schools, cuts to local and state services, and an upside-down tax code where the top 1 percent pays less per dollar in state and local taxes than any other group,” said Martin. “This budget cycle, the state is missing $864 million because of those tax cuts, which primarily benefit the wealthiest households.”