AUGUSTA, Maine — Gov. John Baldacci urged quick, bipartisan legislative action on a budget cut plan he presented Tuesday that reflects a recession-driven revenue shortfall of more than $140 million.
“It needs to be acted on. The quicker and sooner, the better,” Baldacci said after outlining his supplemental budget proposal for fiscal 2009, which is half over and ends June 30.
The cuts continue nearly $80 million in curtailments the governor ordered last month. The plan presented Tuesday also calls for elimination of 94 positions, including 40 layoffs. Most of the layoffs would be in the Corrections Department, which would scale back its minimum security facility at Charleston and transfer the inmates to county jails.
Baldacci said the budget includes no fees or fines, although it does seek technical changes in a few tax laws that tweak timing but not rates. The supplemental draws $45 million from the state’s reserve accounts.
“The U.S. economy is in recession, and most states are facing serious budget challenges, many on a scale far worse than the state of Maine,” Baldacci said. “People are losing their jobs, they’re watching as their retirement accounts decline in value, there’s fears that things could get worse.”
The Democratic governor said that with a newly elected president, there’s hope for a new partnership with Washington to help states out of their financial woes. But Baldacci also said any economic stimulus package passed by Congress would take effect too late to have any impact on the present state budget, although it might in the budget for 2010-11.
Republican leaders endorsed the governor’s refusal to include tax or fee increases and said the package he described “sounds generally reasonable and balanced.”
But the statement by Senate Minority Leader Kevin Raye of Perry and House Minority Leader Josh Tardy of Newport did question a portion of the budget they said would reduce reimbursement for hospital-based physicians and critical access hospitals.
“The Legislature now has a responsibility to carefully scrutinize each component in detail before passing judgment,” said the GOP statement. Democrats promised to review the package closely.
“This difficult economic climate presents us with no good choices. The Legislature will meet our constitutional obligation to balance the budget while still protecting the most vulnerable and creating opportunities for the people of Maine,” Senate President Elizabeth Mitchell of Vassalboro said.
Passage of that budget package will set the stage for review of a budget for the two years starting July 1, 2009, work that also must be accomplished in the months ahead.
The state is facing an even greater gap between revenues and programs as they now exist: $838 million. Baldacci said he will present that biennial budget package on Jan. 9 that will include details on how those cuts may be achieved.
Past cutbacks already have reduced the size of state government by 729 workers in the past five years, Baldacci said. But he said budget shortfalls have prompted efforts to make efficiencies in public schools, human services and corrections while avoiding broad-based tax increases.