It is no secret that the economy — both at a national and state level — is hurting. That reality is something the Legislature must face as we work to craft a state budget for the next two years.
But this is not the first time that we have been faced with difficult choices. In recent years, the Legislature has seen revenue reductions and has made the necessary budget cuts and hard choices to keep Maine’s budget balanced.
Rather than facing that often daunting and unpleasant task with a Band-Aid approach, the Legislature, and particularly those of us on the Appropriations Committee, have been dedicated to not just making cuts, but making long-term structural changes in how state government operates. By making sensible changes to the budget and state operations, we not only make the necessary reductions in spending but we put the state in a strong position to capitalize and thrive when the current economic downturn subsides.
The recently passed federal recovery legislation is another opportunity for us to position Maine for a strong recovery. Details are still forthcoming about the 1,000-page document, but our state will be eligible for more than $1 billion of federal money over the next two years. Much of that funding is focused on various economic development projects such as infrastructure improvements, renewable energy investments, as well as funding support for education and health care.
This money will be extremely helpful to our state, but they should not be seen as a fix to our current budget downturn. While the funds will allow us to reverse some of $160 million in cuts made with the passage of the supplemental budget earlier this year, specifically those cuts to local kindergarten through 12th grade school funding and higher education, it does not solve our budget problems.
The new federal dollars will help us with local education funding as well as the state’s MaineCare account and ease some of the proposed cuts in the budget, but the majority of these funds are dedicated for specific economic stimulus programs. We cannot use these one-time funds as a plug to fill our budget gap. Despite this temporary infusion of funds, the state’s budget will see significant cuts and reorganization of programs.
Much of the recovery money that is flowing into Maine is dedicated to federally designated programs and projects in the state, a number of which will receive direct federal funding that will go directly to local communities and organizations.
As members of the Appropriations Committee we will spend a great deal of time in the coming weeks ensuring that those federal stimulus dollars are being spent properly and in the manner prescribed by Congress. This will be done through strict oversight in consultation with the Governor’s Office. The governor and the Legislature are committed to ensuring that Maine’s federal investment dollars are spent in the most effective way possible. We will review all programs to ensure they not only meet the often stringent federal requirements but also our state’s long-term economic goals.
The Appropriations Committee has worked hard in recent years to be careful not to use one time monies (such as the recovery funds) to pay for ongoing programs. Such actions simply cause bigger problems when those funds inevitably dry up. Instead, the stimulus funds allow us, as a state, to make several long-term investments that, if done correctly, will provide us with substantial returns in the coming years.
One of the most promising areas of is on the energy front. We know all too well the costs to our nation for being overly dependent on oil. The sharp rise in gas and oil prices last year were a stark reminder of the consequences of that dependence. The monies in the package represent a real opportunity to move our state away from foreign oil and toward instate renewable energy options including wind and wood. Support of the growing green energy industry will allow us to bring good paying, long-term jobs to our state. Coupling green energy investments with weatherization and energy efficient renovations can create a new energy future for our state.
While our main focus will be oversight of these funds, we will work to make smart investments that create jobs and build a strong economic framework for our state going forward. That is our overarching goal as we go about the hard work of building the state budget.
While difficult challenges still face us, there is much to be hopeful for and optimistic about. We have the opportunity to put Maine on a path to a strong economic future if we meet these challenges head on.
Rep. Emily Ann Cain, D-Orono, chairs the Legislature’s Appropriations and Financial Affairs Committee. Rep. John Martin, D-Eagle Lake, is a member of the Appropriations Committee and serves as the House chair of the Joint Select Committee on Maine’s Energy Future.