CONTRIBUTORS

LePage’s restriction on bonds hurts businesses he claims to support

Posted July 24, 2012, at 5:49 p.m.
Emily Shaw is an assistant professor of political science at Thomas College in Waterville.
Emily Shaw is an assistant professor of political science at Thomas College in Waterville.

Gov. Paul LePage’s unprecedented decision to insert himself into the voter-authorized sale of Maine bonds on the theory that doing so would add “more of a burden [and] be fiscally irresponsible” is already starting to turn things around for Maine businesses.

Only not in the direction that most of us would like to see.

One of the bonds that LePage has unilaterally placed on hiatus was money intended for the Communities for Maine’s Future grants. This $3.5 million bond was promised in 2010 as support for capital projects that promote municipal economic development. To get up to $400,000 in state money, each town had to find investment to match those grants at least at a dollar-to-dollar level. In other words, this was not “free money.”

One by one, those towns found private investors, received the backing of their residents and dedicated themselves to a much larger revitalization project than what the state funded alone. This bond represented seed money, which galvanized increased commitments to some places that could really use it.

Where was that money intended to go?

The 11 communities who were told they would receive the grant money — Livermore Falls, Monmouth, Winthrop, Rockland, Norway, Dover-Foxcroft, Bath, Skowhegan, Belfast, Unity and Eastport — are not only well-prepared to complete these projects but are in a position to clearly and uniquely benefit from them. These towns and cities are trying to develop at a time when the state’s growth is increasingly driven by its southern and urban regions.

The state’s population as a whole grew slightly more than 4 percent in the decade between 2000 and 2010. However, that growth was highly uneven. Metropolitan areas such as Bangor and Ellsworth grew substantially over the last 10 years, and southern Maine counties grew at around 6 percent. Meanwhile, most of the towns which were slated to receive money through the grant actually lost residents over the last 10 years.

Skowhegan lost nearly 3 percent of its population between 2000 and 2010; Bath, 8 percent. Eastport lost an astounding 20 percent of its population in the last decade. (In this bicentennial year of the War of 1812 — a war in which Maine allowed Eastport and its neighboring towns to be captured and owned for several years by the British, couldn’t we do a little more to show our appreciation for them?)

There is a symbiotic relationship between population growth and employment. More people mean more economic activity. The relationship naturally flows the other way as well: Where there is less economic activity, there is less employment, and younger, more mobile individuals will leave. Where towns experience population loss, they ironically experience a rise in unemployment.

The towns which would have received money from this grant mostly have unemployment levels above the state average, and all but one have unemployment levels above the average for their counties. The money from the Communities for Maine’s Future grant was intended to help reverse that dynamic.

Based on the state’s promise of the grant money, Skowhegan had already begun to improve pedestrian and parking areas downtown. One of the contractors involved in that project was Dirigo Engineering of Fairfield, one of those “small businesses” that are eternally popular in campaign speeches, yet apparently not such a priority when it comes to actually paying them. In Bath, that money was going to pay Maine craftsmen to restore the town’s historic Customs House. As part of their grant, Eastport was due to host a group of restorationists from Dixmont, an economic boon to two small communities.

In deciding not to honor Maine’s commitment to these towns, the governor not only impeded these specific projects but interrupted the complicated and challenging task facing so many Maine towns: the problem of regaining both people and employment.

In order to break cycles of diminishing population and economic activity, towns must find ways to attract attention and investment. The Communities for Maine’s Future grants would only have helped towns become more competitive.

By approving the 2010 bond measure, Maine residents understood that helping our smaller towns is not “a burden.” Maintaining the economic health of our towns is essential to the health of our state. When we help our towns attract investment for economic development, everybody wins.

Emily Shaw is an assistant professor of political science at Thomas College in Waterville where she focuses on state and local politics. She is a member of the Maine Regional Network, part of the Scholars Strategy Network, which brings together scholars across the country to address public challenges and their policy implications. Members’ columns appear in the BDN every other week.

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