State cuts in Defense, Veterans and Emergency Management threatening federal funds

Posted Feb. 02, 2012, at 6:52 p.m.

AUGUSTA, Maine – The commissioner of Maine’s Department of Defense, Veterans and Emergency Management warned lawmakers this week that state funding cuts are putting millions of dollars in federal funds for his department in jeopardy because it is increasingly difficult to meet matching fund requirements.

“Maine National Guard facilities and operations and maintenance is shared between the federal and state governments at 75 and 25 percent respectively,” Maj. Gen. John Libby (Ret.) said Wednesday. “We are dangerously close at this point in time in terms of the state share in not meeting the cooperative agreement.”

Libby told members of the Legislature’s Veterans and Legal Affairs Committee that his agency relies on federal funds for a wide range of programs and that every time his agency has to find $25,000 in state cuts to help balance the budget, he loses $75,000 in federal funds.

“If you do the rough math we are over $300 million that we bring into the state on a $3.5 million budget,” he said. “That’s not a bad investment for the state, I would argue, both in terms of its service to the nation and its service to the state.”

Libby said having a basic operational infrastructure in place has allowed the agency to get 100-percent federal funding for some programs and projects. He is concerned further reductions in state funding will jeopardize that ability.

Rep. Mike Carey, D-Lewiston, asked Libby when the state would hit the “tipping point” and actually lose federal funds.

“We’re there now, it could happen this year,” Libby responded. He said he has talked with Gov. Paul LePage, budget officials and members of the Appropriations Committee warning them of the “unintended consequences” of cuts in state funding to his agency.

“Every time we are asked to do something as simple as eliminate a maintenance mechanic because I have to find $35,000 in the budget, we put $105,000 of federal money at risk,” he said.

Finance Commissioner Sawin Millett said in an interview that the Department of Defense, Veterans and Emergency Management is not the only state agency that has agreements with federal funding sources that require the state to provide a match to receive the federal dollars.

“I am very much aware of the need to maintain our effort on all of those federal match programs that trigger substantial benefits for the state of Maine,” he said. “We keep that in mind all of the time.”

Millett said it has been a difficult process as the state has sought to reduce budgets to keep spending within revenues. He said while every agency was asked to take some reduction in spending to help with the $25 million needed to balance the second year of the state budget, all the cuts in the measure were proposed by the agencies.

“Everyone is bumping up against limits,” he said. “It is very difficult for everyone.”

In his presentation to the VLA Committee, Libby laid out the economic impact the agency has on the state, principally with the Army and National Guard detachments. He said in addition to Camp Keyes in Augusta with its staff, there is the Air National Guard base in Bangor as well as a training center in Bangor and several state armories.

“The math is pretty clear,” he said.

Libby said the expenditures for the Army National Guard in the state are roughly $105 million a year. Another $135 million a year is spent on Air National Guard programs and $60 million a year is spent by the Veterans Bureau.

In addition, Libby said, there are the operations of the Maine Military Authority in Aroostook County that overhaul military vehicles for use by both active duty and guard units throughout the military. He is hopeful they may get some additional work to overhaul excess equipment for sale to other countries.

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