Budget cuts are real, with a deep impact for Maine

Posted Feb. 12, 2010, at 7:27 p.m.

During the public hearings on the governor’s proposed supplemental budget, hundreds of people came before the Appropriations and Financial Affairs Committee to offer their insights regarding proposed cuts and policy changes. My colleagues and I have received hundreds of e-mails, dozens of phone calls and stacks of letters outlining concerns, questions and alternative proposals from people across the entire state.

Building on those hearings, the policy committees of the Legislature have focused in on their relevant sections of the budget and made initial recommendations to the Appropriations Committee. Those reports are now being reviewed and voted upon by the appropriations panel, and alternative proposals are being discussed. All of this is normal operating procedure for balancing the state budget, but the thorough and deliberative process is where the normalcy ends.

There is nothing normal about this year or the challenge before us as a state. The $438 million shortfall we are facing is not the first major shortfall we have experienced and it won’t be the last. In the past 12 months, Maine’s revenues have decreased by $1.15 billion and the Legislature has made significant cuts to ensure our budget remains in balance given the new fiscal reality.

Last year we cut $556 million from the general fund budget, making it the first time since 1974 the state budget was smaller than the prior year’s. The current supplemental budget, which is under consideration now, reduces state spending by another $438 million. If approved, it will make the current FY 10-11 biennial budget roughly the same size as the FY 04-05 budget.

These have been real cuts and they have had real impacts. For example, in the last seven years we have reduced the state work force by 1,000 employees, nearly 9 percent of the state work force.

For those still employed, last year’s budget imposed 20 unpaid shutdown days, froze scheduled pay increases and required employees to pay a portion of their health care. These provisions will cut spending by nearly $33.8 million over the biennium. At the same time, we have reduced the work force and we have asked state workers to do more with less.

The Department of Health and Human Services has seen a reduction of 300 employees since 2005. Yet caseloads in MaineCare, Maine’s Medicaid program, have increased by 120,000 over the last eight years, and the department’s expenditures for the next fiscal year are slated to be $31 million lower than what they were nine years ago.

We are doing more with less. And will continue to do so.

But we must consider the long-term impact on our state.

While significant efficiencies were found last session and in previous years, many state programs and services have been cut to the bone, leaving the Legislature with difficult choices as we look to balance the upcoming budget.

Also, Maine people must understand that most of the money the state receives in revenue does not stay in Augusta, but flows to local communities. Roughly 80 percent of the budget goes to local communities either directly through programs like revenue sharing and K-12 school funding or indirectly through payments to local hospitals, doctors, mental health providers, community colleges and universities and the jobs they provide.

That means that cuts translate into lost dollars and jobs; not to some unknown state bureaucracy, but to local communities, businesses and institutions that provide vital services. These are the same programs and services that I hear people asking me to protect for our state’s long-term strength and to position it for future growth as the economy improves. They are not seen as excessive government.

Most people don’t realize that these vital services and budget items make up the majority of government spending, not the mythical bloated government that is often perceived in Augusta.

Cuts will hit small communities the hardest. And Maine is a big state made up of small communities. The truth is that in these difficult economic times, our job in the Legislature is to carefully consider every proposal and work to mitigate cuts as best as we can within what is already a very lean budget.

Rep. Emily Ann Cain, a Democrat from Orono, is the House of Representatives chairwoman of the Legislature’s Appropriations and Financial Affairs Committee.

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